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Unemployment and Presidential Elections

Unemployment was high when Barack Obama took office and it’s gotten substantially higher. Does that mean he won’t get re-elected? Nate Silver looks at the data and says no.

An article in today’s Times notes, for example, that “no American president since Franklin Delano Roosevelt has won a second term in office when the unemployment rate on Election Day topped 7.2 percent.” The 7.2 percent figure refers to Ronald Reagan, who resoundingly won a second term when the unemployment rate was at that number in November 1984.

This type of data may be of limited utility for predictive purposes, however. Reagan won re-election by 18 points in 1984, suggesting that he had quite a bit of slack. An unemployment rate of 7.5 percent would presumably have been good enough to win him another term, as might have one of 8.0 percent, 8.5 percent or even higher.

It’s also not obvious that Roosevelt should be excluded from the calculus, particularly given that the economic crisis the country is working its way out of is the most severe since his administration. He won re-election in 1936 with an unemployment rate of 16.6 percent, and again in 1940 with a rate of 14.6 percent.

Obama started with 7.8 percent unemployment. It was 9.0 percent in April, the last month for which we have numbers. [May’s unemployment rate was just announced at 9.1 percent.] But Silver can’t find any real evidence that this is decisive.

Unemployment increased by 1.9 percentage points over the course of Richard Nixon’s first term, but he won re-election overwhelmingly. It also increased during George W. Bush’s and Dwight D. Eisenhower’s first terms, and their re-election bids were also successful. The unemployment rate fell to 3.9 percent from 5.3 percent, meanwhile, during Bill Clinton’s second term — but his Vice President, Al Gore, could not beat Mr. Bush in the Electoral College.

There are also cases in which the data behaved more intuitively: Gerald Ford, Jimmy Carter and George H.W. Bush all faced high unemployment rates when they lost their re-election bids, and that was surely a factor in their defeats. But historically, the correlation between the unemployment rate and a president’s performance at the next election has been essentially zero.

He’s produced this handy dandy chart:

He also has numerous plot graphs looking at different aspects of the relationship. None are particularly insightful. Presidential elections are relatively rare events, giving us few data points. And, quite obviously, they’re decided by human beings who weigh multiple factors.

So, unemployment doesn’t matter, at all? Silver won’t go that far.

[I]t is entirely permissible to default to common sense, which is that the unemployment rate should have some effect on a president’s re-election chances.

The problem is that whatever signal there is gets filtered through an awful lot of noise. Consider:

  • The unemployment rate itself is subject to fairly significant measurement error.
  • Voters will interpret the unemployment rate in different ways, and assign the president varying amounts of credit or blame for it.
  • The unemployment rate is but one of a number of salient economic indicators.
  • Economic performance is but one of the ways that voters evaluate a president.
  • Voters’ evaluation of a president is important, but they also consider the the strength of a president’s opponents, including third-party alternatives in some elections.
  • If you could hold each of these other factors constant, you could come to a more confident conclusion about how much each tick in the unemployment rate affects Mr. Obama’s re-election odds. But the real world is not set up with these sorts of experiments in mind, and since presidential elections are infrequent, the likelihood that truly comparable cases will exist the historical data is relatively low.

    It’s fair to say that the worse the public perception of the economy–which is certainly influenced by the unemployment rate–is, the more vulnerable the incumbent is at election time. If unemployment is down to, say, 6 percent on Election Day, Obama is a virtual shoe-in because the public is otherwise disposed to like him. If it’s above 10 percent, voters will be more inclined to want someone new. But they have to have an alternative that’s likable and trustworthy.

    Even then there will be other factors, since as third party candidates. Al Gore would easily have won in 2000 had Ralph Nader not siphoned off a lot of votes in close states, particularly Florida. If there’s a significant Tea Party candidate on the ballot in addition to the Republican nominee–which seems much more likely than a significant Progressive candidate– there’s almost no way Obama loses.

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    About James Joyner
    James Joyner is the publisher of Outside the Beltway, an associate professor of security studies at the Marine Corps Command and Staff College, and a nonresident senior fellow at the Atlantic Council. He's a former Army officer and Desert Storm vet. He earned a PhD in political science from The University of Alabama. Views expressed here are his own. Follow James on Twitter.

    Comments

    1. john personna says:

      Hey, at least Sarah Palin will keep the British away from our guns.

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    2. Mr. Prosser says:

      “Voters’ evaluation of a president is important, but they also consider the the strength of a president’s opponents, including third-party alternatives in some elections”
      Please don’t ignore the first half of that sentence. Unless there is some major change in the Republican field the GOP has no chance in ’12. By ED Kain’s ratings I’m a “High Liberal” and I didn’t vote for Mondale in ’84.

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    3. Tsar Nicholas II says:

      You can’t beat something with nothing. Just ask Harry Reid and Sharron Angle.

      Like or Dislike: Thumb up 1 Thumb down 0

    4. Dave Schuler says:

      If unemployment is down to, say, 6 percent on Election Day, Obama is a virtual shoe-in because the public is otherwise disposed to like him. If it’s above 10 percent, voters will be more inclined to want someone new. But they have to have an alternative that’s likable and trustworthy.

      I think that’s generally right. We tend to re-elect incumbents. We tend not to re-elect incumbents when economic conditions are deteriorating and the incumbent doesn’t appear to have a plan for dealing with it or we have lost confidence in the incumbent’s ability (or willingness) to implement his plan.

      Second term campaigns are different from campaigns to serve a first term. The votes are invariably and inescapably referenda on the incumbent.

      However, I’m less certain about the importance of who the opponent is than you appear to be, James. In particular I would caution people not to let their hatred of Republicans, generally, or disdain for a Republican candidate blind them to the fact that the view isn’t universal.

      I voted for Obama in 2008 and may well vote for his re-election. However, if the economy is deteriorating, President Obama appears to be flailing, and the Republican candidate doesn’t appear frightening, moderates and independents could well turn to the Republican candidate and it is moderates and independents on whom elections hinge.

      Bottom line: the odds are still with Obama but he’s not invulnerable and the 2012 election will be about Obama more than it is about his opponent.

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    5. James Joyner says:

      Dave, I think that’s right. I think a Romney, Pawlenty, Huntsman, or Perry could beat Obama if the economy continues on this track. I think he’d get reelected with 20 percent unemployment running against a Palin or Bachmann.

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    6. steve says:

      James- Hence your dilemma. Can any of the former group win the nomination? In primaries, Palin’s true believers will come out no matter how bad the weather. Nothing any of the other nominees can say will shake their belief. hey will just claim that the Romney/Huntsman crowd are getting support from the LSM. This kind of uncharted water for the GOP, but I think that years of employing the energize the base tactic will result in the nomination of a more fringe candidate.

      Steve

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    7. anjin-san says:

      Given the economic train wreck Obama inherited, the increase in unemployment over the last 2.5 years is not outrageous. Of course, the electorate may not see it that way. The good news for Democrats is the anemic nature of the GOP contenders, and the generous nature of the GOP house.

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    8. bandit says:

      If excuses fixed anything we’d be all set now. I don’t think there’s much chance that unemployment is in the 6’s a year from now but if it is I’ll vote for Obama. My guess is high unemployment persists and all the excuses in the world won’t help that but if the trend is down next spring/summer Obama wins.

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    9. Steve Verdon says:

      The trend is what is important. Roosevelt had declining unemployment, so did Reagan. Obama is seeing unemployment stall in its downward decent. Maybe it is temporary. So,

      If the unemployment rate resumes its downward decent he’ll likely win.
      If it stays stalled his chances get worse for re-election.
      If it starts going up, he is DOA.

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    10. Lit3Bolt says:

      Nate Silver has trouble with this analysis since we’re predicting electoral conditions 18 months in advance of the event, and the mind of the average non-primary voter. Obama’s electoral strategy may be to let the Republican Houses exhaust themselves on debt threats for the next few months, then pivot and focus on the economy and jobs during January 2012 while most of the Republican field will be tied up between in-fighting and purity tests in Iowa, NH, etc. Then the Democrats will point to the Republican field and say “they are more concerned about (random issue) than your job security.”

      That may be giving the Democrats far too much credit, however. I honestly believe that if any Republican President had bagged OBL, then I could say with certitude that the election was in the bag for that incumbent President (indeed, such was my reaction in December 2003 when Saddam was bagged).

      Obama is very beatable in 2012. However, the Republican Presidential purity tests are taking a toll on their candidates. You must not have ever expanded government, taxes, healthcare, gun control, pardons, scientific research, gay rights, affirmative action, immigration amnesty programs, union rights, education, and must be pro-corporate, pro-religion, pro-Israel, pro-life, pro-Drug War, pro-War on Terror, pro-Creationism, and pro-drilling with zero skeletons in your closet and no history of bipartisanship. Small wonder than what’s left are Know-Nothings, dry as toast technocrats and delusional businessmen.

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    11. Sam Penrose says:

      I appreciate the pointer to a good article; I’m surprised to see that you have reproduced a good chunk of it while adding much less material of your own.

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    12. The two factors to look at economically are, “Are we in a recession”? and “Does real per-capita economic growth during President Obama’s term equal or exceed mean growth during President Bush’s tenure”? James is also right ti point out that there will be other factors as well. The important thing to remember is that the FDR unemployment statistic is a red hearing and the observation that that is somehow relevant is not in any way empirical.

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