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July 06, 2012 10:25 AM How Economic Stagnation Is Processed Politically

By Ed Kilgore

So at this point in the 2012 election cycle, four months from balloting (and less for many voters), it’s an open question how much political impact will come from for the kind of uninspiring but undramatic economic news provided by today’s June Jobs Report. Most voters do not follow this sort of news, at all; they may be entirely unaware of it unless it produces more visible secondary effects like a big, multi-day plunge in the stock market. Yes, Republican gabbers will do everything within their power to draw attention to it, but since it’s a repetition of what they have been saying day in and day out since 2009, it’s unlikely to turn many heads.

Moreover, the kind of slow-to-no growth, stable-but-high unemployment, no-inflation “low plateau” the U.S. economy has reached and could well remain at through Election Day is experienced very differently by different kinds of people. It’s the equivalent of a slow-motion riot for the long-term unemployed, those with underwater mortgages, those entering the job market for the first time, and those hanging onto low-wage marginal jobs by their fingernails. But for a majority of voters, it’s like living in the first circle of hell: you have most of what you need other than hope.

In other words, the basic partisan divisions in a highly polarized electorate are unlikely to change much between now and November. There are no particular signs that either party will enjoy or suffer from a major “enthusiasm gap;” and the small undecided vote will be fought over viciously by campaigns deploying massive paid media resources in a relatively small number of battleground states and media markets. As has been the case since late last year, the incumbent president and his party will do everything within its power to make this a comparative election in which fears and doubts about Republican values and policy preferences matter most. Meanwhile, the GOP will continue to struggle for harmony between a presidential candidate determined to win an “economic referendum on the incumbent” and powerful party forces whose desire for a comparative election on a broad range of issues is even stronger than that of Democrats.

So Democrats shouldn’t despair over the stagnant economic indicators, and Republicans shouldn’t get complacent. Certainly the kind of economic environment of steady growth that looked possible earlier in the year would be have a major boost to Democratic prospects, and would have greatly increased the internal conflict between Republicans counseling a “safe” referendum strategy and those demanding all-out ideological warfare. But the best guess right now is for a maddeningly close contest on both the presidential and congressional fronts in which relatively small and un-newsy things—the value of the Obama campaign’s huge sunk investment in GOTV infrastructure and “voter protection” efforts; the effect of attacks on Mitt Romney’s character and background; the ability of Republicans to keep their restive and noisy “base” under control—may well determine the outcome.

Sure, it’s possible that late economic news, from a downward plunge triggered by global developments to a brief growth spurt enabled by a reluctant Fed, could be a game-changer. And maybe the outcome will vindicate those economists and political scientists who believe Obama’s already lost because—contrary to the evidence of such supposed “outliers” as the 2004 elections—late deciders will be deaf to any negative information about Mitt Romney and will break against the incumbent absent big positive economic developments or a foreign policy crisis. But the odds are high that what we see is what we’ll get, and that’s a nail-biter.

Ed Kilgore is a contributing writer to the Washington Monthly. He is managing editor for The Democratic Strategist and a senior fellow at the Progressive Policy Institute. Find him on Twitter: @ed_kilgore.

Comments

  • c u n d gulag on July 06, 2012 10:49 AM:

    Mitt's and the Republican's plans are "W on Steroids."

    They're going to double-down on everything feckin stoooopid that led to this disaster in the first place - all to break the middle class and this country even faster.

    And, with their voter suppression efforts and propaganda, and the sheer laziness, stupidity, and/or ignorance, of too many of the so-called "Independent" voters, they may very well win.

    If people don't realize by this point in time that W and Republican Congresses, or compliant fairly evenly-split ones (due to 9/11), led to the massive tax breaks for the richest, two wars and occupations, and de-regulations of financial markets, that caused this mess we're in, then, we are TOO stupid to remain a representative democracy.

    Let the the reign of The Dominionists and Plutocrats begin.

    I'll 'see you in the gulag."

  • Varecia on July 06, 2012 11:00 AM:

    "...So Democrats shouldn’t despair over the stagnant economic indicators..."

    And anyone who is paying attention will also know that each week there are various sorts of economic reports with widely ranging and often apparently conflicting news, such as the recent very good report on new housing starts. I watch the Nightly Business Report every night and what I've noticed is for some time is that for each discouraging type of report there will be another type of economic report or metric that seems to indicate we are not in as much stagnation as some would have us believe.

  • boatboy_srq on July 06, 2012 11:28 AM:

    [F]or a majority of voters, it’s like living in the first circle of hell: you have most of what you need other than hope.

    There was an article out recently - I think in NYT - discussing how employment without confidence of permanency was actually more stressful than unemployment: the day-to-day uncertainty that one's job would still be there, along with the continuing search for something more durable, caused more anxiety than simple unemployment and searching for work. It's definitely a circle of hell - but I'd put that a little lower than the first one: for the contract- and short-term- employed, there's more than hope that you're doing without. And as the proportion of the employed labor force in this situation increases, that stress level will only grow, and the dissatisfaction with the status quo will only increase.

    The only reason there's less agitation from this sector of the labor pool than from the unemployed or housing-stressed is that there's less free time for these folks to agitate.

  • Barbara on July 06, 2012 11:31 AM:

    I personally think much of the flatness is due more to what is happening in the EU. There are a lot of mixed signals, and I suspect that your personal economic situation is being affected by a mixture of plus/minus developments that have a lot to do with how you are connected to the global economy. At any rate, realizing that I am probably an extreme consumer of news, I do wonder whether people following the nightly news even in passing are picking up on the fact that as difficult as things seem here, what's happening in Europe is truly frightening.

  • sjw on July 06, 2012 11:40 AM:

    The election could be less of a nail-biter if the Obama campaign made more of Republican obstructionism on job creation. For example, the recent hit on infrastructure in the mid-Atlantic states could have been an opportunity for Obama. But he's a little slow on getting it: today he's taking the tired "84,000 jobs" ain't bad line. Geez. He'd do so much better if he said "it's bad and we can do better," then laid out his proposals one by one.

  • RalfW on July 06, 2012 12:16 PM:

    I wouldn't bet on Bernanke doing a damn thing. One wonders if he's 'early voting' for Mittens by way of joining the GOP plan to trash the "Democratic" economy.

    If we get a Romney admin, I'd expect a sudden distancing from an inflation-hawk Fed.

    It's really too bad that the SCOTUS and the Fed have become so partisan - especially when GOP policies are likely exacerbate income inequality, toss any sense of environmental stewardship to the trash-heap of history, and revel in 50,000,000++ American w/o health insurance.

    All for what, preservation of tax status for the already spectacularly wealthy? What a deal we got in appointing this Fed.

  • jjm on July 06, 2012 12:25 PM:

    Well a recent poll said that most people think the economy would NOT be changed much by either of the two candidates.

    So, to my mind that means they will be deciding on the basis of other factors than 'the economy" (which as @Varecia points out, is reported on in multiple venues in multiform ways).

    Why have 'economists' become the only social scientists left in the world? They're not good at reading society -- while those among them who do understand that economics reflects society and is about people and their activities and not just the exchange of imaginary money at the top, e.g., Krugman and Stiglitz, are never really listened to by politicians.

  • howard on July 06, 2012 12:40 PM:

    one thing we can with certainty: there is no specific measure that can now be taken that would absolutely and unquestionably have a positive economic impact by november. it's all going to be random chance.

    but what we see in the polling data is that non-republican voters don't seem to blame obama specifically, and that's good enough to get him a win.

  • Liz on July 07, 2012 8:58 AM:

    Your comments seem on-target to me, and a wholesome counter to the kind of hand-wringing I've been reading, but I wish you would proofread. "Will come from for the kind" in your first sentence; "earlier in the year would be have a major boost" later. Careless editing makes for jarring reading.