Not So Fast, Mr. Romney

Massachusetts won't be the easy pickings Mitt imagined

He didn't get the gold, but few received as much acclaim during the Winter Olympics as Mitt Romney, CEO of the Salt Lake Organizing Committee. When the telegenic Mormon multimillionaire parachuted in from Massachusetts to rescue SLOC in 1999, it was facing a $379 million deficit and the worst scandal in modern Olympic history. By the time the Olympic flame was extinguished in February, Romney had produced a $50 million surplus and near-flawless Games, despite the terror threat. "Mitt, you did a fabulous job," gushed President George W. Bush at a post-Olympics celebration.

With raves like that, no wonder Republican Romney seemed headed for a coronation when he announced in March that he was running for governor of Massachusetts. Although just 14% of voters there are registered Republicans, Romney had overwhelming favorability ratings--and easily bested every Democrat in early polls.

Massachusetts Republicans began talking about Romney as the great hope of a state party so weak that it doesn't hold a single seat in Congress and has only token representation in the state legislature. "Romney is a new beginning," says Jonathan Fletcher, executive director of the Massachusetts Republican Party. Adds GOP consultant Scott W. Reed: "Romney has made it a competitive racein a year we're facing a guaranteed net loss of governorships."

Even Democrats began handicapping Romney's Presidential prospects. If he wins in Massachusetts, "the Republican Party would clearly see Mitt as national ticket material," says former Democratic National Committee Chairman Steven Grossman, one of five Democrats vying to oppose Romney in November. "When Romney galloped in on his stallion, the view was that this was his election to lose," adds former Clinton Labor Secretary Robert B. Reich, another of the Democratic candidates.

Suddenly, however, Mitt's horse is mired in the muck of Massachusetts politics, and the supposed shoo-in is facing what now looks to be one of the hardest-fought gubernatorial contests this fall. "It will be a real battle," concedes Romney, looking rumpled and somewhat perplexed during an interview at his crowded campaign headquarters. "Running the Olympics is nothing" like running for office in Massachusetts, he says, "where politics is a blood sport."

Romney's first big setback came on June 7 when the state Democratic Party challenged his right to be on the ballot, arguing that he had not been a resident of Massachusetts continuously for the seven previous years, as required by the state constitution. But even Massachusetts Treasurer Shannon P. O'Brien, another Democrat hoping to oppose Romney, concedes: "The chances of knocking him off the ballot are slim."

That's because the state's Ballot Law Commission traditionally takes a broad view of the residency requirement and Romney continued to vote in Massachusetts even while he was running the Olympics in Utah. Besides that, the five-member commission, which is appointed by the governor, has three Republicans, one independent, and one Democrat.

The problem for Romney is that as the flap erupted, the Olympics' Mr. Clean was caught making inconsistent statements about whether he had filed as a Massachusetts resident for tax purposes in 1999 and 2000. In fact, he got a $54,000 tax break on a $3.8 million home in Utah because he filed as a state resident.

All that has given Dems plenty of ammo. "Serious questions have been raised about his integrity," fumes O'Brien. "He lied," adds Philip Johnston, chair of the Massachusetts Democratic Party. Romney chalks up the confusion to the complexity of tax laws. "It was a rookie mistake," says Ron Kaufman, a Washington-based counselor to the Bush family. "The campaign is still getting its legs."

Until Romney arrived, Dems were expecting to face off against the blunder-prone incumbent, Governor Jane Swift. That attracted an all-star cast of challengers, including Senate President Thomas F. Birmingham, clean-elections candidate Warren Tolman, plus O'Brien, Grossman, and Reich. On June 1, the chaotic state Democratic convention failed to eliminate any of them. As a result, "the five Democrats will beat the hell out of each other over the summer," predicts Fletcher.

Indeed, the Sept. 17 primary is shaping up as intensely competitive. O'Brien, a moderate who blew the whistle on overspending on the Big Dig--a massive project to put Boston's central arteries underground--is considered the front-runner and was endorsed by the convention. But she faces a stiff challenge from Birmingham and from Reich, who is underfunded but has enthusiastic support among college students and well-heeled liberals. And Grossman, who polls poorly but has raised $3.5 million, could shape the outcome with his expected TV ad blitz. As a result, Reich says it may take no more than 35% of the vote to win.

Despite the disarray among the Dems, Romney is already bracing for the character attacks this fall. For starters, Democrats--dusting off the portrait painted by Edward M. Kennedy during Romney's failed 1994 bid to unseat the senior senator--will argue that the former chief executive of Bain Capital Inc. is a robber baron who heartlessly slashed jobs to build his own fortune. This time, Romney will respond that, on balance, Bain's investments created thousands of jobs.

Democrats will also argue that "Romney's right-wing social views would not resonate well within this state," says Johnston. He complains that Romney has offered scant support for gay rights and has flip-flopped on abortion. But O'Brien has also shifted her abortion stance. There also may be some lingering animosity towards Romney--especially among women--because of the way he came charging into the race, forcing Swift to withdraw almost immediately.

More important, Romney faces a tough balancing act on fiscal policy. With plunging revenues creating a budget gap of about $3 billion, "Massachusetts is facing the most serious fiscal crisis since World War II," says Michael J. Widmer, president of the Massachusetts Taxpayers Foundation. In response, the legislature is preparing to raise income, cigarette, and other taxes by more than $1 billion. Romney says he would accept those increases but work to roll them back before the end of his first term.

Romney also predicts that he could save as much as $1 billion by slashing patronage, inefficiency, and other waste. And he vows to shake up failing public schools--with English immersion classes, merit pay for teachers, and full-day kindergarten.

Many Dems concede that Romney has a huge advantage as an outsider running against an entrenched power structure. A staggering 73% of voters have only a fair or poor view of the job the legislature is doing, and 58% are dissatisfied with the performance of state government, says John Gorman, president of Cambridge pollsters Opinion Dynamics Corp.

Still, "this race is probably a 50-50 toss-up," says Gorman. Sure, Romney has enormous star appeal. But after 12 years of Republican governors, the Democrats are hungry for victory and have vast resources on their side. Throw in the residency flap, and it's clear that the savior of Salt Lake isn't looking at a downhill run.

By William C. Symonds in Boston, with Lorraine Woellert in Washington

— With assistance by Lorraine Woellert

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