Obama and the 2009 economy

Larry Bartels— one of my favorite political scientists (almost every thing he does, I find myself saying, “I wish I had thought of that”)– has a really interesting post at the Monkey Cage looking at data indicating that presidents seem (based on pretty compelling statistics) by the state of the economy in the year they were elected:

Income growth in the second year of a president’s term is negatively (albeit weakly) related to his party’s subsequent electoral fortunes, while income growth in the year of his inauguration has a strong—and statistically reliable—negative effect.

If true, this is very good news for Barack Obama, because the year of his inauguration, 2009, was one of the worst years on record for American income growth. According to data from the Bureau of Economic Analysis, real disposable income per capita (including wages, investment income, and government transfers, subtracting taxes, and adjusting for inflation) shrank by 3.2% in 2009—the largest decline, by far, in the past half-century. The statistical model implies that that income loss will translate into a gain of more than 7 percentage points in Obama’s expected vote margin in next year’s election…

While the psycho-logic by which voters punish incumbents for good inherited conditions (or reward them for bad inherited conditions) may be obscure, the statistical evidence suggests thatsome process connects temporally remote economic conditions with choices at the polls. This empirical pattern is an embarrassment to analysts—including me—who have argued that voters are overwhelmingly focused on the here and now…

Whatever evidentiary weight one assigns to the empirical analyses reported here, they do underline a fundamental issue in next year’s election. If President Obama is judged primarily on the state of the economy in 2012, the verdict of the electorate is very likely to be a negative one. But if voters, for whatever reason, take into account the disastrous economic conditions Obama inherited from his predecessor, then he is likely to prevail. And if past election outcomes are a reliable guide, voters may indeed temper their unhappiness with economic conditions in 2012 by recalling how much worse things were in 2009.

I especially like Bartels’ humility here, too.  Obama will certainly provide a very interesting test case of this statistical model of elections.  The Democrat in me certainly hopes its accurate.

About Steve Greene
Professor of Political Science at NC State http://faculty.chass.ncsu.edu/shgreene

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