The Republican Party's crisis of capitalism did not begin this month in New Hampshire.
Party loyalists from Senator Jim DeMint of South Carolina to Rush Limbaugh are forming a defensive cordon, some around Republican front-runner Mitt Romney, others around capitalism itself. Newt Gingrich, who is under intense pressure from party leaders to halt his attacks on Romney's tenure as a private equity manager at Bain Capital LLC, is now trying to stigmatize Romney without criticizing the economic system that enabled his firm to thrive. Some of the things Romney did at Bain, Gingrich said, "don’t look like capitalism. They look like rich guys looting companies, taking all the cash and leaving behind all the unemployed.”
Rick Perry has similarly veered off the free-market freeway, accusing Romney, via Bain, of an exploitative brand of "vulture" capitalism.
Romney invited the attacks by saying he'd been a "job creator" at the firm, claiming credit for 100,000 new jobs. It's a preposterous assertion, as Bloomberg View columnist Ezra Klein made clear, but it's also perhaps beside the point.
Long before Bain came under attack, Representative Michele Bachmann of Minnesota and even Romney himself had publicly grumbled about "crony capitalism." In addition, Romney for months has been attacking free trade with China. The "crony capitalism" line was variously applied to the Obama administration's takeover of General Motors and the pay-to-play practices of Texas Governor Rick Perry. But mostly it seemed to concern unspecified transgressions by unnamed actors.
All of these debate-ready attack lines have a common lineage. The distance from "crony capitalism" to "vulture capitalism" to "rich guys looting companies" isn't very far. They are variations on a theme, colloquial acknowledgements that something somewhere went awry in the economic system. Just as important, they avoid a clear critique of exactly what that something was, settling instead for vague inferences about bad behavior.
President Obama offers an explanation of what went wrong: unregulated markets and unhindered inequality. He has proposed solutions: Dodd-Frank to regulate the markets, and higher taxes on the wealthy to restrain rising inequality. Republicans are free to dispute both the diagnosis and the treatment, but there's no denying the coherence of the analysis.
Republicans, in contrast, have blamed the financial crisis on everything from Fannie Mae and Freddie Mac to Obama himself, who took office after the economic free-fall was well under way. Their proposed remedies -- a return to the regulatory regime in place prior to the crisis, reduced government spending and still lower taxes on the wealthy -- are Republican mainstays of every campaign since at least 1980. The prescriptions don't even acknowledge that a crisis occurred.
Sooner or later, the Republican nominee (and that sure looks like Romney) will have to name names. Not names in the sense of culprits, but of causes. As the vicious fight over the supposed predations of Bain indicates, the current explanations aren't cutting it -- even in a Republican primary in which the premises are accepted.
Romney's career in private equity was bound to be a political vulnerability. What's making it worse, giving the finger-pointing at Bain more salience than it merits, is the lack of a credible Republican narrative of the financial collapse and its aftermath. Something big happened to American capitalism in 2008. The Romney campaign may want to think a little harder about what exactly that was.
(Francis Wilkinson is a member of the Bloomberg View editorial board.)