Vice President Jim Hobart was recognized as one of Campaign and Election Magazine’s 2013 Rising Stars. Congratulations, Jim!…
Obamanomics: America really ISN’T GROWING (that much)
Economic growth is like gravity for campaigns: poor Gross Domestic Product (GDP) growth sinks an incumbent while strong growth is a boon.
Check out http://www.data360.org/dsg.aspx?Data_Set_Group_Id=274 for a ton of historical data.
We’re talking about “real” GDP growth, not “nominal” GDP growth. Real GDP growth is an apples-to-apples comparison that factors out inflation. Example: the Obamanomics crowd is all giddy over the 3.85% nominal growth measured in the second half of last year. In reality, the real growth rate was 1.55% (less than half of the nominal rate).
The rest of what Obama is taking credit for was inflation – the ever shrinking value of your money. This isn’t the only time we see undue credit being given. See how the unemployment rate has gone down while even more people don’t have jobs. (President Obama: “America is back!” Guess again: More than 40% of Americans aren’t working.)
Looking at the 3rd and 4th quarters of presidential election years going back to ‘48, you see a clear impact: When a party kept control of the White House, real growth averaged 4.45%. When it lost control, the average was 2.40% .
That amounts to a 46% difference in real GDP growth between winning and losing an election.
Again, during the last half of 2011, the REAL growth in GDP was a paltry 1.55%, firmly in the realm of the “losers.” It also puts the President almost three points shy of the average winner in terms of real GDP. Not good for Obama.
Several examples from the winners circle:
– Clinton crushes Dole in ‘96 (4.2% 2nd half growth)
– Reagan wipes out Mondale in ‘84 (6.25%)
– LBJ drubs Goldwater in ‘64 (5.9%)
Along with a couple of losers:
– Nixon didn’t win the White House after Ike in ‘60 (1.18%)
– Reagan beat Carter in ‘80 (-0.85%)
– Obama beats McCain after eight years of “W” in ‘08 (-1.95%)
Seems like some elections have generated some urban myths: were the winners THAT good? The losers THAT bad? Or, were the election results just a reflection of our economic times?
Sometimes even poor 2nd half growth can’t sink a decent candidate or boost a lame challenger. Bush 43 was a full one-and-a-half points under the average winner and still won. Eisenhower demolished Stevenson in ‘56 with economic growth at 1.3% – the worst measured for a successful presidential re-election. Eisenhower won 41 out of 48 states and 57% of the vote; was he that good or was Stevenson that terrible?
Absent a record economic turnaround, lackluster growth leaves the President in dire need of a harsh attack machine; he needs Americans to prefer joblessness over a Republican’s presidency.
Even that won’t be enough. Obama will make use of his vast campaign wealth, trying to destroy the GOP nominee and overcome the worst economic growth an incumbent president has faced since Jimmy Carter.