Making Financial Decisions With a View to Future Public Office "From the appointment standpoint, it is getting harder and harder to get competent men and women to serve at the highest level because of the financial disclosure act and other disclosures," said E. Pendleton James, who was the head of the Office of Presidential Personnel for Ronald Reagan. IF one thing is clear this campaign season, it is that both Republicans and Democrats have made financial decisions that are perfectly legal but nonetheless look bad. Mitt Romney's release of his tax returns raised numerous questions about his finances, the latest involving an offshore account that holds some of his retirement money from Bain Capital. And Nancy Pelosi, the Democratic former House speaker, came under scrutiny after a "60 Minutes" report that her husband bought shares in the Visa initial public offering in 2008 as credit card legislation was pending in the House. In the negotiations this week on legislation barring members of Congress from trading on information gleaned from their work, House Republicans proposed the "Pelosi provision" to limit members of Congress from buying into I.P.O."s. Since most people do not make their career plans with an eye toward a future run at political office or an appointment to a cabinet position, past business, financial or tax decisions that made sense to them at the time can come back to haunt them. "What may have been acceptable business practices or relatively unknown business practices 10, 15 years ago are liable to cause problems today," said Craig Varoga, a Democratic consultant who runs the Patriot Majority political action committee. The current economic situation, he said, with so many people still unemployed or struggling to make ends meet, has also played a role in the changing perspective. So what should businesspeople be thinking about now to avoid problems later? Taxes, for one. That has always been the biggest problem for any candidate or nominee for a post that needs Senate confirmation. In 1993, President Bill Clinton's first nominee for attorney general, Zoë Baird, withdrew her name from consideration because she had employed illegal immigrants and failed to pay the required taxes. Today, most hopefuls would not get so far with such an obvious tax problem. But subtler, often legal, tax issues can also cause problems. Take the case of the 2010 Illinois gubernatorial race in which a Republican state senator, Bill Brady, sought to unseat Pat Quinn, the Democratic incumbent governor. Mr. Brady had used his losses from his real estate business to offset the tax on his state salary, something that was legal and that most accountants would advise business owners to do. But the Quinn campaign played up the issue when it realized Mr. Brady's action resonated with voters. "Good business is not always good politics," said Ben Nuckels, who ran Mr. Quinn's successful campaign. Just because something is legal doesn't mean voters believe it to be an acceptable practice. The same goes for investment portfolios. One rule of thumb is that the more complicated they are, the more explaining you will have to do. Mr. Romney can attest to that. Many times it is the perception of someone's lifestyle more than anything else that hurts business people. Analysts said that while a successful executive may pay $500 a week to maintain his lawn and think nothing of it, that might not play well among people who do not earn that much in a week. How a candidate explains this situation is crucial. In the 2004 presidential campaign, both candidates, George W. Bush and John F. Kerry, were fabulously wealthy. Mr. Bush inherited his money and Mr. Kerry married into it, yet the Bush campaign managed to paint Mr. Kerry as out of touch and Mr. Bush as an average guy. "It played to a narrative that, in the case of John Kerry, was possibly one of flip-flopping and being aloof, if you will," said David L. Mercer, president of Mercer & Associates, a political advisory firm, and a member of the Kerry/Edwards 2004 Presidential Campaign Leadership Council. That is the problem that in some respects Mitt Romney is facing when, on stage, he casually lays down a bet of $10,000 to Rick Perry when some people are trying to earn that amount in six months. A tougher hurdle for most business people would be passing the Senate confirmation hearings for a cabinet-level position.