That at least was the version of the comments that appeared in The Sydney Morning Herald. A similar version, but without the full quotes, appeared in the AP.
Quoting Romney: ''And this idea of America in decline, it was interesting [Carr] said that, he led the talk of America being in decline. See that's not talk we hear about here as much as they're hearing there. And if they're thinking about investing in America, entrepreneurs putting their future in America, if they think America's in decline they're not gonna do it."
Whether or not the SMH got it right is one question. The Hill notes that the pool reports did not have Romney clearly characterizing the comments as a warning.
And now, Australia's Foreign Minister's office has come forward to shoot down Romney's characterization of the discussion, calling Romney's interpretation "not correct."
You cannot take a shoot down like this at face value in any case. Whatever Carr said, he almost certainly didn't expect Romney to turn around and use it as ammo in a political speech. Allies don't want to get publicly embroiled in a US election -- especially on the wrong side of an incumbent who they believe is more likely than not to get reelected. So he'd be under a lot of pressure to walk away from Romney's comments, even if Romney was accurately characterizing them. On the other hand, maybe Mitt just made it up or gave it -- probably the most likely option -- a negative spin the retelling. One way or another, it will be interesting to see how Romney navigates this sort of stuff when he's overseas.