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Why Wall Street Loves Mitt Romney: Q&A With THL Partners' Scott Sperling

TheStreet: You are a numbers guy, how you reconcile Romney's budget?

Sperling: I think there are certain assumptions [candidate Romney] makes about the ability of his actions to stimulate economic growth and that is one of the key assumptions he utilizes in order for him to get to the numbers that he is projecting. If you look at what Ronald Reagan did in the 1980s, he inherited a worse economic situation where the misery index was higher than it was even in 2009. The actions Mitt is talking about are the same ones that led to 8% GDP growth [under Reagan].

With Bill Clinton, the growth came when he cut capital gains taxes, when he started to reach across the aisle on things like 'Welfare to Work,' and when he and his cabinet worked on various deregulations that actually allowed companies to have lower costs and achieve higher rates of growth. That prescription led to the growth rates, in fact higher growth rates than are assumed in Mitt's budget.

If all we look at are tax cuts and the fact that Mitt has promised not to increase taxes on the middle class, the assumption that some [skeptics] are making is that I'm going to have to increase taxes by $2,000, which Mitt is just not going to do. Then they say, 'well if you don't do that then how do you achieve the budget deficit objectives you say you are going to achieve?' The way you get there is through economic growth. But that's easy to pick on.

TheStreet: How does Mitt Romney's experience running Bain Capital support his economic agenda?

Sperling: The thing that Mitt has done well is really identify ways to drive growth and work in highly complicated, often troubled situations and really turn these companies around, instead of being stuck in a problem. The result is you end up being in a higher growth situation. In the case of private equity, it meant very strong rates of return for Bain and its investors. He took that same skill set and applied it to the Salt Lake City Olympics and turned it into a great success.

TheStreet: Mitt Romney's recently been plagued by public relations 'gaffes,' what's your take?

Sperling:The fact is that Mitt is not a lifetime politician, which means he is not going to be glib in the way that the press might like a politician's glib. So what [the press] thinks of as a gaffe is not so much a gaffe as it is [Mitt Romney] stating the truth. Look, Mitt did not articulate the hard truths probably as well as he would like, as he said... the fact is he was really talking about why you have so many people dependent on the government and we just can't have that because those people don't want to be dependent on the government. It's not the way Americans want their lives to go and we have to return to a set of policies that will allow for the kind of growth that will put people back to work.

For on private equity investments, see Scott Sperling speak about how THL Partners, Bain Capital and The Carlyle Group helped to drive a top and bottom line earnings recovery at Dunkin' Brands (DNKN - Get Report), the parent of Dunkin' Donuts.

For more on private equity, see why Goldman Sachs is cutting its private equity future by half. Also see why a dividend is key to Carlyle Group's stock strength.

-- Written by Antoine Gara in New York
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