When President Obama took office amid an economic crisis in 2009, the prevailing assumption was that the economy would be recovering by the time he ran for reelection, and that he’d therefore be a strong candidate to win a second term. For the last year or so, though, the economy has stubbornly failed to cooperate, and pundits began to acclimate themselves to the assumption that he’d be highly vulnerable, if not a dead man walking.
But the economy is, step by step, looking stronger.
Today's report of 200,000 new jobs in December and 8.5 percent unemployment seems to fit a general trend. Jobless claims have fallen steadily, forecasters expect to see fast growth in the fourth quarter of 2011, and some of the disasters that held back the economy in the last year (the Japanese tsunami, the Libya oil shock, the Republican debt-ceiling hostage crisis) have all receded. With the obvious caveat that predictions are hard, it’s looking more and more like a real recovery may finally be upon us.
Obviously this matters primarily insofar as it alleviates mass immiseration. But the political implications cannot be denied – for all the time we in politics spend scrutinizing political messaging and tactics, the state of the economy matters far more than anything else. Political analysts are continuing to repeat the default assumption that Obama’s reelection will be tough, but it is starting to look like it might be not so tough after all.
Defeating an incumbent president, historically, seems to require either a major scandal, a failed war, or a terrible economy. We have a terrible economy. But the direction seems to matter more than the level — Ronald Reagan famously cruised to reelection with a high unemployment rate because the economy bounced back from the deep but quick 1982 recession. Mitt Romney has made the state of the economy his central theme against Obama. The entire premise of his campaign is that the economy is bad because Obama's economic program has failed.
If voters think the economy is improving, Romney has no ammunition left. That is still the smart play for Romney, because if the economy feels strong, he probably can't win anyway, so he needs to plan for the scenario that gives him a chance to win. A few months ago, that scenario was looking almost certain. Now it's looking far less likely.