Icepicks and Nukes

After last week’s twofold controversy over his tenure at Bain Capital and his tax returns, Mitt Romney is facing two difficult choices: deal with the existing bad optics of the situation, or create a new set of optics which could be even more difficult to deal with.

If Romney keeps refusing to release his tax returns – which looks especially bad for him considering the precedent set by his own father during the 1968 campaign – the Obama campaign can keep the story alive. If he does release them, he will look weak for having caved to pressure from the Obama campaign, especially considering that Team Romney has demanded retractions/corrections for stories from the Washington Post and the Boston Globe, and an apology from the Obama campaign for Stephanie Cutter’s comments about Romney possibly committing a felony. Romney’s demands for all three were turned down.

Setting aside the questions about outsourcing, offshoring, and when he left Bain on paper and/or in practice, the question everybody is asking is why would Romney continue to withhold his tax returns? James Fallows and John Cassidy offer some possible explanations, which can be broken down into three theories:

• The returns could reveal what a Fallows reader describes as “a shocking level” of tax avoidance.
• The existence of more offshore bank accounts, which could give the Obama campaign more ammunition.
• What Cassidy calls “politically explosive investments,” which could anger or energize the right and/or the left. Some possible examples would be if Romney directly benefited from Bain investments like some that have already been reported, such as companies that specialized in outsourcing jobs, or Stericycle, the biological waste company that specializes in disposing of aborted fetuses.
• Questions of how Romney accumulated potentially as much as $100 million in his Individual Retirement Account (IRA).

On top of that, the Obama campaign recently hit Romney with what is probably one of the most memorable and powerful attack ads from the last decade, if not longer. Unfortunately in politics, imitation is not the sincerest form of flattery. The Romney campaign responded with its own ad which set a series of headlines to Obama’s performance of Al Green’s “Let’s Stay Together.” The ad can’t be linked to or embedded because it was taken down from YouTube following a copyright claim by BMG.

The sustained attacks on Romney’s business record are clearly having an effect on the overall dynamics of the race and the national discourse. Searches for Bain Capital have increased on Google. Particularly worrisome from the Romney campaign’s perspective is the fact that of five out of the top ten locations where these searches are traced to come from key swing states (Ranked in numerical order: Virginia, Ohio, Pennsylvania, Florida and North Carolina. If you consider Arizona a swing state up for grabs this year, then six out of the top ten locations are swing states.) References to Bain Capital have also increased on Twitter. In other words, people are paying attention.

Romney has also been on the receiving end of rough criticism and second-guessing in the press. Check out this column by National Journal’s Charlie Cook, and this one by Business Week’s Josh Green, reviving Newsweek’s infamous “wimp factor” story from the 1988 campaign and turning it on Romney.

On the other hand, it is worth keeping in mind that Romney’s refusal to release the tax returns could be more damaging than whatever might be in the documents themselves. Remember John Kerry’s repeated refusal to release his Standard Form 180 in response to demands from the Swift Boat Veterans for Truth back in 2004? By the time he actually got around to doing that a year after the race, the records essentially confirmed/upheld the historical facts of Kerry’s military service and didn’t have any damning or damaging revelations. Ultimately, the tax issue is a problem of Romney’s own making, no matter how many questionable excuses (John and Teresa Heinz Kerry) he offers to justify his position of nondisclosure.

There is no easy solution for this, regardless of what Romney ultimately decides. The basic question he has to answer on whether or not to release more tax returns is if he prefers the devil he knows or the one he doesn’t.

Update: Unrelated to the tax returns issue, but still worth noting… The New York Times reports that Mitt Romney’s name and/or signature has come up in 142 documents during the period between 1999 and 2002, raising questions over when/if he left he had severed ties with or ceded control of Bain Capital during this period while he was running the Olympics in Salt Lake City.