In the broadest sense, though, the competitiveness revolution was good for the United States. In the 1970s, there were sound economic reasons to expect that other developed nations would gradually catch up to American living standards and per capita G.D.P. Instead, our rivals got rich, but we stayed richer. As Adam Davidson noted in last weekend’s Times Magazine, “even Europe’s best-performing large country, Germany, is about 20 percent poorer than the U.S. on a per-person basis.”
(Nicholas Kristof mentions in his column today that "Norway is richer per capita than the United States.")
But keeping America’s edge came at a cost. Our economy became more efficient, but also more ruthless and Darwinian. Our G.D.P. kept rising, but the new wealth was less evenly distributed. The revolution delivered growth, but at the expense of stability and certainty. And for many Americans, even the “modest net impact” of private equity buyouts cost them a solid, good-paying job.
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Still, just because the private equity revolution was necessary doesn’t mean that it was an unmitigated good. And for Mitt Romney to frame criticisms of Bain as just “the bitter politics of envy,” as he did last week, displays a tone-deafness that could cost him the presidency. No one — and certainly no politician — who has profited so immensely from an age of insecurity should ever appear to be lecturing the people who’ve lost out.
Instead, Romney needs to prove to anxious voters that he and his party have more to offer them than just Bain capitalism alone. To win the White House, he’ll need to promise not only competition that leads to growth, but growth that leads to broadly shared prosperity. To defend his revolution, he’ll need to show that he’s reckoned with its costs.
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