by Mitch Kokai
Senior Political Analyst, John Locke Foundation
Lost in the debates about Republican presidential nominee Mitt Romney’s wealth and tax returns is that fact that Romney has spent much of his time in recent years serving in public office or seeking public office. If Romney were truly the “greed is good” villain critics make him out to be, he could have made a lot more money, as the latest issue of Forbes documents.
Lots of people pay a high price for getting into politics, but no one has likely given up more, at least financially, than Mitt Romney. His decision to leave Bain Capital to rescue the Winter Olympics in Salt Lake City and pursue a political career was the most expensive decision of his life. Romney is still plenty rich, worth an estimated $230 million, but had he remained at Bain for the private equity boom he would be worth much more.
It’s usually pretty tough to calculate the opportunity cost of one man’s decision. But in Romney’s case it’s a little easier. He left Bain Capital just as the private equity boom was getting going and he was in an excellent position to profit from it. By changing careers, it’s reasonable to estimate the Romney left $1.77 billion on the table. He probably would be worth $2 billion by now. …
… Romney has consistently shown that he is willing to sacrifice huge sums of money in order to chase his political dreams. He spent $45 million of his own money to finance his 2008 presidential run. And he was ready to give up future fortunes when he ran for the U.S. Senate in 1994. Indeed, given Bain’s success in the 1990s and his lucrative exit package, losing a political campaign to Ted Kennedy may have been the best financial thing that ever happened to Romney. “I went on and did something which I cared very deeply about,” Romney has said. “Because I care about the country.”