Mitt Romney was sworn in as the 70th Governor of Massachusetts on January 2, 2003, along with Lieutenant Governor Kerry Healey. Romney's term ended on January 4, 2007; he chose not to run for re-election.
Inauguration
Romney's swearing in as governor used the same Bible that his father George Romney had used when he was sworn in as the Governor of Michigan. In his 15-minute inauguration speech in the Massachusetts House of Representatives, he avoided policy specifics, but said that he intended to bring about a "lighter, more agile bureaucracy." The overall inauguration festivities took place over three days and emphasized themes around common citizens.
Upon taking office, Romney faced a state legislature in which Democrats held 85 percent of the seats. Indeed, the state Republican Party had fielded no candidate for 62 percent of the seats during the 2002 state elections.
From the outset Romney sought to show himself as the state's first 'CEO governor'. His choices for the executive cabinet included well-known figures such as Democrat Robert Pozen, former vice chairman of Fidelity Investments, and Douglas Foy, who had served as president of the Conservation Law Foundation. They and other cabinet members and advisors were picked more on managerial abilities rather than on party affiliation. Romney gave them broad authority over new what he called "super-secretariats".
Romney and Healey both pledged to forgo their official salaries for the length of their terms.
Fiscal policy
Background
During the campaign for the governorship in 2002, Romney proposed a plan that he said would balance the Massachusetts budget without raising taxes. He campaigned that he would be able to save $1 billion (out of a $23 billion budget) by reducing waste, fraud, and mismanagement in the state government, and he railed against the large tax increase that the legislature were negotiating in an attempt to close a looming $2 billion budget deficit. He promised that if elected he would repeal that tax increase within four years without cutting core government services. Surveys suggested that many residents agreed with his antitax stance. Though less than a majority, some 40 percent of the voters voted in favor of abolishing the income tax in a referendum held during the election that carried Romney into office; and in an April 2003 poll of Massachusetts residents, 57 percent said Romney should not consider raising taxes as part of his plan to balance the budget.
Upon entering office, Romney found that the emergency spending cuts and tax increase that the legislature had enacted under his predecessor, Jane Swift, months earlier had proven insufficient. He faced an immediate budget shortfall for the current fiscal year estimated to be between $450 million and $650 million, and a deficit for the following year initially projected to be $3 billion, although outside analysts and the state Department of Revenue said that that projection was too high, as it was based, they said, on faulty revenue predictions.
Emergency budget cuts
Massachusetts law required that all state budgets be balanced, and the current fiscal year was already more than halfway over when Romney assumed office (Massachusetts' fiscal year begins July 1 of the preceding calendar year). To close the deficit, he asked for, and was granted by the state legislature, emergency powers (under the existing Section "9C" authority in state law) to make unilateral cuts in the fiscal year 2003 budget.
Romney's initial emergency budget proposal for the fiscal year 2003 called for $343 million in immediate funding cuts, necessitating layoffs of state employees and cuts in aid to cities and towns for public safety and education. He explained in a televised address, "There's no time to restructure state government or remake state programs. On such an emergency timetable, there's just time for cuts." He also proposed cuts in state expenditures for Medicaid, the government program providing health care for the poorest state residents. The cuts included caps in payments to medical providers (one example being through limiting payments for hospital stays to 20 days, no matter how sick the patient), increased stringency of the criteria for Medicaid eligibility, and rationing of access to higher-priced medications for Medicaid patients. Some 36,000 Massachusetts residents lost their Medicaid eligibility. The 2003 emergency budget revision proposal also included funding cuts affecting public colleges and universities, treatment for schizophrenic and other mentally ill patients, and various other social services.