What Obama and Romney Must Do to Win

To win the election, Mitt Romney must direct the campaign back to his ability to handle the economy.

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Sydney Finkelstein is a professor of strategy and leadership at the Tuck School of Business at Dartmouth College and the author of Why Smart Executives Fail.

The presidential election is being framed as a heavyweight battle of political philosophies. And there is no doubt that voters firmly entrenched in camps on the left and right will be fully supportive of their standard bearer in November. But the election won't be decided by the 90 percent who are true believers, because when all the histrionics are over they will fight themselves to an exhausted draw. 

This election is absolutely about how people living on the metaphorical border of red and blue states think about President Barack Obama and former Gov. Mitt Romney. People want things to be better, for themselves as well as for their friends, families, and communities. Both sides are arguing for their rival economic plans, but independent voters cannot possibly be certain that one approach is superior to another. These people are not doctrinaire in their thinking, and that's why they are undecided. 

[See a collection of political cartoons on the 2012 race for the White House.]

What will sway them more than anything else is confidence. They want to believe that the future will be better, and they will vote for the man who most engenders the confidence that he can make that happen. This is especially true when the economy is struggling, as it is today. Trust and confidence are the essential fuel that drives the American economy.

The good news for both candidates is that you can get to the Holy Grail of confidence in more than one way. For Romney, that path must be via his competence as a manager, business leader, and turnaround expert. And most assuredly by not playing what Paul Krugman calls the "confidence fairy."

[See a collection of political cartoons on Mitt Romney and his business experience.]

Despite a seemingly endless array of missteps on the campaign trail in recent weeks, Romney's track record in business is quite impressive. The importance of his track record for motivating confidence among the electorate accounts for the relentless attacks, first during the primaries and now during the election campaign, on his work at Bain. 

It's also why his tax returns are relevant. Was there something he did at Bain that wasn't right? How did he amass that wealth? Were there shady deals? Would releasing his tax returns reveal something about all this? If anything, the recent release of 2011 tax returns along with meaningless "averages" from past years hurts more than it helps. As long as the details remain in the vault, people will wonder. If people are uncertain that his success is well-earned, they can't be sure about his competence, and if they are not sure about his competence, he just can't win over all those people who need to envision a Romney presidency ushering in an era of confidence. Romney's path to the Holy Grail requires greater transparency than he has thus far been willing to live with. That's a problem.

[RELATED: Take the U.S. News Poll: Did Mitt Romney Release Enough of His Tax Returns?]

Obama has his own problems on this score. The irony is that his message of hope and change that was so powerful four years ago would be perfect today, if it hadn't already become almost fully depreciated. He's already played that card, and there's no doubt it accounted for much of his dramatic success in 2008. Unfortunately for the president, "been there, done that" doesn't help him much.

So if not hope and change, what could it be? Obama's path to giving people a reason to believe again rests with his charisma and the famous "likeability factor." Imagine a four-year run of the type we just had, and so many people are prepared to give the top guy another chance. If it were Romney who was the president these last four years, he'd already be retired at his New Hampshire estate. That's because there are data one can look at to see if competence is really there, but the charisma play requires no such practical test. Obama's economy is not healthy, but we didn't hire him four years ago to do that; we elevated Obama to the Oval Office because of how he made us feel about the country and ourselves. He made us feel good, yes, he gave us confidence, and we trusted him to do the right thing. 

Today we know much more. Even though the state of the economy in 2012 is not nearly as dire as it was in 2008, it is the most pressing issue of the day. Obama is asking for more time to finish the job, and perhaps that is a reasonable request to make, but his ability to get extra time will depend more on our attachment to him as a leader and less on our unwavering belief that he's the most competent man for the job.

[See a collection of political cartoons on Obama's economy.]

With the finish line in sight, the battle has narrowed but the paths have diverged. Up until recently it seemed clear that Romney could not beat Obama on charisma and likeability, and Obama could not beat Romney on competence. But now Romney has done more to undermine the case for his election than anything Obama has done. Questionable campaign strategy and leadership, questionable teamwork, and questionable tax returns all raise doubts about the one thing Romney needs to win: a perception that he has the competence to be president. 

In sum, the strategy for the first debate on October 3 is clear. Somehow Romney needs to roll back the clock and return to emphasizing how he has the business acumen, turnaround experience, and analytical mindset that is needed to revive the economy. Obama needs to continue on offense, not letting anyone forget about Romney's managerial weaknesses, while at the same time reinforcing the very real connection he still has with voters who want him to succeed. We're at Hail Mary time for Romney, and he did it to himself.

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