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Ron Paul—and the ‘Pink Slip’

1:28 PM, Feb 1, 2012 • By JIM PREVOR
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Jack Welch, the former CEO of General Electric, and his wife Suzy, the former editor of the Harvard Business Review, kick off their new management column for Reuters with a piece titled “Ron Paul and the pink slip that could decide the election.”

In their column, the Welches try to apply lessons from how businesses fire executives to the political challenge the GOP faces in keeping Ron Paul’s supporters in the Republican party—and how a big tent GOP would govern. The ideas sound appealing but they simply don’t work.

The Welches put it this way:

Have you ever woken up in the morning knowing you have to let someone go and just felt sick to your stomach? It’s the worst part of work, isn’t it? . . .

By the way, this is a column about Ron Paul . . . The maxims of business and politics don’t always overlap, but when it comes to parting ways, they sure do. In business, firing someone incorrectly is a disaster that can haunt you for years. Same in politics.

The Welches urge GOP leadership and the Republican nominee to use “generosity and respect” in dealing with Paul. In fact, they say the Republicans have a perfect example of how to conduct themselves:

GOP leadership has an excellent example of how to correctly part ways right under its nose — in President Obama’s masterful handling in 2008 of Hillary Clinton, a bitter opponent right to the end, and Joe Biden, an early loser in the Democratic primary race. . .

And so it must be with the RNC and Ron Paul . . . Whatever speaking role Dr. Paul wants at the convention, give it to him. If he wants some sort of advisory role in the new administration, the answer is: “Of course.” Like a business leader designing a severance package with a key player, the GOP leadership’s mindset must be: “When he walks out that door, Ron Paul is going to be a friend for life.”

There is little question that in business one should always be generous toward those whose employment is terminated. The upside is clear: You may avoid lawsuits, labor board claims; you may have someone less anxious to turn against your company when working for a competitor, supplier, or customer; sometimes, you may even want the person back again in other circumstances.

The downside is almost always only money. It’s an investment to give a generous severance package and hope that the goodbye will be amicable enough to avoid future problems. If the company has money, the prudent course is pretty clear.

The Welches are straining, though, in trying to apply this business practice to politics. It is, in fact, not clear at all that embracing Ron Paul in a meaningful way helps the Republican cause.

Sure there is common ground among Republican candidates on some issues, such as economics, which is fine. But if the Republican nominee adopted Paul’s policies on substantive areas where there are real differences of opinion – say foreign policy – it might appeal to many Paul supporters, but it would, of course, alienate most members of the Republican party.

As such, the Obama/Clinton/Biden analogy rings hollow. Though every candidate might have his own specific plan, and one can prefer a candidate for myriad reasons, there was never any serious ideological split between these candidates. So handling the end of the primary season and attempting to unify the party, required massaging egos and satisfying personal ambition. Thus, the approach the Welches are proposing here – giving consolation prizes to the losers so they feel connected and valued – makes sense only in that context.

When, however, there are substantive policy differences, the efforts to make the losers feel valued can wind up allowing the public to associate the policies and beliefs of the losers with those of the eventual nominee.

Consider Pat Buchanan’s 1992 speech at the Republican National Convention. Buchanan was given the opportunity to give the keynote address and endorsed the reelection of President George H.W. Bush. In a sense, Republican leadership followed the advice the Welches are urging on this year’s eventual nominee: “Whatever speaking role Dr. Paul wants at the convention, give it to him.”

Yet it is not clear that it helped the Bush/Quayle ticket. Many analysts believe that Buchanan’s angry speech, which, heavy to social issues such as abortion, became known as the “Culture Wars” speech, alienated moderates from the ticket.

There are two points to make here. First, the generosity of a business executive being kind personally and economically to a fired employee is not analogous to a presidential nominee being generous by offering a losing candidate a chance to present his views or to influence the new administration’s policies. In the business world, there are generally only two players – the business and the fired employee – that have to be satisfied. In politics, any move toward a losing candidate’s positions will cause a reaction by those who opposed that candidate’s positions. So the policies that worked in business won’t work in politics.

The second point is that in politics the substantive goal matters: Even if the Welches’ strategy might work—as in help a Republican win the election—it could change a party so much that it would alter its principles and what it stands for. In business, the goal is to make money. As such, the question of giving generous severance, for example, boils down to a decision as to whether giving more severance will “pay” by reducing lawsuits, increasing community reputation, etc.

In politics, the goal is to implement policies that one believes in. This puts close to an insurmountable block before the Welches’ proposal. If Paul’s supporters want an isolationist foreign policy and the Republican nominee’s supporters want an active foreign policy, neither group of supporters would be happy.

Allowing a speech at the convention that is discordant with a nominee’s positions is only going to lead to confusion and alienation. Bringing in advisers whose advice a nominee has already decided to reject is a recipe for a blow-up later on when supporters learn the advisory role was disingenuous.

The eventual nominee should certainly be courteous and, where common ground exists, it can be emphasized. Sometimes there may be regional or parochial issues on which one can compromise. But the primaries and caucuses are designed to ferret out the basic policies that the people support. A nominee needs to stand with those positions and reject a supposed deal in order to win an election. The most likely outcome of such a deal is that the candidate willing to bend so generously will be seen as unprincipled and will lose both the election and the chance to govern effectively.

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