The Economy and the 2012 Election: How Obama Could Win (or Lose)...

Fifteen months out from the 2012 presidential election, how are things looking for Obama? Not great. "It's going to be a very close, competitive election … a street fight for the presidency," White House aide and 2008 campaign manager David Plouffe told reporters yesterday. No kidding. Obama's approval rating is below 50 percent. Unemployment, currently at 9.1 percent, might be down to 8 a year from now; no incumbent since FDR has been reelected with the jobless number above 7.2 percent. GDP grew by a pathetic 1.9 percent last quarter. Granted, Obama could argue the economy would be in even worse shape absent his stimulus program – but good luck running on that argument.

Even so, reports Doyle McManus in the LA Times, Plouffe still says the election is Obama's to lose.  His reasons: he thinks the president has a good shot with independent voters, who'll reward his bipartisan, bend-over-backwards approach the debt talks; he's a seasoned campaigner with a huge war chest; he's moved to the center without losing the base (the oft-noted "enthusiasm gap" seems to have closed); demographics are on his side (he won big with minorities in 08, and they'll make up a larger share of the electorate next year); and, of course, the GOP field is weak: Frontrunner Mitt Romney is the most formidable of the bunch, but he's nobody's idea of a standard bearer.

But does any of this matter, given the economic picture? Well, yes – and partly because the economic picture, and its likely effect on the election, is less cut-and-dried than it looks. As political scientist Larry Sabato explains here, unemployment isn't a perfect predictor Sure, no president since FDR has been reelected with joblessness above 7.2 percent, but FDR was reelected, twice, with unemployment at 17 and 15 percent, respectively! These are old numbers, for sure, but they at least suggest it's "the trend of unemployment that makes the difference," writes Sabato. (In both cases, the number was coming down.) More evidence for that: Reagan was reelected with unemployment at 7.2 percent, down from 10 and change; George H.W. Bush was booted with unemployment around 7, up from around 5 when he was elected.

As for economic growth, there's no iron rule here, either. The key time period to watch is the third quarter of the election year, from July 1 to September 30. As with unemployment, the big question is: what's the trend?  Bill Clinton had a lower economic growth rate for his 1996 reelection (4.8 percent) than Bush did when he lost in '92 (6.1). The difference: people felt the economy was was on the up in one case but not in the other. (Oh, and GDP growth can't trump other factors. Guess what the figure was when Jimmy Carter ran for reelection in 1980? A whopping 8.6 percent! He lost, of course.)
All of which goes to show, you can't write off Obama just because the economy sucks right now. On the other hand, if unemployment isn't coming down perceptibly by mid-2012, and the economy isn't growing fast enough, then Obama is pretty much toast, whatever his other advantages. But it's a long road from here to there.

Courtesy of rollingstone.com