Mitt Romney's campaign is touting his “record of success” as governor of Massachusetts from 2003 to 2007 as a reason to elect him president.
“As governor, Mitt Romney closed a $3 billion deficit without raising taxes, balanced four budgets, and left $2 billion in the state’s rainy day fund,” said campaign spokesman Ryan Williams in a statement on June 25. “If President Obama had even half of Mitt Romney’s fiscal record, he’d be running on it.”
But our CNBC study ofAmerica’s Top States for Businesstells a more nuanced story about Romney’s record.
While our study debuted in July 2007 — some six months after Romney left office — much of the data cover his final year as governor. We found Romney left Massachusetts in competitive shape after his single term, but with some notable gaps.
Massachusettsfinished 12thoverall in our 2007 CNBC rankingsof America’s Top States for Business. The Bay State performed well in its traditional areas of strength: No. 1 in Education, No. 2 inAccess to Capital and No. 4 in Technology & Innovation. InBusiness Friendliness, which measures the legal and regulatory climate, the state finished a respectable 13th.
But Massachusetts tied with Arkansas for 41st in theEconomy category, and was one of most expensive states in which to do business and to live (ranked 40th in the Cost of Doing Business category; tied for 43rd in Cost of Living one). Its Workforceranking was in the bottom half at number 26, and its Infrastructure ranked 38th.
As Romney was leaving office in January 2007, the national recession was still nearly a year away, but the Massachusetts economy was already losing steam, and job growth had slowed considerably.
In December 2006, according to the U.S. Bureau of Labor Statistics, unemployment in Massachusetts stood at 5.3 percent, compared with the national rate of 4.5 percent. The state added about 35,000 jobs in 2006. The state of Washington, with a similar-sized population, added more than 83,000.
Educated & Healthy
Massachusetts’ poor performance in the cost categories was largely due to factors beyond Romney’s control, such as utility rates, wages and housing rental costs. In other areas, such as business taxes and workers’ compensation costs, Massachusetts performed well.
Massachusetts’ vaunted education establishment — including some of the top universities in the world — predates Romney’s governorship, of course. But our study suggests he was a good steward. The state’s public schools performed well at all levels, and while the Romney campaign may not wish to highlight this now, per pupil spending was among the highest in the country.
According to our study, quality of lifein Massachusetts also ranked among the highest in the country as Romney left office. That may have had something to do with another aspect of his governorship that his campaign has chosen not to emphasize: health care reform. The Romney plan, complete with an individual mandate, began taking effect in mid-2006. When we compiled our data in the first half of 2007, we found Massachusetts to be among the healthiest states in the union, contributing to a No. 3 showing in the Quality of Life category.
What about the Romney legacy in Massachusetts? Since he left office, Massachusetts has performed reasonably well in our study, including a place in ourelite top five in 2010. Whether that is due to Romney or his Democratic successor Deval Patrick — or a combination of both —is for others to decide.
As for the state’s finances, the “rainy day fund” did indeed peak above $2 billion as Romney left office, according to state data, but tax collections were peaking around that time as well.
And while the Romney campaign can accurately claim he balanced four budgets as governor, it is also worth noting that state law in Massachusetts requires a balanced budget.