Pethokoukis, Politics and Public Opinion

Where’s the landslide? Why 2012 isn’t 1980

Image credit: JPMorgan

Image credit: JPMorgan

Republican National Convention – Tampa, Florida

Just a few more bits of data among many, but today’s consumer confidence numbers were dreadful.

JPMorgan:

The Conference Board’s consumer confidence index fell 4.8 points to 60.6 in August. Since peaking at 71.6 in February, the index has dropped 11.0 points to its weakest reading since November 2011. The weakness in the Conference Board index in August contrasted with the modest improvement already reported in the preliminary University of Michigan consumer sentiment index for the month, but the deterioration in consumer attitudes looks reasonable considering the recent increases in jobless claims and gasoline prices.

IHS Global Insight:

Consumer confidence is digging deeper into recession territory, making it perfectly clear that there is a high degree of pessimism on job prospects and the overall economic outlook. Adding fuel to the fire is raising pump prices.

 All is not well on the consumer front and retailers are feeling the pain. Americans are spending less money and time shopping. Consumer spending trends have had noticeable fits and starts that are not indicative of a robust, healthy, and confident American consumer.

 This is a bad report. Last month, consumer confidence increased for the first time in five months. Currently, consumer confidence is at a ten month low. Last summer, consumer confidence plunged by 27% due to the debt ceiling debacle. There had been considerable gains in confidence in the latter part of last year and the beginning of this year. However, consumer confidence fell by only 6% this summer – so, the good news in this report, is that the summer blues have not been as bruising.

 Looking ahead, consumer confidence is likely to remain in recession territory, unless there is a dramatic shift in payrolls and wages.

Of course, why wouldn’t consumer confidence be in the dumps given high-but-stagnant unemployment and below-trend GDP growth? Some 70% of Americans think the country is headed in the wrong direction.

Given all that, many right-of-center folks wonder why President Obama isn’t headed for a defeat as bad as Jimmy Carter’s 10 percentage point beating by Ronald Reagan in 1980.

Yet the polls show Obama and Mitt Romney in a tight race. At a forum earlier today, pollsters Kellyanne Conway and Whit Ayers offered four reasons why 2012 isn’t looking like 1980:

1. Jimmy Carter won a close 50.1%-48% race to become president. Obama won by a near landslide, 52.9%-45.7%. Ayers says the bad economy has pretty much wiped out that 7-point lead, but given such a huge head start, Obama went into his reelection campaign with a much deeper reservoir of goodwill than Carter had.

2. Obama has a much more favorable demographic situation than Carter did. Ayers said that if Romney were running with an electorate that looked like Reagan’s in 1980, he would be winning by a landslide. In 1980, 88% of voters were white; today 74%.

3. Conway agreed that a variety of economic woes makes it look like “a perfect storm” in Romney’s favor. But the long duration of economic weakness and the uncertainty that has come along with it may have made voters shy about adding to the uncertainty by electing a new president. This is why it is critical for Romney to present a clear, confident, competent, and comforting vision of what a Romney presidency would be like.

4. Conway says the Long Recession might also have made voters so pessimistic that they no longer believe the economy can be righted in just four years. Thus, they believe, Obama deserves more time to right the ship.

I would also add that a) there was an outright recession in 1980 — not just a lousy recovery; b) the unemployment rate surged from 6.3% in January 1980 to 7.5% in October; and c) the Misery Index (unemployment + inflation) was just over 20 in 1980 vs. just under 10 today.

It is hard for Obama to argue the U.S. economy has turned a corner. For Carter, it was impossible.

33 thoughts on “Where’s the landslide? Why 2012 isn’t 1980

  1. What recovery? Money is cheap for banks and companies have no reason to hire new employees. Unemployment number is not even close to reality. Local and state government are running on empty.

    Obama was elected because Americans wanted a new leader. McCain was Bob Dole Part II who did not believe anything he said to the voters.

    Its a depression and never was a recession.

  2. re: the Misery Index
    You keep talking about how low inflation is, and now you cite a Misery Index that is “under 10.” I don’t know where you buy your groceries, or whether you’re a vegetarian, but we’ve seen an explosion in food prices which shows no sign of abating (meat, e.g., has DOUBLED, fish is worse), gas prices are about 10 – 15% higher, and maintenance expenses here in true-Blue Northern New Jersey are all much higher. Maybe consumer electronics are down, but I don’t know anyone who can eat computers, use them to keep warm, or protect themselves from the rain with them. I think the people who keep the inflation statistics are manipulating the numbers to make things look less bad than they are. As for unemployment: work-force participation is way down, and youth unemployment is stratospheric, all of which make the broader measure, U6, that much more significant. The last time I looked, it was around 15%. Moreover, at least one former head of the NBLS has maintained publicly that if the data were tracked as they were in the 1980s, the current numbers would all be in the high teens. This sounds like a misery index much closer to 20 than to 10.

    • Great observation. Two more qualifiers for the Misery Index…1) Inflation (including interest rates). The inflation rate was “modified” several years ago to exclude food and energy, because increases in those items didn’t produce a warm, fuzzy, comfortable inflation rate (similar to the WH/Admin changing the unemployment formula in Jan this year to keep the rate artificially low). 2) The Federal Reserve and US Treasury have kept interest rates low on purpose…NOT to help consumers or the economy, but guess who is the biggest borrower and needs low interest rates? That’s right, the government. So low interest rates aren’t for home mortgages, but that the government can pay the lowest interest possible on their domestic debt. It is simply amazing that our media is so complicit and our populace is so ignorant of facts.

    • I can remember when gasoline could be puchased, “in true-Blue Northern New Jersey,” for 15 cents/gal. A couple years later I got my license and got some gas for 17 cents.

    • Correct – the inflation rate that is typically cited by the MSM is the “core” inflation rate. It excluded food and energy costs (because they are volatile from month to month) and they encompass a concept known as owner’s equivalent rent, which is essentially the cost of housing (also obviously subdued these days with housin prices in the tank). Thus inflation is drastically biased downward for the purposes of a truthful misery index.

  3. At this point in the campaign, Carter was 9 points ahead of Reagan. Reagan did not pull ahead until the last week.
    Both the mathematical model you showed and the one recently published by professors at the Univ. of Colorado show a decisive win (not a landslide) by Romney–just like 1980.
    Can’t you find any positive thinkers down there?
    Adjust your expectations.

    • You’re right. In fact, I recall going into the last weekend in 1980, most polls showed them tied and rated the election a tossup. When Carter was blown out the following Tuesday, the media “experts” were bascially sitting there with their mouths agape wondering what had happened.

  4. In the run-up to the 1980 election the news programs night after night were talking about how Carter was wimp because he was getting nowhere with the Iranian hostage crisis. That made most swing voters feel that voting for Reagan was voting against Iran. Reagan scared the Iranians — witness how they gave up the hostages within hours of Reagan becoming president. You can search the web all you want for economic statistics in 1980 versus today, but there is no way the web can tell you the difference between relevant and irrelevant data about the past. If you actually went back in time to 1980 you would quickly realize that the economy was always playing second fiddle — a distant second fiddle — to the Iranian hostage crisis in determining who won that election.

    • It was worse.Double digit inflation and interest rates.Economy in recession.We are not in a recession,only that it is slow growth.Carter lost because he failed in the debates.Reagan pummelled him.Romney will not be able to do this to Obama.Obama has an argument for a slow economy.He did save this country from the brink.Remember the greedy CEOs coming to Washington on their 2 million dollar jets with hand held out because they ran the businesses into the ground that had no regulations??Short Memories.If Obama explains where we were and where we are in an honest sincere tone,He will win.Remember,his likeability ratings are 62% to 28% for Romney.

  5. the polls were irrelevant then. like now, the major polling outfits survey “Adults” and tend to overweigh dems. in the last week, the pollsters tend to do it right so as to not look foolish. every cycle they talk about the last week things changed because voters got ” focused” Baloney. in the last week pollsters get focused. this year is going a little different, though. Gallup, which is THE brand in US polling, has wisely decided not to risk losing that valuable position and appear to be doing it straight. Call it the rasmussen effect. check out all the polling they have done going back to carter. every cycle shows the dem outperforming their ultimate % dramatically up until the last week. same, of course, with ny times, abccbsnbcwashpost etc.

    • The Rasmussen poll swings 3-5 % for the Republicans.It was advertised on the website.If its close at debate time,Romney will have a problem.Who shows up,a conservative,liberal or moderate.A liar,as Newt Gingrich has called him,or a flip fopper.

  6. I’ve heard not one good word re: President Obama’s performance from anyone but rabid left wing adherents, but my sense is that no one wants to criticize him to pollsters because he has a cachet carefully developed by the press.

    I’m very glad for the secret ballot.

  7. Points well taken, and not to sound paranoid, but first of all it’s still early, and second, the polls don’t tell the true story. Wouldn’t be at all surprised to see a landslide on Election Day, in which case the pollsters are really going to have some explaining to do.

  8. Someone made a good point above. To elaborate on it: if you calculated unemployment and inflation in the same manner that you did in 1980, the misery index would be much higher today than “just under 10%.” The increased weight of housing/rent on the inflation calculation has served to dramatically disguise true inflation.
    I do think, however, that the media was, amazingly, more balanced in 1980. Notwithstanding talk radio, blogs and fox news, it is the big three free TV channels and the NY Times, Washington Post, AP and Reuters that have the most overall impact. And since the mainstream media’s impact has been estimated at about 5% points in an election – if Obama was getting Carter like coverage, the 5% pro-liberal swing would be sheared to something like 1%, and a landslide would be in the offing.

    Finally, those who note demographics make a good point. There are tribal mentalities among some sub-groups, and those mentalities have been cynically exploited by the Democrat party to attempt to fix their hold on power.

  9. Here is something else to add to the list: George W Bush.

    Make no mistake, Carter did not have the option to portray his economic disaster as something that clearly and definitively started during his predecessor’s term. There is no doubt that the current economic debacle erupted during the end of GWB’s term and that GWB’s profligate economic policies contributed to the economic crash. Obama simply offers that the choice between a Republican and a Democrat is no choice, so why change horses in mid-stream if they’re the same horses.

    I agree that Romney must make a compelling case for his economic plan. But he must do more: he must embrace Tea Party values and disavow the RINO economic values of the Republican establishment.

    • One point of disagreement: it was not the profligate economic policies of Bush that led to the 2008 Financial Crisis. Rather, it was the federal housing policies. These policies persisted under both Democrat and Repulblican leadership. To his administration’s credit, there were some feeble attempts to reign in these policies under Bush. But these inconsequential attempts were squashed by vicious attacks of Democrats and the media. Federal Housing policies — more than anything else — led us into the 2008 Financial Crisis. The FED has often acted nimbly to head off crises, but they fumbled the Lehmann issue badly, and a slowdown became the Great Recession.

  10. I guess it would be rude of me to suggest that Mr. Pethokoukis actually do some research before spouting off about the polls.

    Maybe look at the fact that polls in AUGUST/SEPTEMBER of 1980 between Reagan and Carter were TIED! just like Polls between Romney and Obama.

    It probably would also be counter to his narrative to point out that mid OCTOBER 1980 polls actually showed Carter with a 47-39 LEAD

  11. Dittos to topcat’s comment on the time curve of the Reagan ascendancy in 1980. It’s still early in the game.

    But one thing that won’t change is the difference in the media between 1980 and now. With the ascendancy of the Right, MSM has gone overtly hard left in order to protect its worldview. The 2008 campaign in particular marked their complete loss of integrity. The biased media is the foundation of all the other points of this article, because if the truth were plainly reported, obama wouldn’t have nearly the support he still maintains.

    Nonetheless, if the Pubs boldly continue to make this a campaign of issues, and do it in an above-board way, providing dramatic contrast to obama’s despicable campaign, Romney may well approach a landslide come November.

  12. The last time the Republicans controlled the government:

    DJIA: 12,800.18
    National unemployment rate: 4.5%
    Federal Budget Deficit: $247.7 billion
    Average GDP growth: 3.4%
    Median Home Value: $244,700
    Average price for Regular Unleaded Gasoline: $2.30
    Federal Debt as % of GDP: 64.55

    I’m surprised the Republicans aren’t just walking off with this election.

  13. I think when you look at this with the perspective of how early it is in an election where the one of the candidates is an incumbent, you realize it shouldn’t be this close yet if the President is going to win. The mere fact that the polls are virtually tied in most all of the swing states and moving within firing range in of some states that are traditionally blue like Wisconsin and Michigan, it says the momentum is going to put Romney well over the top. Not to mention, the fact that Romney has raised far more money and has yet to have spent it until the official nomination, says that the majority of the undecided vote is going to be in Romney’s favor. We already know Romney by far leads independents. Bottom line, Obama is in serious trouble.

  14. I agree with much written in the post and the comments. I think a better comparison is FDR rather than Carter. Most people think that Hoover and Bush were both bad presidents. They were both succeded by very bad presidents of the other party. This allowed the Democrats to effectively run against the Republicans because the electorat remembered what started the two messes.

  15. “Jimmy Carter won a close 50.1%-48% race to become president. Obama won by a near landslide, 52.9%-45.7%.”

    Hunh. 50.1% is close and 52.9 is a near landslide? Not very convincing. And Reagan won his actual landslide against Carter despite October polls showing them only a point or two apart. Each, I realize, had had wide leads over the other earlier in the year, but surely the moral to be drawn is _not_ that no landslide is possible. Anything is possible. All sorts of things — a total Euro collapse, de facto war between Israel and Iran — may well intervene. But even if it’s just the economy, stupid, the economy is much worse than it seems to the chattering classes, who have been almost completely unaffected. This blithe talk about not a recession, just a failed recovery means nothing to those whose new jobs pay 60% what the old jobs did. If Romney doesn’t fumble it, it may or may not be a landslide, but it really shouldn’t be close.

  16. Where’s the landslide? I seem to remember before the midterms in 2010 the same argument being given. Don’t worry its coming, you can just feel it growing right now.

  17. Let’s not forget that the polls for Reagan v. Carter were neck-and-neck right up to the day of voting; it was a “suprise landslide.”

    If you look at the historical FEC results 1980-2008, and assign a Political Inclination Quotient (PIQ) to each state, (low = Dem/high = GOP) you get a great moving picture of how 2012 will shake out. From http://www.PIQscore.com

    * Romney starts with 236 solid Electoral Votes (26 states with PIQ scores between PIQ-53 and PIQ-67), and another 26 likely (2 states at PIQ-52) = 262 Electorial Votes

    * Obama starts with 174 solid Electoral Votes (18 states, plus Washington DC, with PIQ scores between PIQ-12 and PIQ-48_, and another 49 likely (5 states at PIQ-48) = 223 Electoral Votes

    * That leaves 53 Electoral Votes up-for-grabs in MI, NJ, WV, NM, and IA (States with score between PIQ-48 and PIQ-51)… Obama will need to win 47 of them; Romney will only need 8.

    The actual state rankings are here:
    http://www.PIQscore.com/states

    • The number eight doesn’t mean much, though because none of those states has precisely eight votes. So what you’re really saying is Romney has to win MI or NJ. Or two of WV, NM, and IA. West Virginia is a gimme because it voted 55.7 for McCain–no way it flips to Obama. Hence, Romney by your analysis has to win one of MI, NJ, NM, or IA. He’s not favored in any of those, although Iowa is the most likely one for a breakthrough.

      In any case, I think how you arrive at the PIQ is flawed for a reason noted in the main article Since 1980 national demographics have changed–state demographics even more so. Not much light provided by including that election in predictions made 32 years later.

      As has been true of the last four elections, if the same candidate wins Ohio and Florida on election night, that candidate will be President. If that same candidate also wins Virginia, it won’t be a nail-biter.

  18. James,

    Are you comparing apples to apples with the misery index? Are unemployment and inflation figured the same today as in 1980? Same categories and stats?

  19. Misery index just under 10 today? If you measure unemployment and inflation like we did in 1980, I think you’ll find that’s not true.

  20. and Romney is George W. Bush II, especially with Hubbard and his voodoo economics to play again.

    Honestly, I don’t see how Romney wins.

    He gets none of the Black vote.
    He gets a small amount of the women’s vote.
    He gets a small amount of the Hispanic vote.
    He gets a small amount of the under 30 vote.
    He gets a small amount of the Jewish vote.

    Romney has two constituencies: older, wealthier White people, and the blue collar voters who are convinced he’s going to help them. That’s it.

    While all this has to play out electorally, this is one tough row to hoe for Romney. And that’s aside from the fact he has no ability to inspire or to motivate.

    • You ‘honestly’ will never be able to have a valid view of the electoral landscape when your inputs are simplistic pigeonholed concepts.

      Lets start with no priors as your ‘knowledge’ is biased. So, given no a priori information:

      In EV terms, RCP has Romney within 1.3pts of Obama in OH, FL, IA and VA. With the most important point being that Obama — as an incumbent — is polling under 47% in all these states. He’s rarely reached 50% in any singular survey, note the additional information we can extract from the strong correlations across polling samples that he’s stuck around 47%.

      Right here, that’s the election.

      In demographic terms, the game isn’t about ‘winning’ every demographic you list. It’s about *relative* wins by outperforming where you need to be; Romney wins just by narrowing the margin where it counts. He has dramatically cut into Obama’s lead in the demographic cross-sections that have the highest turn-out ratios: older voters, middle to upper middle income voters, voters with families, suburban and exurban voters, etc.

      Obama is doing well with those who are the least engaged, the least informational, the most hurt by his sub-par economy — the most likely to not vote. We have excellent proxy data on this by Obama’s atrocious FEC submissions on small-money donors which have drastically underpreformed 2008 in both number of contributors and size of contribution.

      A word of advice: the paradigm isn’t 2008. It’s a polarized 2004 electorate, with a swing component that’s disenfranchised like it’s 1980 and who hasn’t decided. Along with a Romney campaign that just got the go-ahead to turn Chicago into Dresden.

    • One additional data-point. Two polls released today:

      Obama is at 51% in NJ and 53% in CT, dramatically under-preforming his 57% and 60% levels in 2008. These are under John Kerry’s 2004 levels.

      We’re seeing this in the national numbers too, where the race is quite tight.

      Yet, in the battleground states, Obama has been competitive and leading. Sometimes by significant amounts, giving rise to this impression that Romney can’t win.

      I posit that what we’re seeing nationally and in the traditionally non-competitive states is the true state of the race based on the fundamentals, the economic reality, and how the voter landscape is tilting Republican.

      The battleground states are being held in a false vacuum state by Obama’s $130M+ advertisement campaign that has targeted these states specifically. Like all false ground states, when you remove the energy barrier holding them up — they collapse back to the true state, which couples to the national numbers.

      That point has arrived as Romney can start spending his large monetary advantage and Obama’s period of relative advantage has ended. I would expect we see the swing-state numbers regress back to the national mean — which doesn’t look promising for him given the fundamentals and weak ancillary blue-state numbers.

  21. Jimmy P….. Don’t forget, the media had it “too close to call” on election day 1980. Renauldus Magnus won by 10 points…. OK so Rom wins by 5 (that’s a low as I am willing to go)

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