Americas Independent Movement

‘Are You Better Off Than You Were Four Years Ago?’

By GERALD F. SEIB
President Barack Obama, who made history in 2008 by becoming the first African-American elected president, would like to notch another historic achievement next year.

He will try to win re-election while likely saddled with a higher unemployment rate than any other president seeking a second term in 76 years.

Mr. Obama undoubtedly would prefer to forgo that distinction, but there is no escaping the harsh economic backdrop that will mark the campaign of 2012. The economic malaise sets the stage for a presidential contest that analysts in both parties expect to be very close, and a much tougher haul for the president than his election in 2008, when he became the first Democrat in 32 years to win a majority of the national vote.

The election season is about to start with a rush, though it is likely to turn into a long slog through the year. The Iowa caucuses, which will start the process of picking a Republican challenger to the president, are held in nine days (Jan. 3), to be followed by the New Hampshire primary a week later and the South Carolina and Florida primaries by the end of January. But, because so many Republican delegates will be chosen slowly under this year’s calendar, the fight for the GOP nomination could easily stretch through the spring.

Most presidential elections turn on the economy, but that figures to be especially true this time. Recent weeks have brought a few, tentative signs that the nation’s bleak jobs picture may be improving, which would certainly help the president. Still, the unemployment rate stands at an unhealthy 8.6%, and few analysts think it will drop fast enough to reach the 7.4% rate that prevailed when Ronald Reagan won re-election in 1984, or even the 7.5% when Jimmy Carter lost his re-election bid in 1980. Not since Franklin Roosevelt won re-election in 1936 has a president faced a worse jobless situation.

More broadly, Mr. Reagan set the modern standard for gauging the economic mood of voters in an election year in that 1980 race, when he unseated Mr. Carter in large measure by asking voters simply: “Are you better off than you were four years ago?”

If the coming election is determined by that maxim, or by most traditional measures, President Obama would seem to face bleak prospects. Consider just a few snapshots of leading economic and political indicators:

Unemployment, the economic statistic that packs the most political punch, has risen to 8.6% now from 7.8% the month Mr. Obama took office. It topped 10% briefly in 2009.

The misery index—the combination of the unemployment and inflation rates—has risen to about 12 now from 7.83 when he took office.

Median family income fell in the first two years of the Obama term, after rising the previous four years.

As of September, 12.6% of U.S. mortgage borrowers had missed at least one payment on their mortgage or were in foreclosure, down from a peak of about 15% but still well above the normal range of 5% to 7% in the last two decades, according to data from the Mortgage Bankers Association.

In large measure because of a decline in home values, household net worth dropped 1.7% over the last year; under every president since 1948, it rose in the year preceding the election.

Mr. Obama’s job approval stands at 46% in the latest Wall Street Journal/NBC News poll, below the levels George W. Bush, Bill Clinton and Ronald Reagan had a year before they were re-elected, and below where George H.W. Bush stood a year before he lost his re-election bid.

Approval of Mr. Obama’s handling of the economy is even lower; it stands at 39%.

The upshot: By most normal standards for gauging a president’s chances of re-election, Mr. Obama would appear sunk.

But “this isn’t an ordinary year,” argues David Axelrod, Mr. Obama’s chief political adviser. And it’s just possible that the normal political metrics don’t hold in a time of unusual economic and political ferment. Indeed, Mr. Obama holds some advantages that are obscured by the overall economic gloom.

For starters, after more than three years in office, he still isn’t shouldering most of the blame for the economic slump. When the Journal/NBC News poll last month asked Americans who they think is most to blame for current economic problems, both former President Bush and Wall Street bankers were fingered more often than was President Obama.

That attitude gives some resonance to Mr. Obama’s argument—already oft-stated and sure to be repeated a lot in the campaign to come—that the Republican administration of George W. Bush allowed the country to fall into a deep economic ditch, and that it isn’t Mr. Obama’s fault it’s taking a long time to climb out.

Second, whatever unhappiness exists with Mr. Obama’s economic record, there is ample reason to think Republicans are even less popular. Just over 40% of Americans have an unfavorable view of the president, but 48% hold an unfavorable view of Republicans. And when Americans are asked which party is better at dealing with the economy, the two parties are rated about evenly.

“That Republicans are still not seen as a truly acceptable alternative at the moment gets at the anger and the frustration the public has at Washington, that nobody is doing anything right,” says Jay Campbell, a Democratic pollster who works for Peter Hart Research. Hart Research helps conduct the Wall Street Journal/NBC News poll, along with Republican firm Public Opinion Strategies.

The gridlock that has taken hold in Congress since Republicans won control of the House last year doesn’t appear to be helping the GOP either. A record 42% of Americans call the current Congress one of the worst ever, and they rate Republicans’ performance in it slightly below that of the Democrats.

Moreover, none of the Republicans jockeying for the right to run against Mr. Obama next year is exactly soaring in public esteem. Former House Speaker Newt Gingrich, now one of the two front-runners for the GOP nomination, is popular among his party’s conservatives, but gets low ratings among the kinds of independent swing voters who tend to decide national elections. His main opponent, former Massachusetts Gov. Mitt Romney, does better among independent voters but isn’t particularly popular among his own party’s conservatives.

Taken together, all these forces suggest that a close election lies ahead. Bill McInturff, a Republican pollster who heads Public Opinion Strategies, says there is a “core coalition of voters” who already have decided that they won’t vote for Mr. Obama again, including Southerners and traditionally Democratic blue-collar workers. On the other hand, he notes, his own party’s candidates “are not in particularly good shape in terms of overall standing with the country.”

If that sounds like a formula for a tight finish after a campaign that isn’t particularly uplifting—well, that’s precisely the kind of forecast most political pros are offering.