Thursday, July 26, 2012

Deja Vu? 2004 or 2012?

As this long summer campaign continues it becomes more and more apparent that 2012 has a lot in common with 2004, at least from an electoral perspective.  Like 2004, 2012 is a presidential election year featuring an incumbent wrapping up his first term with middling approval ratings.  At a similar point in July 2004, an NBC/Wall St. Journal Poll found President George W. Bush with a 48% approval rating.  Eight years later the most recent NBC/Wall St. Journal Poll gives President Obama a 49% approval rating.

In 2004, the nation was experiencing tepid economic growth rates in what was called a 'jobless recovery' from the recession of 2003.  Today, economic growth is exceptionally slow following the depression of 2007-09.  The unemployment rate when George W. Bush became president was 4.2% and rising.  It rose 50% to peak at 6.3% in the summer of 2003 before declining to 5.6% by July 2004.  Unemployment when Barack Obama became president stood at 8.3% and rose another 20% to peak at 10% in October 2009 before slowly declining to its current 8.2% level.

The 2004 Presidential Election featured a likable president, with less than stellar approval ratings, facing off against privileged Vietnam War vet and multi-millionaire, Massachusetts Senator John Kerry.  America was in the midst of two wars, one becoming very unpopular and a drag on the incumbent.  Senator Kerry's strength was his military experience so the incumbent strategy was to cast doubt upon the senator's fitness to be Commander in Chief.  The effort led to the Swift Boat attacks against Senator Kerry shortly before election day as well as attempts to cast doubt on President Bush's service in the Texas National Guard.  The continued fear of terrorist attacks made Americans hesitant to change administrations in the midst of two wars.

Fast forward to 2012.  Both of the wars from 2004 are winding down and the economy is recovering slowly from the steep cliff it went over in 2008.  The Presidential Election features a blue blood challenger in former Massachusetts Governor Mitt Romney with mediocre likability ratings and an incumbent president who is likable but struggling with his approval ratings.  Unlike in 2004, President Obama will not have the fear of terrorism to boost his campaign.  The focus is, and will remain, on the economy.  Thus, the president and his team will seek to cast doubt on Governor Romney's claims that he can fix the economy based on his business experience at Bain Capital.  The Romney team will argue that the president's policies have failed to turn things around.

The latest polls show the race in a virtual dead heat, not an enviable position for an incumbent to be in.  But it is a position remarkably similar to where President Bush found himself in 2004.  In 2004, the incumbent prevailed by 2.5 percentage points in the popular vote.  The race essentially came down to a single state, as it had four years earlier.  In 2000, as everybody knows, it was 'Florida, Florida, Florida' in the words of the late Tim Russert.  In 2004, it was Ohio, Ohio, Ohio.  President Bush carried the state by 118,000 votes out of more than 5.5 million ballots cast.  A swing of just 60,000 votes would have given Ohio's 20 electoral votes, and the presidency, to Senator Kerry.  President Bush was helped by a late October video released by Osama bin Laden taking credit for the 9/11 attacks, stirring up a fresh reminder to stay the course in the war against terrorism.  Will there be an 'October Surprise' for President Obama as he urges Americans to stay the course and have faith that his policies will eventually lead to the economic recovery Americans want and need?  Only time will tell.

Saturday, July 21, 2012

POTUS Election 2012 Update

I haven't done one of these for awhile so I figure it is time to update the chart for the Presidential Election in light of all the new polls that have been conducted.  While I still do not think the polls tell us anything about who will win in November, they may reveal any trends taking shape.  So let's get to the numbers!

Gallup Daily Tracking Poll

One thing that is pretty clear in the above chart is that the race between Mitt Romney and Barack Obama has remained exceptionally close for the first two months of summer.  In spite of a barrage of negative ads run by both campaigns, the polls have failed to move much in either direction.  There are a few explanations for the lack of movement to date:
  1. The preference stability of the American electorate.  Most voters, even those who claim to be independents, vote according to their partisan leanings.  Only a small percentage of voters actually change their minds over the course of a campaign and end up voting for the opposite candidate.
  2. Americans are not paying much attention to the race yet apart from a cursory glance at who's ahead every now and then.  The very small contingent of ideologically driven voters are always paying attention but the mass public doesn't generally do so until well after labor day.  So it is not surprising that neither side is making inroads at this point.  
  3. Much of the battle being waged between President Obama and Mitt Romney is taking place in six or seven 'battleground' states.  The likely electoral outcome is already known in more than 80% of the states.  Mississippi will support Mitt Romney in November, California will support Barack Obama.  The election will be settled in just a few states representing about 15% of the population.  As a result, most of the nation will see very little of the actual campaign or the ads.  Only those who actively seek information outside the 'battleground' will likely be exposed to the campaign.

General Election Polls

The other set of polls we have are from news and polling organizations such as Fox, CBS, and Pew Research.  As with the Gallup Daily tracking polls, there is a stability in these polls, although we can see a bit more movement in some than in others.  Fox and Pew Research have consistently had President Obama with a larger lead than most of the others.  CBS has had the race closer and is the only recent poll that shows Mitt Romney in the lead, albeit by a single point.  Most of the polls, except Pew and Fox, are within the margin of error.  What may be more important at this time are the state level polls in the 'battleground' states.  Nate Silver has an excellent recap of these on his blog.

The next few weeks will likely show more of the same as the start of the London Olympic games overshadows the presidential race until mid-August.  Romney will then likely announce his running mate, which will catapult him into the lead through the end of the Republican National Convention on August 30th.  The convention 'bounce' will likely dissipate the following week as the Democrats hold their convention in Charlotte, NC through September 6th.  President Obama will likely resume leadership in the polls by around 4-5 points.  Then the gloves will come off, the whips will be readied, and the horses will head down the backstretch toward the final turn.  For political junkies like me, it will be a fun ride!

Friday, July 20, 2012

The Bane Of It All

I'm sure everyone knows that Mitt Romney founded and directed Bain Capital for many years and reaped a personal fortune from his shrewd management, timely investments, and, yes, occasionally making deals that resulted in people losing their jobs, companies going bankrupt, and other forms of collateral damage.  So what?  That's what capitalism is and does.  For better or worse America has chosen to embrace a state-supported form of capitalism.  Now one of the barons of American capitalism is seeking to become the Chief Executive Officer of the free world.  Bain Capital has become the bane of Mitt Romney's presidential aspirations.  Why?

It's not that Romney's a wealthy guy or made a lot of money as a capitalist.  Americans, liberal and conservative alike, celebrate successful entrepreneurs (ask Bill Gates or Warren Buffett).  Most of us at one time dreamt that we could one day be like them, even though 99.99999999999 percent of us will never move beyond middle class no matter how hard we work.  Upward mobility in America is a myth perpetuated by politicians and the privileged class to mollify a population saddled with heavy debt and stagnant wages.  One recent study indicates that those wanting to climb the ladder of social mobility have a much better opportunity of doing so in most European countries than they do in the United States.   But I digress.

No, the reason Bain Capital is, or at least should be, an important issue in this election is because Mitt Romney has made it the central claim for why he should be elected president.  His argument is that he worked in the real economy, knows how to create (and destroy) jobs, knows what it takes to act as Chief Executive and be personally responsible for the people under him.  All these things are good things. But curiously, Romney now wants Bain to be off limits to scrutiny from the press, the public, and his opponent.  It is somehow an 'attack on success' to ask questions about exactly what did Mitt Romney do at Bain? How involved was he in decisions that exchanged equity for debt and led to companies filing for bankruptcy while Romney and his investors reaped tens of millions of dollars?  The man who wants to be America's CEO needs to provide Americans with a full accounting of his tenure at Bain Capital if he expects us to trust him with the most precious and powerful office in the world.

That's why it is imperative that Mitt Romney release his tax returns, not just for a year or two, but probably for 20 or 30 years.  How much did Mitt Romney profit while the employees at companies Bain invested in suffered as they lost their livelihoods and companies?  We have a right to know if we are going to invest this man with the power of the American Presidency.  Nobody cares, or should care, that Romney is part of the 1%...most of our political leaders are in that group...what we should care about is what he did to get there.  The name of the company Mitt Romney founded, Bain, is a homonym with the word bane.  Dictionary dot com defines the word bane as follows:


a person or thing that ruins or spoils: Gambling was the bane ofhis existence.
a deadly poison (often used in combination, as in the namesof poisonous plants): wolfsbane; henbane.
death; destruction; ruin.

Ironically, what Mitt Romney did or did not do at Bain Capital may be the very thing that ruins his presidential ambitions.

Tuesday, July 3, 2012

Fighting the 'Submerged State:' Why Conservatives Really Fear Barack Obama

Conservatives are right to fear President Barack Obama and his agenda.  Of course, they spin deceitful lies about what the president is up to, where he was born, label him as a muslim, call him unpatriotic, and many other partisan political attacks in an effort to delegitimize him in the eyes of the American people.  All of these efforts are simply methods of obfuscation on the part of the GOP.  In other words, the Republicans want to confuse and confound the American people by calling things what they are not.  A few examples come to mind quickly, such as the nonexistent yet infamous 'death panels' in the Affordable Care Act and PolitiFact's 'Lie of the Year', the government takeover of health care.  Neither of those things are a part of the law but the truth can be so limiting that Republicans feel they might as well make stuff up to scare the unwashed masses, who remain largely ignorant of public policy and who benefits from it.  Suzanne Mettler (The Submerged State: How Invisible Government Policies Undermine American Democracy) makes a convincing argument that people are ignorant about government policies and their beneficiaries, especially social welfare policies, largely because they have been 'submerged' into the modern state.  In short, people who receive the benefits of these policies aren't even aware of the fact they are receiving government benefits.  Barack Obama's presidential campaign in 2008 was largely about exposing the submerged state so that citizens would understand 'who gets what and how,' as Harold Lasswell famously stated.  That's what really scares conservatives about President Obama.

We've all heard the phrase uttered by the ignorant Tea Party conservative about keeping the government's hands off 'my' Medicare, right?  Perhaps you think that's an extreme example?  Consider the results of a survey of government issues conducted in 2008.  One of the questions asked respondents if they had ever received benefits from a government program.  Nearly 57% of respondents said they never had.  Later in the survey, 19 government programs were identified and it turned out that over 91% of respondents had used at least one government program at some time in their life, many without ever realizing it was, in fact, a government program.  For example, 60% of people claiming the Home Mortgage Interest Deduction (HMID) said they had never benefitted from a government program.  Yet, the HMID is the 2nd largest tax expenditure in the IRS code, costing approximately $105 billion a year.  The vast majority of beneficiaries of this program apart from realtors, construction companies, and bankers?  American families with earnings of $60,000 a year or more.  In other words, it is a government program for the top 25% of income earners in the country.  Citizens with lower incomes typically don't have enough other deductions to itemize on their tax returns and thus are unable to claim this benefit.  A broader question that I won't answer here is why does the government subsidize economic activity that consumers are likely to engage in anyway?  It isn't as though wealthy Americans will stop buying homes and begin renting apartments if they are unable to deduct mortgage interest, is it?  Don't get me wrong, I've been able to claim this deduction for the last several years and I'm happy to do so.  A few more examples:  52% of people claiming the child and dependent care tax credit don't think they received a government benefit. Really?  My two favorites are the federal student loan program (53% of recipients don't think it is a government program) and Social Security (44% don't see it as a government program).  On the latter program people seem to believe they are only receiving back what they paid in.  Right.

Why do conservatives (and some Democrats) fear Barack Obama's attack on the submerged state?  Because many of their financial backers are dependent upon the subsidies they receive from submerged government programs.  Take the Republicans opposition to Obama's plan to end the more than $6 billion a year in federal subsidies to banks making student loans.  Student lenders spent on average about $80 million a year lobbying Congress in an (unsuccessful) effort to take student loan programs out of the hands of the private banks and create a direct lending system in which the government is the creditor, allowing more students access to federal loans at lower interest rates than ever before.  Guess what just disappeared?  Nearly $20 million a year in campaign contributions from student lending institutions to 'friendly' Republicans and Democrats.

This is just one example of Obama's war on the submerged state.  There are many others, including health care and the real estate industries (each contribute about $140 million to political parties, PACs, and campaigns annually), which spend about $60 million each per year on lobbying activities.  The benefits received by these industries each year is measured in billions of dollars.  And it's all under the radar of most Americans.  We see rallies and protests against government welfare programs designed to aid the poor and unfortunate, like providing health insurance to low income workers, but nary a word against the upward redistribution of wealth to bankers, realtors, and big pharmaceutical companies.  In the end, Mettler argues, the invisible nature of these programs disconnects citizens from their government.  Unearthing and making citizens aware of these issues may lead to a more activist base of citizens who get involved with their government.  This is why conservatives fear Barack Obama.  It is why they oppose full disclosure laws when it comes to political spending.  It is why they oppose 'Obamacare.'  It is why they support unlimited spending by wealthy corporate interests to sway the outcome of American elections in their favor.  A fully informed citizenry just might say enough is enough and put an end to the influence of big business in politics.  And that would have disastrous results for the party of big business, the GOP.