Why Obama could still lose in November
Worsening jobs figures, Romney's ad blitz and low approval ratings are reasons for Obama not to be complacent.
By Richard Mylles Published 21 September 2012 13:42
A somewhat blithe consensus has built up around the view that Mitt Romney is destined to lose the US presidential election. Prediction markets Intrade and Iowa Electronic Markets have the incumbent on 70.3% and 72.4% respectively to win, whilst Nate Silver, a superstar election seer, has Obama a huge 76.1% favourite. But for all the President’s advantages, and they are admittedly formidable, a good deal of uncertainty remains going into the final six weeks of the campaign. Here are three reasons why the race is more unpredictable than most pundits appreciated.
1. The economy, stupid. Long before the Clinton campaign coined that famous maxim, politicos have known that the single most important factor in presidential elections is the state of the economy. Ronald Reagan’s question to the nation in 1980, "do you feel better off than you did four years ago?" was widely thought to have skewered the hapless incumbent Jimmy Carter. Romney is clearly looking for the same tactic to work in 2012. The irony of Carter’s predicament was that in fact about ten million jobs had been created during his presidency – his misfortune was that the recession began in his re-election year, creating the impression of failure at the worst possible time. Obama’s job creation numbers are far worse than Carter’s: the economy has (narrowly) lost jobs since his election and only 4m of the 9m jobs lost in the recession have been recovered. Moreover, no president since Roosevelt has been re-elected with unemployment at more than 7.2% (it is currently 8.1%). But, like Roosevelt, Obama inherited a horrendously underperforming economy and, as with Roosevelt, the economy appears to be improving as his re-election approaches.
The danger for Obama, however, lies in the precariousness of the jobs growth figures. Some point out that the unemployment rate has been flattered by discouraged workers dropping out of the labour market. And the weak jobs growth figures from September – along with the current level of the ISM - have set up a tense end-game for the Obama administration. With two more months of data to come, Obama could be hugely damaged should those figures turn negative in the run-up to polling day.
Chart 1: US unemployment
2. This is the year of the super-PAC The incumbent funding advantage in presidential elections usually works in two ways: firstly the incumbent simply raises more money in most years due to their greater familiarity with donors and the tendency of backers to prefer a proven winner over an insurgent challenger; secondly, they generally avoid the costly battle for their party’s nomination that drains the challenger of cash before the real contest has ever begun. Both these advantages hold this year too (Obama had raised $600m in total to Romney’s $335m by the end of July), but they should be greatly mitigated following 2010’s controversial Supreme Court ruling in Citizens United v. the FEC. This ruling essentially eliminates the restrictions that existed on individual and corporate donations to "political action committees"; as a result, deep-pocketed donors, of which the Republicans seem to have rather more than the Democrats, will be able to target unlimited ads at the key swing states in the final weeks of the campaign.
The impact of these super-PACs was huge during the Republican primary, with Mitt Romney’s Restore Our Future super-PAC vastly outspending his rivals and destroying big poll leads, like Newt Gingrich’s 20-point lead in Florida, with a deluge of negative ads. Of course, it won't be so easy for Romney to squash President Obama in this manner. For one, he has his own super-PAC, albeit one less well-funded. It also remains unclear whether the Republican super-PACs have raised anything like the kind of funds some were predicting (data going up to 31 July showed a relatively modest $140m between them). But their eventual impact is impossible to predict, which leaves open the possibility they could make a critical difference in the crucial swing states like Florida and Ohio come November.
3. Approval ratings still dangerously low. Obama’s approval ratings are nowhere near high enough at this stage to justify complacency. Most analysts expect the bump he enjoyed following the Democratic Convention to fade by the end of September, which should erode much of the lead that appears to have excited prediction markets. Chart 2 shows the difficulty Obama has had in maintaining his approval ratings at levels comparable to those of the last four Presidents to enjoy re-election in the US.
Chart 2: Presidential approval
My view is not that Romney is more likely to win the Presidency - I don’t think he will. Obama’s approval ratings may be relatively low but they are significantly higher than those of Presidents Carter and Bush at this point in their unsuccessful re-election campaigns. He is also leading to varying degrees in states worth 332 electoral college votes (270 are needed to win). However, once one adjusts the current polls for the convention bounces and allows for the not inconsiderable likelihood of more disappointing economic news between now and the election, Romney’s task is not quite the Herculean labour that many seem to think.
Richard Mylles is a political analyst at Absolute Strategy Research, an independent consultancy based in London.
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23 comments
Billy Jeff just threw Obo under the bus...
Another Øbama "green" stimulus project gone bad:
Workers at the Compact Power manufacturing facilities in Holland, Mich., run by LG Chem, have been placed on rotating furloughs, working only 3 weeks per month based on lack of demand for lithium-ion cells.
The facility, which was opened in July 2010 with a groundbreaking attended by Obama, has yet to produce a single battery for the Chevrolet Volt, the troubled electric car from General Motors. The plant’s batteries also were intended to be used in Ford’s electric Focus. …
The 650,000-square-foot, $300 million facility was slated to produce 15,000 batteries per year, while creating hundreds of new jobs. But to date, only 200 workers are employed at the plant by by the South Korean company. Batteries for the Chevy Volts that have been produced have been made by an LG plant in South Korea.
The factory was partly funded by a $150 million grant from the U.S. Department of Energy. LG also received sizeable tax breaks from the local government, saving nearly $50 million in property taxes over 15 years and another $2.5 million annually in business taxes. Landing the factory was hailed as a coup when shovels first hit the ground.
4 weeks left baby! from Hotair.com
We're used to there being a moron in the Whitehouse - George W.
But I'm not sure the US is ready for a mormon. This is the issue neither side is willing to discuss - but it will be key in keeping otherwise dyed in the wool republicans from voting for Romney. They say it's a religion - but we all know it's a cult.
I'm not sure it will figure in the swing states so much - Romney will lose there based on other factors.
Top Five Worst Obamacare Taxes Coming in 2013, 90 days from now: Jan 1, 2013:
The Obamacare Medical Device Tax – a $20 billion tax increase: Medical device manufacturers employ 409,000 people in 12,000 plants across the country. Obamacare imposes a new 2.3 percent excise tax on gross sales – even if the company does not earn a profit in a given year. In addition to killing small business jobs and impacting research and development budgets, this will increase the cost of your health care – making everything from pacemakers to prosthetics more expensive.
The Obamacare “Special Needs Kids Tax” – a $13 billion tax increase: The 30-35 million Americans who use a Flexible Spending Account (FSA) at work to pay for their family’s basic medical needs will face a new government cap of $2,500 (currently the accounts are unlimited under federal law, though employers are allowed to set a cap).
There is one group of FSA owners for whom this new cap will be particularly cruel and onerous: parents of special needs children. There are several million families with special needs children in the United States, and many of them use FSAs to pay for special needs education. Tuition rates at one leading school that teaches special needs children in Washington, D.C. (National Child Research Center) can easily exceed $14,000 per year. Under tax rules, FSA dollars can be used to pay for this type of special needs education. This Obamacare tax provision will limit the options available to these families.
The Obamacare Surtax on Investment Income – a $123 billion tax increase: This is a new, 3.8 percentage point surtax on investment income earned in households making at least $250,000 ($200,000 single). This would result in the following top tax rates on investment income:
The Obamacare “Haircut” for Medical Itemized Deductions – a $15.2 billion tax increase: Currently, those Americans facing high medical expenses are allowed a deduction to the extent that those expenses exceed 7.5 percent of adjusted gross income (AGI). This tax increase imposes a threshold of 10 percent of AGI. By limiting this deduction, Obamacare widens the net of taxable income for the sickest Americans. This tax provision will most harm near retirees and those with modest incomes but high medical bills.
The Obamacare Medicare Payroll Tax Hike -- an $86.8 billion tax increase: The Medicare payroll tax is currently 2.9 percent on all wages and self-employment profits. Under this tax hike, wages and profits exceeding $200,000 ($250,000 in the case of married couples) will face a 3.8 percent rate instead. This is a direct marginal income tax hike on small business owners, who are liable for self-employment tax in most cases.
This turd is toast...
The Jews caused America to be embroiled in WW2 when they bombed Pearl Harbour pretending to be Japanese.
The Jews caused America to be embroiled in WW2 when they bombed Pearl Harbour pretending to be Japanese.
If Romney wins bye bye islamofascist Iran and apartheid Pakistan.
Your comment makes me hope Romney wins.
really? a no-mark like Frederick actually influences how you think?
he just makes me laugh with all that fightin' talk. the problem for him is that when Romney was asked to explain exactly what he would do, he provided meanigless drivel;
(Obama on 60 Minutes)
President Obama said "If Governor Romney is suggesting we should start another war, he should say so."
Romney's response to that was a lot of weird, ranty, unintelligible word salad. Asked about it on the campaign plane, Romney said "I'm not going to try to fool people into thinking he believes things he doesn't. He's trying to fool people into thinking that I think things that I don't."
Romney is a clueless buffoon.
Ha, ha..Obamster indicted himself with his UN speech this week over his spring inaction over Egypt and Iran . Not. A. Clue. Jimmah is dancing...
surely even you aren't thick enough to believe this...
but just in case you are that idiotic, care to explain how Romney would fulfil your wet dream?
It seems to me Obama can still lose the election, but only if he drops his pants, squats down to take a dump and has an operation for a gender change-- and all this while on stage before the tv cameras during the debate with...eh, who's that clown again?
I think I saw some gender change @ DNC, or maybe it was Maude?.. & Barry's already taken the dump on all of us...
Why will millions vote for Obama? Some reasons:
They're desperate. Despite unemployment of 24% (not the "official govt. rate), taking away many civil rights and not prosecuting people for everything from fraud to torture, they'll do it anyway. Why? Because there's "no other choice".
Wrong. Jill Stein and the Green Party are on the ballot in all 50 states.
The're not a "viable party".
Oh really? Then why do so many other countries have multi-party systems?
You're obligated to vote for Obama ONLY BECAUSE you belong to a certain group (African American, Hispanic, etc.). I disagree.
Obama has said that his Administration won't prosecute former govt. leaders for any "alleged" war crimes committed during their term. Bush, Cheney and all the rest of them will get rich and never be touched.
Does this bother anyone? Apparently not.
I'll happily give away my civil rights and the right to have a decent life (single payer health care, free post secondary education, etc.) that other countries continue to have to re-elect Obama.
What does THAT say about the state of the States?
Again, with the racist thing....not sure why the left continues to pound away at demographic separation? Most euros aren't aware that the great US experiment has to do with economics & freedom- always has been. Once you realize that, this election choice all comes into view. Classic keynesian/redistribution/big govt philosophy vs free market/private enterprise/limited gvt/indiv freedom views. Too many informational outlets now to keep the story under wraps. Barry Obama the part-time celebrity mystery Prez vs strong successful businessman/Governor/charitable, conservative family man. Occupy-poopers & Chicago politic-cronies, look out!
Obama/Bernanke is edging the US up to the inflationary financial cliff with open-ended QE3 & massive tax hikes slated for Jan 1, 2013. Add the real Unemployment rates, Obamacare/Obamatax kicking in & more business regulations and you have the perfect storm... not sure if we can avoid a 2nd recession at this point. I've got to hand it to Obama, he wanted big government & he has done everything in his power to reach that. It's just that he's trashed the country...biggest election in 50 years!
As I have said elsewhere - this will be a close one come what may. It is hard to see the republican 'dream team' of Romney-Ryan clawing their way back from their recent self inflicted blows.
But there is still time for something bad to happen on the Obama side too. The economy is not good. Now everyone (including Mitt&Paul) know it's not Obama's fault and if he has failed to repair the damage done by decades of Republican misrule it is in large measure because republicans have blocked every attempt to do so.
The fear (hope foe Romney) is people will vote out of desparation - a panic move.
A lot depends on the court battles over voter ID laws and limited polling hours to keep blacks and poor from voting. They are pushing this hard and will fight dirtier as they get more desparate. It's shameful, but that is who they are.
Remember Americans - Mitt wonders why a dollar in your wallet is not in his. He wonders why a job in your town is not in China. He wonders why you don't want to work for $9 an hour. He wonders why you want healthcare, pensions and decent schools. He wonders who busses are for. He wonders why poor people don't borrow money from their parents and start a business....
I wonder how it can still be in doubt. But it is.
"I wonder how it can still be in doubt. But it is."
it is quite amazing isn't it, the average American still appears deluded enough to think the GOP stands for their interests. the reason is either they are just too dumb to realise they are directly in the firing line, or they are certain that somehow they will dodge the bullet of economic hardship if only Obama is removed.
oh, nearly forgot, the fact that Obama is black will continue to cost him substantial numbers of votes. as Romney noted recently the Latinos and Blacks will lean towards the Democratic party by default, which he feels is a genuine threat the United States. the man's a racist, fact. according to him a true American is non-Latino, non-Black.
People are reluctant to bring this up - but I'd say 20% of Romney's support would never vote for a Black or Latino (or Jewish) candidate. However - they would never vote democrat anyway - so it's a moot point.
In the recent past the US electorate has chosen two real air-heads in Reagan and Junior Bush so anything can happen. And what's more having found them out the US voter elected these meatheads for another presidential term.
No, you can't blame these two virtual warriors for playing the electorate for suckers that's par for the political course.
Mitt Romney looks a lot like one of the Brown Bomber's Bum of the Month club. And to make matters worse the Tea Party has donated a 'china' chin to this up-tight, sorry up-right, Republican candidate. Some joker has suggested the Osmond Family come out for Mitt but they're history and Romney will do everything to stay out of that dustbin
"funny to see just how many Americans down on their knees praying for an economic disaster just to get themselves back in charge". Knucklehead, it's already here...
GM disastrous bailout, QE1, 2 and now 3, two debt credit downgrades, no off-shore drilling or Keystone pipeline, sending $ Billions to Brazil for off-shore drilling, he had a 2 yr window with both house to fix the recession & he went for the unpopular Obamacare/tax & jammed it- around congress. He is still insistent on raising taxes on middle class when it's proven over & over that lowering tax rates increases tax revenue..
Oblama said he should be fired if he can't do the job after 3 years....we are happy to oblige...
funny to see just how many Americans down on their knees praying for an economic disaster just to get themselves back in charge. the GOP will merrily screw their fellow citizens to achieve this end. the Republican led congress blocked The American Jobs Act that would have added around 2 million jobs. the Act contained many elements demanded by Republicans, it was a bipartisan piece of legislation. not that this make the slightest difference, Obama must fail, no matter how many Americans are forced to suffer.
as Senate GOP leader Mitch McConnell said back in 2010, “The single most important thing we want to achieve is for President Obama to be a one-term president.”
what a patriot eh? burn the place down just to get rid of Obama...
Again, late to the party with the economy meme.. conservatives have know this for 3 years...Keynesian economics doesn't work. Either candidate, when elected, will suffer the Bernanke devalue of our dollar & artificially low interest rates (QE 3), which is planned to be "ongoing" at $40 billion per month (magic money out of thin air). Pity the Senior savers whose 1970's & 80's dollars are going to be so watered down... it's stealing!