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First Thoughts: Romney's fatal flaw

Penalty-vs.-tax episode exposes Romney’s fatal flaw: Conservatives simply don’t trust him… Romney’s verbal gymnastics… Will tomorrow finally allow Romney to change the subject to the economy after three weeks when it hasn’t been the dominant issue?... Obama embarks on two-day bus tour, hitting areas he easily won in ’08… The tour’s name, “Betting on America,” touches on three messages: 1) auto bailout, 2) outsourcing vs. insourcing, and 3) Romney’s offshore accounts… And this week’s 10 hottest advertising markets.

*** Romney’s fatal flaw: So just two days after Romney senior adviser Eric Fehrnstrom referred to the federal health-care mandate as a penalty and after the campaign issued a press release also calling it an “unconstitutional penalty,” why did Mitt Romney reverse course yesterday and say it’s a tax? Look no further than today’s scathing Wall Street Journal editorial, which blasted the Romney camp for calling it a penalty. “In a stroke, the Romney campaign contradicted Republicans throughout the country who had used the Chief Justice's opinion to declare accurately that Mr. Obama had raised taxes on the middle class.” More: “Mr. Romney favored the individual mandate as part of his reform in Massachusetts, and as we've said from the beginning of his candidacy his failure to admit that mistake makes him less able to carry the anti-ObamaCare case to voters.” This penalty-vs.-tax episode highlights what many conservatives see as Romney’s fundamental flaw: They simply don’t trust him, especially when it comes to health care. That’s why we’re seeing conservative handwringing over Romney -- from the WSJ, the WSJ’s owner and leading conservative media mogul Rupert Murdoch, and Jack Welch -- even though the race is so close.

*** The John Kerry vacationing comparison: By the way, the WSJ editorial also went down the John Kerry-comparison road and even took a shot at Romney for the jet ski photo-op. “[T]he Obama campaign is assailing Mr. Romney as an out-of-touch rich man, and the rich man obliged by vacationing this week at his lake-side home with a jet-ski cameo.” In short: It was a brutal takedown. And conservatives now have their “told you so” moment if Romney loses.

*** And Romney’s verbal gymnastics: When you think about it, Romney never had to truly deal with his fatal flaw on health care. Yes, he gave that health-care PowerPoint speech in Michigan in May 2011. And, yes, he was asked questions about the issue during the 20-odd GOP debates in which he participated. But he never REALLY had to reconcile his health-care law with President Obama’s -- with a campaign team capable of going toe to toe with him -- until last week’s Supreme Court decision. As for his explanation in calling the mandate a tax, his verbal gymnastics would have impressed even the Russian judges. First, he technically didn’t disagree with Fehrnstrom’s original take; he simply conceded that the Supreme Court called it a tax. “Well, the Supreme Court has the final word, and their final word is that Obamacare is a tax. So it’s a tax,” he said. And then he painfully tried to explain why the federal mandate is a tax, but Romney’s state mandate is a penalty. “Actually the chief justice in his opinion made it very clear that at the state level, states have the power to put in place mandates. They don’t need to require them to be called taxes in order for them to be constitutional.” 

*** Will tomorrow allow him to change the subject? Perhaps no one is looking forward more to tomorrow’s jobs report than Romney -- as simply a way to change the subject. If you think about it, the past three weeks or so have been dominated by issues other than the economy and not-so-coincidentally, it coincides with Romney’s roughest poll patch of the general since the primaries. The president’s immigration announcement. The Supreme Court’s ruling on Arizona’s immigration law. And the Supreme Court’s decision on health care. All of these issues have put Romney on the defensive, and all of them have exposed some of his flaws as a candidate. Tomorrow has the potential to get him back on the subject he wants this election to be about: the economy.

*** On the road again, just can’t wait to get on the road again: Obama today begins his two-day “Betting on America” bus tour through two battleground states – toss-up Ohio and Lean-Dem Pennsylvania. He starts with remarks at 11:40 am ET in Maumee, OH (just outside of Toledo), and he won that county with 65% of the vote in ’08. He then speaks in Sandusky, OH at 3:40 pm ET, and he got 56% of the vote in that county four years ago. And he concludes the day with a speech in Parma, OH (outside of Cleveland), and he won that county with a whopping 69% of the vote. Meanwhile, the Romney camp, per NBC’s Andrew Rafferty, is dispatching two potential VP picks -- Louisiana Gov. Bobby Jindal and former Minnesota Gov. Tim Pawlenty -- to bracket the president on his bus tour.

The Daily Rundown's Chuck Todd explains why Mitt Romney needs to win at least one swing state in the industrial Midwest.

*** What “Betting on America” means: The theme of this two-day bus tour touches on three subjects. First, it allows him to highlight the auto bailout in the Industrial Midwest (and on the heels of the big jump in sales). Second, it gives him the opportunity to highlight that Washington Post article (which the Romney camp disputes) noting that Romney’s Bain Capital invested in firms that outsourced work to China and India – a powerful charge in Ohio and Pennsylvania. And third, it’s a not-so-subtle inference to the fact that Romney doesn’t even keep much of his money in the United States. After all, this bus tour comes after Vanity Fair wrote about Romney’s complicated offshore accounts in Bermuda and the Cayman Islands, and after the AP focused on one of these Bermuda accounts. “Based in Bermuda, Sankaty High Yield Asset Investors Ltd. was not listed on any of Romney's state or federal financial reports. The company is among several Romney holdings that have not been fully disclosed, including one that recently posted a $1.9 million earning — suggesting he could be wealthier than the nearly $250 million estimated by his campaign.” Remember, political slogans are only picked if they both highlight a pro and a con, and this “betting on America” is a triple entendre.

*** Obama admin. to file WTO complaint against China: And just as Obama is in Ohio today to highlight the auto bailout, his administration “will file an unfair trade complaint today against China's new duties on some American-made cars and sport utility vehicles, including the Toledo-made Jeep Wrangler,” the Toledo Blade writes. “A senior administration official told The Blade Wednesday the United States will file the case with the World Trade Organization in Geneva, accusing China of putting illegal duties on $3.3 billion worth of U.S.-made auto imports.” The paper adds that Obama is expected to discuss this move during his speech in Maumee at 11:40 am ET.

*** This week’s 10 hottest advertising markets: As we mentioned earlier this week (but not in First Thoughts), here is our weekly look at the 10 hottest advertising markets for the week (in terms of advertising points from 7/2 to 7/8). Three of the markets are in Colorado, including No. 1 Colorado Springs; two are in Florida; two are in Virginia; and another two are in Ohio. AFP is the Koch Brothers’ Americans for Prosperity and Priorities is the pro-Obama Priorities USA Action. By the way, this is the first week since the general election began when one of American Crossroads, Crossroads GPS, or the pro-Romney Restore Our Future were on the air.

1. Colorado Springs, CO (Obama 950, Romney 900, AFP 250, Priorities 200)
2. Orlando, FL (Romney 985, Obama 700, AFP 150, Priorities 150)
3. Tampa, FL (Romney 950, Obama 580, AFP 215, Priorities 200)
4. Richmond, VA (Obama 775, Romney 690, Priorities 250, AFP 200)
5. Roanoke, VA (Obama 830, Romney 720, AFP 350)
6. Reno, NV (Obama 850, Romney 715, AFP 150)
7. Grand Junction, CO (Obama 775, Romney 550, AFP 350)
8. Denver, CO (Obama 750, Romney 650, Priorities 40, AFP 125)
9. Columbus, OH (Obama 660, Romney 530, Priorities 360, AFP 100)
10. Cleveland, OH (Obama 765, Romney 580, AFP 125, Priorities 125)

Countdown to GOP convention: 53 days
Countdown to Dem convention: 60 days
Countdown to Election Day: 124 days

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