Elections 2012: Romney's biggest hurdle – Economy Is Getting Better
Here are four words that trouble Republican challenger Mitt Romney: The economy is improving. Romney’s entire campaign thesis has been the failure of President Barack Obama to repair the economy after four years in office.
But now good economic numbers are starting to pop up. (That leaves Romney tonight with a tough choice: Does he continue to say things are bad or does he root for the improving economy and shift his focus to other issues.)
Last week many of Romney’s supporters complained about the improving job numbers when the Bureau of Labor Statistics employment survey. Former GE chief executive Jack Welch wrote in The Wall Street Journal that, “even if the BLS had a perfect process, the context surrounding the 7.8 percent figure still bears serious skepticism.”
Welch said “the reality is the economy is experiencing a weak recovery. Everything points to that.”
But is that still true a week later?
On Tuesday Gallup Economy reported “Americans’ economic confidence, on a weekly basis, is now at the highest level Gallup has recorded since late May.” That rating still shows more Americans saying the economy is getting worse, but that number is shrinking.
But that’s not the only plus sign. Government data showed that consumer spending ticked up last month. That’s important because the category of consumer spending reflects two-thirds of the economy. (Part of what’s driving that gain is the new iPhone 5 and the cost of gasoline.)
And there’s more. Homebuilders say the economy is picking up for them, too. “Builder confidence in the market for newly built, single-family homes edged slightly higher for a sixth consecutive month in October ... the latest, one-point gain brings the index to 41, its strongest level since June of 2006,” reports the National Association of Home Builders.
Industrial production also increased in September by four-tenths of a point. That doesn’t sound like much, but a month ago that number was negative at 1.4 percent. Even mining which is supposed to have had a rough go under the Obama Administration grew at an annual rate of 3.8 percent, according to the Federal Reserve.
Perhaps the widest metric is the stock market.
“The best single predictor of presidential re-election results that we found was the percentage change in the stock market during the three years that preceded Election Day,” according to Deepak Goel, one of the authors of a study by The Socionomics Institute. “Changes in stock prices had a positive, substantial and statistically significant association with incumbents’ performances in re-elections. We found that they accounted for more than a quarter of the variation in incumbents’ popular vote margins.”
Even though most people don’t own stocks – certainly across the board in Indian country – it serves as a measuring device because it reflects public mood. A rising stock market is a purchased belief in optimism, that the economy is getting stronger and will reward investors.
The Socionomic study looked at every presidential re-election campaign, starting with George Washington’s successful bid of 1792. They found that incumbents who served during periods of rising stock prices typically do better in the elections than those who served during periods of falling stock prices.
And the stock market under Obama? The low point hit on March 6, 2009, when the Dow Jones Industrial Average stood at 6,626.94. Yesterday the industrials closed at 13,542.26 -- and they’re up again today.
Long term there remain significant challenges to improving the economy and getting more people employed. Who knows how, or even if, Congress will address the fiscal cliff? That is the coming crisis that was generated by the expiration of Bush-era tax cuts and promised deep spending cuts. We won’t know what will happen until after the election.
But for now the economy is getting better.
Mark Trahant is a writer, speaker and Twitter poet. He is a member of the Shoshone-Bannock Tribes and lives in Fort Hall, Idaho. He has been writing about Indian Country for more than three decades. His e-mail is: firstname.lastname@example.org.