12.12.11

Mitt Romney's $10K Gamble Was Worth It, and About Right for His Wealth

Perry and other critics are beating up on Romney for proposing a bet that’s ‘out of touch’ with ordinary Joes, but the amount is appropriate for the ex-governor’s wealth—and making the wager shows he’s not an ultraconservative puritan.

For those who didn’t watch the Dec. 10 Republican debate, the most memorable moment was when Mitt Romney challenged Rick Perry to a $10,000 bet over something Romney allegedly wrote in the first edition of his book No Apology. After the debate, Perry said the amount proposed was “a little out of touch with the normal Iowa citizen.” To that, I say “So?”

Nobody disputes that Mitt Romney is a wealthy man. The question is, did the challenge make him come off as an insensitive rich snob? If so, how much should he have suggested? It is worth noting that Perry isn’t poor either, reporting a net worth of $2.8 million earlier this year.

As a gambler, I applaud Romney for suggesting the bet. When two people simply can’t agree about something, a wager is the usual way to settle it. For example, recently a friend of mine predicted that Miley Cyrus would be pregnant, in jail, or in rehab by the age of 21. I disagreed, so we bet $250 on it, which for us was big enough to make it interesting, yet small enough to keep it friendly.

Given that Romney was going to propose a bet, what should the amount have been? The pundits have been beating up on him ever since, mentioning that $10,000 is two to three months’ income for the average American family. The implication is that it shows Romney is out of touch with the common man.

If anything, $10,000 is too small a bet for Romney. Perhaps he kept it relatively small because Perry is not as wealthy as he is.

It is no secret that Romney is wealthy. If he had proposed betting $20, then everybody would have called him a phony, trying to look like an average Joe, which he’s not. His wealth is in the range of $190 million to $250 million. Median U.S. household wealth is about $100,000. So $10,000 to Romney would be like $5 to the average American household.

If anything, $10,000 is too small a bet for Romney. Perhaps he kept it relatively small because Perry is not as wealthy as he is. To Perry, $10,000 would be like $350 to the average American household.

My opinion is that $10,000 was an appropriate bet, given the two men’s wealth. Should Romney have suggested something smaller to avoid insulting the audience? Hell, no! If that is the case, then I think we’re all a little too sensitive. Wake up; this is not a classless society. Keep in mind that this was a debate in front of an audience of Republicans, who are supposed to not begrudge the rich their wealth.

Let me be the first to say that the bet was a good idea to settle the issue about Romney’s book, and the amount was honest and appropriate. Furthermore, it may have helped dispel any notion that he is an ultraconservative religious puritan, opposed to gambling on principle. Romney may have lost points with the rest of the voting public, but he won some from me, at the expense of Perry, who came off looking like a coward for refusing the bet.