ANALYSIS: Romney’s Target Electorate

As I mentioned in a previous column, the Presidential Race is also a Marketing Management issue. I am sure Republican nominee Romney, a former Governor and a successful businessman, is treating and analyzing it as such.

TARGET MARKET

RRR (Republicans Romney-Ryan) target the Independent Voters composing 5-10%

ASSUMPTIONS:

1.     RRR assumes that 43-48% right-leaning, loyal Republicans would vote their way no matter what;

2.     Romney also assumes that 47% of the electorate would vote for President Obama no matter what.

Romney described the 47% as people  “who pay no taxes” and “who are dependent upon government, who believe they are victims, who believe the government has the responsibility to take care of them, who believe they are entitled to health care, to food, to housing, to you name it.” He also says in a video, “My job is not to worry about those people. I'll never convince them they should take personal responsibility and care for their lives.”

As soon as this promotional message to potential campaign contributors or in business parlance “investors” was leaked or discovered, it generated various reactions. His own running mate Ryan called him “inarticulate”.  Famous Republican writer Peggy Noonan called his campaign, “incompetent”. Romney himself described his remarks, “inelegant” but did not back down – fully convinced that as a matter of strategy, it is better not to waste his and his contributors’ money, time and effort to the 47% electorate as he described.

As a political animal previously involved in both U.S. and Philippine elections, Romney’s message and assumptions made me curious. As I have done previously, I usually satisfy this curiosity by looking at the numbers known to the public and the Romney campaign.

PAY NO FEDERAL INCOME TAXES = 47%

Indeed, 47% pay no Federal Income taxes but as discovered by the media the former is divided into: 28.3% who pay the payroll taxes that sustain the Social Security benefits; 10.3% are the elderly whose main source of income is the non-taxable hard-earned Social Security pension; 6.9% are those earning less than $20,000; and .9 others.

ELECTORAL COLLEGE = STATES AS TARGETS

The Electoral College System changes the dynamics in the U.S. Presidential Race as compared to other democratic countries like the Philippines wherein every vote counts. In a winner takes all system, the former gets all the allotted electoral votes. In short, it is possible that you get more votes nationally but still lose because you obtained less electoral votes.

This is why both Presidential campaigns develop their strategies around the States. This is why they campaign based on what pollsters call the Blue States (Democratic-leaning), the Red States (Republican-leaning) and the Toss-Up States.

With Romney’s message and assumptions as stated above, it should be logical to many that the former is linked with the States strategy.

POOREST STATES

I decided to look at the poorest States in the United States ,which I thought Romney, based on his strategy, assumptions and message, determined they would go for President Obama no matter what.

Why? In these States, the average household income is $39,375 or less than $20,000 as average individual income. Those who live below the poverty line are averaging 19.5%.

These States are Tennessee, Alabama, Kentucky, Arkansas, West Virginia, and Mississippi.  Yet, according to the latest Rasmussen Electoral College Scoreboard, these poorest States are all going for Romney.

 
RICHEST STATES

The richest States in the U.S. are Maryland, Alaska, New Jersey, Connecticut, and Massachusetts.  The average household income is $66,270.60 and those below the poverty line average 10.78.  Most of the voters pay taxes. They are Romney’s kind of people, right?

Wrong.  Except Palin’s State of Alaska, all of them, per Rasmussen, are going for President Obama by wide margins. Yet, he guaranteed Palin’s absence in the Tampa convention.

GOVERNMENT AS A REVENUE SOURCE

Romney is very critical of persons, (natural or juridical) who derive their income from the government.  This is part of the message that he delivered to a group of funders.

The U.S. Federal Budget is bloated but it is not primarily funding the bureaucracy.  A substantial portion actually goes to the private sector. Lockheed Martin, whose 2011 revenue was $46.30 billion, for example, derived $39.98 billion as income from the U.S. government; Boeing in 2011 got 21.45 billion; General Dynamics, $19.47 billion; Raytheon, $14.76 billion; and United Technologies, $7.90 billion just to name a few.

Let us look at the numbers that deal with small businesses, disadvantaged entrepreneurs, women-owned enterprises, and targeted industries; trade associations; NGOs; innovators; exporters; and others who are beneficiaries of market development programs, financing and investments, grants, subsidies, research and feasibility studies assistance programs and other various government support that actually end up in the private sector. Even foreign aid because of the “Buy American” Rule actually benefits  American contractors and consultants. They are billions and cumulatively trillions in dollars.

There are unemployment and Social Security benefits because there were insurance premiums and contributions respectively paid over a period. Beneficiaries, most especially the elderly, have earned a vested right.

Romney and his campaign staff might want to review their message, assumptions and strategy. Time is of the essence!

Figuring Out The U.S. Presidential Race

Figures, numbers, facts, and values! When checked and verified, they relay strong messages. It is next to impossible to argue against them. Contra factum argumentum non valet ilatio  (Arguing against facts is an invalid inference).

To those who speak English as a second language, phrases like, “let us figure this out,” “sorting out the numbers”, and “numbers tell better stories” become even more significantly meaningful.

Looking at the current U.S. Presidential race, the Republicans have a built-in competitive edge. The unemployment rate is still high at 8.1%. Polls show that 62% of the electorate think we are in the wrong track/direction; there is widespread dissatisfaction with the pace of the recovery; the suffering of those who have been out of job for more than a year continues; there is the continuing budget deficit; the tremendous increase of the country’s debt.  And the overwhelming opposition to the Obama Health Care Law by the Republican base should translate into winning numbers for their presidential timber, right?

Wrong.  In the latest poll conducted by the NBC News and the Wall Street Journal from September 12-16, 2012 and published on September 18^th, Obama  leads Romney by 50% to 45% among likely voters.

In another poll conducted by UPI from September 8-14, 2012, 49% of likely voters said they will vote for Obama, 45% said Romney.  A Rasmussen report presents a closer race, (Obama – 47%, Romney – 45%) but the latter’s reading of the Electoral College tells a better story.

According to Rasmussen, today Obama has 247 electoral votes; Romney has 196; and Toss Up States – 95. Among the Toss-Up States, Obama leads in all except in Missouri.  Furthermore, Obama’s lead in the swing States are widening. In Wisconsin, the home State of Romney’s VP Ryan, the CBS-New York Times poll which was conducted from September 11-17, 2012, Obama is ahead with 51% to Romney’s 45%. In Virginia, a Washington Post survey shows 52% for Obama and 44% for Romney. Even the latest poll conducted by Fox News give Obama the lead in Florida 49-44; and in Ohio, 49-42.

In a close race, it is always wise to rely on your home State. Gore lost to W. Bush because he failed to deliver Tennessee, his home State where he was even an elected Senator before becoming Vice President. Romney has virtually two home States: Michigan where he was born and raised; and Massachusetts where he was even an elected Governor.

In Michigan, a survey conducted by MRG from September 10-15, 2012 shows Obama leading Romney 48% to 42%. In Massachusetts, the latest survey of Public Polling shows Obama with 57% and Romney with 39%.

I have two close friends who are very serious, sincere, committed and persuasive Filipino Republican leaders. In fact, if they go back to the Philippines, I am sure that both could get elected either as Governor or Congressman in their respective provinces.

In the United States, one lives in California and the other resides in Pennsylvania where they command a following. My objective analysis is that in California with 55 electoral votes, even if my friend registers and convinces most, if not all,  of the Filipinos to vote for Romney, the votes would be rendered useless because of the Electoral College System. According to the latest survey conducted, Obama leads 57% to 35%. In fact, Asian Americans are going for Obama overwhelmingly. They give him a favorable rating of 73% compared to Romney’s 27%.

In Pennsylvania where my other Republican friend lives, the numbers tell a similar story.  In the survey conducted by Muhlenberg/Morning Call from September 10-16, 2012, Obama leads Romney 50% to 41%. Again, even if most if not all of the Filipinos in the State vote for Romney, the Electoral College System renders them useless.

Why do the numbers favor Obama’s re-election despite the continuing economic woes as reflected in the unemployment rate, budget deficit, debt burden,  and rising healthcare costs?

The figures also provide the answer. In the NBC/WSJ survey, Obama is deemed better prepared to lead the country by 47% to Romney’s 36%.  With 42% more people now thinking that things would be better in the next 12 months while just 18% think it will get worse, there is more optimism today than in earlier surveys.

On “looking out for the middle class,” Obama is favored 53% to Romney’s 34%. As a Commander-in-Chief, Obama is preferred by 45% over Romney’s 38%.  On dealing with issues concerning women, Obama is preferred two to one.

Resources, Organization, and Image (ROI) are factors that affect presidential runs. I discussed this to some extent in last week’s column.

Romney has the Resources not only with his own personal wealth, the support of rich friends, and the Super PACS.  He can battle with Obama on this factor.

Romney has the Organization but may not be as committed, as effective, as efficient and as competent as the machinery of George W. Bush who beat Gore and Kerry. Other Republicans have, in fact, criticized his campaign as incompetent.

His Image has also become an issue. While earlier he was seen as a better Economic Manager than Obama by a wide margin, he is now running even with the latter.  With his gaffes in the foreign policy arena; and his image of “not caring about 47% of Americans because they do not pay taxes and would vote for Obama no matter what”, there is a growing demand among some Republican political consultants to re-organize and clean up his Image. Right now, he is no Reagan, no Bush 1, and no Bush 2, not even Ryan per some pundits.

Can Romney still win?

Numbers should help give the answer: The amount of time allotted to prepare for the debates; the number of points delivered by Romney in all the debates; the number of days spent for the remaining campaign season until election time; the amount of time and effort spent by a big number of campaign volunteers; the unemployment rate in the months preceding the election; the Dow Jones volume; and the substantial amount of money spent for ads and infomercials destroying Obama, and projecting a better Image for Romney.

A show of a little more caring toward the “victims” of an unjust society coupled with prayers might help. After all, miracles do happen!

R O I on R O I

Return On Investment on Resources, Organization and Image!

A Presidential Campaign is a management issue. To be effective and successful, it would take efficient planning, organization, leadership, and control. It is more specifically a marketing, production, human resource, legal, and investment management problem.

To analyze it we normally look at the 4 Ps (Product, Price, Promotion, and Position/Place) of Marketing, the 4 Ms  (Manpower, Machinery/Method, Materials, and Measurement), the 4 Hs (Head, Heart, Hand, and Health) of Human Resources, the 4 Cs (Criminal, Civil, Commercial/Consumer, and Cyber) of Legal, and most importantly, the 4 Rs (Return, Revenue, Reduction (Cost), and Resale/Replacement) of Investment Management.

As I had written in a grad school paper, oral presentation, and lectures in various seminars and conferences, I call it the 4s of BM (Business Management/Benjamin Maynigo).

I usually ended my presentation by saying, “May the 4s be with you.”

For lack of space, I will not discuss in detail the current U.S. Presidential Campaign according to the 4s mentioned above but will focus on three areas that still touch on the 4s. These areas are Resources, Organization, and Image (ROI). They are interdependent. Each one feeds the other to be successful.

RESOURCES

A winning Presidential Campaign needs sufficient resources. You need it to build an efficient and effective Organization and to create a very favorable and electable presidential Image. It is necessary to recruit, train and maintain the “best and the brightest” manpower; to purchase the right machinery, equipment and tools required for the campaign; to produce and/or buy the campaign materials; to fund infomercials, buy TV timeslots, and to fund research and response teams.

This is why campaign fund-raising is a battle in itself.  This is true in the current U.S. Presidential Campaign.

Bill Allison, Editorial Director at the Sunlight Foundation, a nonprofit, nonpartisan organization dedicated to increasing transparency in government reported the following; “In aggregate, Obama's reelection vehicles have raised $134 million more than those of Romney to date. We previously noted that in order to catch Obama, Romney had a high mountain to climb. Before August's numbers were announced, we calculated that the GOP nominee would need to raise, in each of the remaining months before the election, $44 million more than his rival. Since Obama raised about $2 million more than Romney in August, the challenge got that much more daunting - in September and October, he'll need to outpace Obama by an average of $67 million.”

In the same report, Allison also noted, “Through April, Obama and Democratic groups supporting his re-election bid have raised nearly $450 million during the election cycle and have more than $150 million in the bank. Romney and Republicans backing him have collected more than $400 million during the same stretch and have about $80 million at their disposal. Romney raised $15 million this week during three days of fundraising in New York.

Gone is the 10-to-1 cash advantage that Obama held at the end of March.”

With the judicial interpretation that Free Speech includes expressing your preference through money, the birth and proliferation of well-funded Super PACs have given the phrase, “money talks” greater meaning and significance.

ORGANIZATION

“Organization determines everything,” Lenin once said. A successful Presidential Campaign must have a smart, strong, efficient, effective and competent organization. It is needed to help develop resources; to sell a winning presidential Image; to reach the targeted voters and deliver them to the voting booth; and to manage political gatherings such as conventions, campaign stops, caucuses, and the like. It takes efficient planning, leadership and control to run this type of organization functionally and structurally.

In the 2008 presidential elections, Obama’s success was achieved with the support of smart campaign managers, labor unions, black, Hispanic, women, liberal groups, and a substantial number of young volunteers conducting voter registration, making phone calls, and even raising funds.

In this year’s campaign, Obama expects to obtain a similar organizational support from the same groups.

The 3 Rs (Republicans, Romney and Ryan) would be relying on the extreme conservatives, the tea party members, the evangelicals, pro-lifers and the Republican faithful for its organizational support that would perform the campaign tasks.

Organization, indeed, is likewise a battleground in this campaign.

IMAGE

In 2008, an inexperienced Obama was running under conditions of a collapsing economy and in the midst of two wars. His drumbeaters projected an image of a future President who brought Hope and Change. That Image successfully penetrated the hearts and minds of the American electorate, thus making him President of the United States.

He is now an incumbent asking to be re-elected to continue and finish what he started. As promised, he ended the war in IRAQ. He claims that American troops would be withdrawn from Afghanistan as the War ends by 2014. He gave the orders to kill Al Qaeda’s leader, Osama Bin Laden. He was also awarded a Nobel Peace Prize. The Arab Spring has started bringing democracy in certain countries where dictators were supreme.

He stopped the downward spiraling of a collapsing economy. He saved the auto industry, keeping General Motors alive and well. The unemployment rate has been going down from its peak at 10.7 percent in October 2009 to 8.1 percent in August 2012. The Dow Jones Industrial Average rose from 6,500 when he first started to 13,300 today. That’s more than double, thus – saving the 401 Ks of many employees and retirees. The inflation rate remains low – 2.4 percent, and the Prime Interest rate is only 3.5 percent. We now have universal healthcare.

On its face, this should present an image of a strong Commander-in-Chief and an effective President in Foreign Affairs as well as an efficient and effective Economic Manager.

But we continue to have budget deficits and our sovereign debts have substantially increased. The unemployment rate is still too high!

This brings Romney and Ryan to the rescue! Romney is projecting the Image of a successful businessman as reflected in his stint in Bain Capital; a good government official based on his tenure as Governor of Massachusetts; and a sound manager as proven when he ran the successful Winter Olympics in Utah.

For this, he assures the electorate that he could turn the economy around and lower unemployment rate further and closer to full employment. His choice of Ryan as his running mate also reinforces their determination to lower the budget deficit and the country’s debt knowing how Ryan’s budget and tax plans address the issue.

The question remains, if you invest your time, effort, and money in developing or contributing to Obama or Romney’s Resources, Organization, and Image (ROI), what would be the Return On Investment (ROI)?

What is the ROI on ROI?

It is a legitimate and compelling question to ask.

Cause That Both Parties Could Support

My barber asked his friend who was attending the Republican National Convention,
“How is the platform?”

His friend’s answer was, “Well-carpeted and fully vacuumed.”

Of course, the real intention was to find out the details of the Republican Party’s platform – the fundamental set of ideas, policies and proposed programs that the party envisions to accomplish when given the opportunity to govern.

However, experience shows that party platforms are seldom read and actually disregarded.

This seems to be true in many democratic countries that follow the republican presidential system.

In the last Presidential elections in the Philippines, I endorsed Benigno Aquino III to be president. I read his party’s platform but I knew that it would be ignored so I disregarded it. This is what I wrote as his platform instead:

“On the reforms needed to satisfy the E-Generation, he has a built-in Platform of Government. It is a product of the People Power revolution, written by wise men personally chosen by CORY, and approved, ratified and therefore, co-owned by the Filipino people. It is clear, brief and concise. It is executable, enforceable, mandatory and supreme. It is backed by implementing statutes, adhering legislation, accompanying executive orders, regulations and jurisprudence. It is protected and defended by the Armed Forces and police agencies as well as adhered to by every executive, legislative and judicial officer. It is the CORY CONSTITUTION. Others are encouraged to adopt it too but at this point of our history, the best person trusted to execute, enforce, obey, protect and defend it, is Cory’s son, NOYNOY.”

Surely, it is understood that the aforementioned Platform of Government is something that cannot be ignored. The truth is every Chief Executive, once he takes his oath of office, is mandated to execute, enforce, obey, protect, and defend the Constitution together with all the laws, regulations, executive orders and jurisprudence.

This is true for the elected President of the United States as well. Of course he hopes that, working with the new Congress, laws that he wants passed and implemented would be included in this mandated platform.

Party Conventions happen. They are traditional events that expose rising political stars. They are really what we call “INFOMERCIALS.” Each party is given several hours daily for several days of free TV, radio, print, and now social media to promote its presidential candidate, select Senatorial and Congressional candidates and others.

I am withholding my assessment on how effective the INFOMERCIALS were until both conventions-are finished. I will also wait for the debates to assess the chances of the candidates in becoming President of the United States.

However, there is one cause that attracted my attention as I read about the two conventions. The most significant issue, which both parties agree on, is jobs and/or job generation.

Gary Spiro is the president and CEO of the Consumer Electronic Association (CEA) that owns and manages the annual International CES held in Las Vegas, Nevada.

I have been attending CES every year and correspondingly, listening to Gary Spiro as he opens the very successful event.

Attending the Republican and Democratic National Conventions, he and the Innovation Movement are promoting a “Common Cause for Both Parties.” I support the cause and also decided to join the Innovation Movement.

Spiro says, “We have to think economically, not politically, about building a future for our country.” He is pushing for what he calls “strategic immigration”. He supports the changes proposed by Rep. Zoe Lofgren (D-Calif.) , “which would allow U.S. companies to attract and retain immigrants with degrees in STEM (Science, Technology, Engineering, Mathematics) fields and create a new green card for foreign-born entrepreneurs who begin startups and create jobs.”

Spiro also likes the proposal of Rep. Darrel Issa (R-Calif) to reform the Immigration and Nationality Act “to eliminate the Diversity Immigrant Program and reallocate those visas (about 55,000 a year) to immigrants with advanced degrees.”

The legislation (S 3217) introduced by Sens. Marco Rubio (R-Fla.), Chris Coons (D-Del.), Jerry Moran (R-Kan.) and Mark Warner (D-Va.) would give foreign investors and certain highly educated students a streamlined path to citizenship.

In his article, Gary Spiro wrote that a study found that 84 percent of patents had a foreign-born inventor. He also cited that in the equally critical healthcare sector, 79 percent of patents for pharmaceutical drugs or drug compounds were invented or co-invented by someone foreign-born.

Outside of I’s like Inflation and Interest rates for economic concerns, and Israel protection as a foreign issue, Innovation is being proposed as a center-piece for job creation.