Are the odds of President Obama being re-elected improving?
Yes.
Before we jump in, its important to remember there are almost eight months left until the November election. Anything can happen. What happens in Greece will certainly effect world markets and with the US economy on the mend itself, its not a good time to have to absorb another shock to the system. If recent reports are wrong that the Iranian leaders are prepared to have meaningful talks about its nuclear program, most experts agree that something will happen in that region. Iran may try to block the Straits of Hormutz, which will likely lead to a spike in oil prices and/or outright military intervention. Plus, the notion of Israel taking matters into its own hands could also have large repercussions. The Supreme Court will be hearing the challenge to the Affordable Care Act in late Spring and the resulting decision will likely produce aftershocks. If the ACA is upheld, then the Administration can take a bit of a victory lap. If its all ruled unconstitutional, then the GOP gets the victory lap. If only the individual mandate is ruled unconstitutional, but the rest of the ACA is upheld, then no one and both sides will take a lap.
Obviously, the Republicans are likely to have a say in the matter of another four years for President Obama. While its concerning to many Conservatives that the party hasn't fallen en masse behind a single candidate, at some point they will. In terms of sheer financial strength and organization, the nomination is Mitt Romney's to lose. His resources dwarf all of the other candidates combined. While he would do the best against Obama in the general, Romney isn't nearly conservative enough to suit many on the far right plank of the party, thus the battle continues until further notice. Rick Santorum is making progress every day into Romney's lead, but his stance on social issues turns off a lot of mainstream people. Newt Gingrich and Ron Paul seem to be doing a slow fade into irrelevance. Procedurally, its almost impossible for a new face to enter the fray at this point, like Marco Rubio or a Chris Christie, and both have said they're not interested in the Presidency at this time. With the long shot of a brokered convention leaving the door cracked open just slightly, a new face could ride into the fray on a white stallion to save the Republican day, but don't hold your breath.
The other caveat is Mr. Obama himself. Obama, during his time on the national stage, has committed any number of unforced errors, which the GOP will be watching for very closely. From the infamous picture of him at the Tom Harkin picnic for Democratic contenders back in 2007 where he failed to put his right hand over his heart during the playing of the national anthem, to insulting the Harvard police force during a live press conference which lead to the "beer summit," this President has often been his own worst enemy. A big part of successful messaging is controlling the news cycles and missteps like those two must be avoided.
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The economy is expected to be THE issue in the campaign. Pocketbook issues usually rule the day in national elections and while people don't like the deficit, don't like the size and scope of our Federal Government, etc., they'll tend to vote for issues closer to home. The people who feel strongly on issues like that already have their minds made up on who to vote for in 2012. Deficit hawks, Constitutionalists, Pro-lifers, anti-gay rights, pro-gun, etc. aren't likely voting for Obama no matter what happens. Period. Similiarly, the anti-war, black, jewish and latino voting blocks, the pro-gay rights, pro-choice, gun control, etc, crowds will vote for Obama no matter what. In both cases, even if they aren't totally pleased with how "their guy" stands on these issues, their votes are secured. What are they going to do? Vote for the other guy? Nope.
For most people, the economy is measured by how their situation is next September or so. Do I have a job? Can I pay my bills? Can I put gas in my car? Is my family ok? If the answers are yes...then traditionally most undecided voters award the incumbent with a second term. If they answer no, then they often chose to go a new direction.
Unemployment is heading in a good direction. The latest monthly figures show the unemployment rate falling to 8.3%, the lowest figure in the last two years...
(Click on the chart for a larger image...)
This morning, Bloomberg reports that monthly unemployment claims to the lowest mark in the last four years, which most economists interpret as a sign of a healing US labor market. “It’s clearly reflecting a rapidly improving labor market, signaling further declines in the jobless rate,” said Sal Guatieri, a senior economist at BMO Capital Markets in Toronto. “It’s good news for consumers, meaning stronger income growth and likely rising confidence that will support spending.” Wholesale prices and housing starts also reported a better than expected report. Its worth noting that some of these employment numbers are showing improvement due to a smaller labor pool of people actually looking for work. As 2012 unfolds, its expected many of these unemployed people who gave up looking for work will take another run at finding a job, therefor enlarging the labor pool, which may stall or even see the overall unemployment rate backslide at times. In other words, the slope of job growth won't be purely upwards, it will more likely be a sawtooth type pattern over time.
We also see an uptick in business confidence:
But work needs to be done on consumer confidence:
Meanwhile, the stock market is doing very well as people's retirement plans slowly recoup some of their lost earnings:
Americans don't care too much for the nitty gritty on unemployment statistics. If the overall rate keeps dropping, and they see the stock market doing well, I say those are two big factors that average voter can feel pretty good about. I think most people understand that the economy and unemployment can't be fixed overnight (or in 3-4 years) and will reward Obama for this progress.
Gas Prices will also be a big factor as it effects almost everyone of voting age. Let's see how historically gas prices today compare with the last five years worth of data:
Things aren't expected to be very pretty around Memorial Day this year either. Combine the effect of Iran restricting its oil supply to the world supply as a response to increased sanctions by the US and other countries, plus the increased demand nationally due to the improving economy, don't be shocked if we see prices per gallon in excess of $4.00.
An ABC News report on the gasoline price situation:
What President Obama probably hopes for is that if there is a peak in gas prices around May 30, that it then is in a clear state of decline by election day in the Fall. I expect to hear the Right push the argument if Obama had done more to reduce our dependence on foreign oil, we wouldn't be in this position. Which is a bit of a dishonest argument. New wells drilled in early '08 wouldn't necessarily be providing product to the consumer market, so who knows? Bottom line, I think this is a weak spot for Obama but probably not a fatal one. He'll likely be able to put much of the blame on the Iranians if they shut off their supply or close the Strait of Homutz. That will be the main story, over-shadowing even domestic gas prices.
To say Barack Obama is a polarizing figure in US politics is an understatement. Accused of various crimes and misdemeanors including being un-American, a Socialist, a Marxist, a Muslim, anti-life, anti-business, anti-jew, anti-everything that is good and American. There is a percentage of Conservatives who have a visceral hate of this man. They will not vote for him under any circumstance. They are likely offset by those who are so pro-Obama they will vote for him no matter what. Which brings us to the all important undecided middle ground. How they vote will decide the 2012 presidential election.
After his early popularity numbers cratered, we've seen a steady increase in job approval numbers since last Summer. According to the Gallup job approval tracking, Obama's has seen his performance rise from a low of 39% in August to a high of 49% as of February 8th. If the unemployment rate continues to drop, look for his numbers to stay pretty flat around the 50% approval mark.
Looking at the Real Clear Politics comparison of Obama vs. the four remaining Republican candidates, we see the following: (Real Clear Politics combines a variety of national polls to reflect the data on a broader level...)
Obama vs. Romney: Obama + 5.9
Obama vs. Santorum: Obama +8.0
Obama vs. Gingrich: Obama +13.2
Obama vs. Paul: Obama +9.6
Remember this is a snapshot, not a prediction of future results. However, none of the Republican candidates are in a position of strength at this time. Which has to be a concern to those who wish to see Obama replaced next Fall.
Additionally, a Fox News Swing State poll released late yesterday indicates support for President Obama is improving, while support for the GOP alternatives are not, in most cases. The states looked at include Colorado, Florida, Iowa, Nevada, Ohio, New mexico, North Carolina, Pennsylvania, Virginia and Wisconsin...
See the very interesting and surprising results here... Fox News Poll
As I wrote earlier today, the New York Times Nate Silver, suggests that President Obama will defeat any of the four current GOP candidates...
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There are 264 days until Election Day. The Republicans will choose a candidate at some point and rally behind him. There will be two debates between President Obama and the GOP candidate, which could help/hurt either candidate. As mentioned earlier, outside events could influence the election. All of that aside, based on what we know today, it looks like President Obama has a very serious chance to be re-elected. Which is surprising to me given the amount vitriol and criticism associated with this President. There have been times when the passion from the far Right has seemed quite loud to say the least. However, as we move towards the main section of the campaign, it appears that both the volume and the influence of the louder voices on the far right are not as effective as they seemed for the mid term elections in 2010. Obama is seemingly beginning to peak at just about the right time.
Sources:
http://www.bloomberg.com/news/2012-02-16/jobless-claims-in-u-s-fall-to-four-year-low-correct-.html
http://abcnews.go.com/blogs/business/2012/01/forecast-2012-worst-year-for-gas-prices/
http://www.gallup.com/poll/113980/gallup-daily-obama-job-approval.aspx
http://www.realclearpolitics.com/
http://www.foxnews.com/interactive/politics/2012/02/15/fox-news-swing-state-poll-is-landscape-shifting/
http://www.nytimes.com/2012/02/19/magazine/nate-silver-obama-reelection-chances.html?_r=2&hp
http://www.opec.org/opec_web/en/press_room/179.htm
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