Set the governor arm according to the manual. With the bolt loose, move the arm away from the carb to hold the carb butterfly wide open, grab the rod with pliers and turn counter clockwise until it stops, tighten bolt to hold the arm on the rod in that position.
When you start the engine and have it running, manually open the carb butterfly with your hand and you should feel the governor arm pushing back to try and close it.
The throttle cable connection to the governor arm must use a spring and not be a direct connection. It's the spring which allows the governor to move and therefore control the carb.