If the nut is loose so the arm can spin on the shaft, and you cannot spin the shaft in either direction, then something is jammed. Keep in mind that the engine ALWAYS tries to run at full throttle with the butterfly wide open. The job of the governor is to not allow that, and pull it back to a reasonable speed. To adjust it, the throttle is held full open, and the governor pulled back to its stop. Then it can move in the direction that closes the throttle a little when it is running. On mine, the movement of the governor might have been 1/4". Not a lot. I think a 1/16" socket fits on top of the governor shaft which makes it easy to turn and hold it in position while the arm is tightened. Whatever way the governor pulls the throttle to slow it, you want the shaft to rotate the opposite direction to its stop. That way it has maximum movement to close the throttle. If you do it backwards, then it has no way to turn to close the throttle.