So says Jonah Goldberg in USA Today as a rebuttal to supporters of Barack Obama in advance of the 2012 election. The latter have claimed that the trajectory of the 2012 election parallels that of 1984’s presidential contest, with high unemployment and a short distance from a sharp and painful recession. Goldberg points out that the trajectory isn’t similar at all — in fact, it’s nearly an opposite:
5.1, 9.3, 8.1, 8.5, 8, 7.1 and 3.9.
While that might sound like a controversial series of Olympic curling scores, these numbers in fact add up to a grave problem for Barack Obama.
They are the quarterly percentage gains in gross domestic product starting in 1983 through to Election Day 1984. And they aren’t the only significant numbers. In 1984, real income for individuals grew by more than 6% and inflation plummeted. The unemployment rate in November 1984 was still 7.2% — relatively high — but ithad dropped from 10.8% in December 1982, and it was clear the momentum was for even lower unemployment. “Staying the course” with Ronald Reagan made sense to most people, which is why he won re-election in a 49-state landslide.
Sadly for Obama — but far worse for the country — that kind of growth seems like a pipe dream. Last month, the Federal Reserve lowered its forecast for 2011 GDP growth from a range of 3.1% to 3.3%, made just two months earlier, to a much slower 2.7% to 2.9%. And it revised downward its projections for 2012 and 2013 as well.
The White House clearly assumed that they would see similar numbers from their stimulus package spending. As Jonah points out, Obama’s team encouraged comparisons to Reagan last year in anticipation of “Recovery Summer” and a wave of economic growth. Instead, the best quarter in the last five has been 2010Q3’s 2.8%, a number so anemic that it falls more than a full percentage point below Reagan’s worst quarter leading into his re-election. The initial Q2 number due at the end of this month will almost certainly fall below Q1’s 1.7%, and might go negative based on economic indicators in April and May.
Unemployment has also been just as problematic. Obama promised that spending $775 billion would keep the jobless rate below 8%. Instead, we have only had a handful of months below 9% in the two-plus years since the stimulus passed, and unemployment has started rising again. Civilian participation in the workforce has fallen to a 30-year low, masking the real jobless rate. The June figure is due on Friday, and like the Q2 GDP number, is almost certain to be unhelpful for the administration.
Obama has a year to get the economy moving in order for the comparison to be fully valid. By this time in 1983, however, Reagan already had a roaring recovery and a kick-start to the massive job creation that dropped unemployment by more than three full percentage points by the time of the election. The more relevant comparison might be George H. W. Bush in 1992, when a weak recovery had started by the end of 1991, but the perception of recession stuck with the electorate. And that might be the best-case scenario Obama has.