Well, we can all stop thinking about the presidential election, because Barack Obama's victory is assured. This morning, Paul Wiseman at the Associated Press, aka the Administration's Press, virtually celebrated analysts' predictions that the unemployment rate will drop a whole 0.3% between now and Election Day to 7.9%. But in searching desperately for a precedent, he claimed that a public which has historically tended to have a "What have you done for me lately?" mentality has rewarded presidents seeking reelection who have seen the jobless rate decline in "the two years before the election." By this "logic," Obama will be reelected even if the unemployment rate zooms to 9.7% by Election Day, because that rate will still be lower than November 2010 rate of 9.8%. So, as I said, it's over.
What follows in rebuttal isn't a claim that Obama won't get reelected. But if he does, it will be certainly be for reasons other than the economy's (brace yourself) "brighter jobs picture" and its move into a "virtuous cycle." Excerpts from Wiseman's wheezing follow the jump (bold is mine; HT to BizzyBlog commenter "Tony"):
AP survey: Steady job gains to sustain US recover
Hiring through the rest of 2012 will lag the brisk pace set early this year. But it will be strong enough to push the unemployment rate below 8 percent by Election Day.
That's the view that emerges from an Associated Press survey of 32 leading economists who foresee a gradually brighter jobs picture. Despite higher gas prices, Europe's debt crisis and a weak housing market, they think the economy has entered a "virtuous cycle" in which hiring boosts consumer spending, which fuels more hiring and spending.
... the economists think the recovery will manage to reduce unemployment to 7.9 percent by Election Day from 8.2 percent in March.
Falling unemployment would boost President Barack Obama's prospects in November. Going back to 1956, no president has lost re-election when the unemployment rate dropped in the two years before the election. And none has won when the rate rose over that time.
Unemployment was 9.8 in November 2010. If the surveyed economists prove correct, the rate will be nearly 2 percentage points lower when Americans vote on Nov. 6.
Yet the AP economists think it will be at least three more years before unemployment falls below 6 percent, which would be a sign of a healthy economy.
They predict the economy will grow 2.5 percent this year, up from 1.7 percent in 2011. In a healthy economy, 2.5 percent annual growth is usually adequate. Not so when 12.7 million people are unemployed. The economy would have to grow about 4 percent for a year to lower unemployment another percentage point.
The economists expect job growth to average 177,000 a month from April through June and 189,000 in the second half of the year. That would be down from an average 212,000 jobs added monthly from January through March. Last year, job growth averaged 158,000 a month.
"The job market is improving enough that consumer spending can grow at a moderate pace as opposed to an anemic pace," says Phillip Swagel, a University of Maryland economist. "Businesses are finally confident enough to hire and invest."
One of many obvious flaws in Wiseman's "logic" is that voters don't know November's reported unemployment rate when they vote on Election Day. They definitely have known September's rate, and sometimes know October's, depending on whether Election Day precedes the Labor Department's October employment report, which is typically published on the first Friday in November. But we'll work with his "analysis" anyway.
Here are the unemployment rates associated with each incumbent presidential election effort since 1956, with rates two years before Election Day and on Election Day in parens (incumbents LBJ and Ford are listed even though they were seeking election and not reelection):
- 1956 -- Eisenhower (5.3; 4.3; won)
- 1964 -- LBJ (5.7; 4.8; won)
- 1972 -- Nixon (5.9; 5.3; won)
- 1976 -- Ford (6.6; 7.8; lost)
- 1980 -- Carter (5.9; 7.5; lost)
- 1984 -- Reagan (10.8 ; 7.2; won)
- 1992 -- Bush 41 (6.2; 7.4; lost)
- 1996 -- Clinton (5.6; 5.4; won)
- 2004 -- Bush 43 (5.9; 5.4; won)
- 2012 -- Obama (9.8; predicted 7.9; pending)
With the detail present, one sees that Wiseman's association of a falling unemployment rate -- over two years! -- with the election or reelection of an incumbent has worked five times (1956, 1964, 1972, 1984, 1996, 2004). The absurdly obvious point to make is that in only one instance was the Election Day unemployment rate anywhere near this year's predicted 7.9%. That was in 1984, when the economy under Ronald was in the midst of a year of 7% economic growth which brought the unemployment rate down by one-third while adding over 300,000 seasonally adjusted jobs per month from April through October in an economy with a far smaller workforce.
This year, we'll be extremely lucky to see growth of 3%, while the predicted (and in my opinion, overoptimistic) 177,000 jobs added per month will, on a population-adjusted basis, be less than half that seen in during 1984's analogous months under Reagan. And of course, Wiseman didn't cite many other unprecedented factors. To name just a few (and by no means all): the workforce drop-outs who have kept the current unemployment rate artificially low; the degree to which job pickups since the recession ended have until very recently been disproportionately part-time positions; the impending Taxmageddon arriving on January 1, 2013; the possibly still-looming impact of ObamaCare; and the massive debt build-up threatening the nation's solvency.
Wiseman didn't identify any significant countervailing factors until his seventh paragraph, knowing full well that many subscribing print and online outlets won't carry the later verbiage; that even if they do publish it, many readers won't get to it; and that virtually no broadcaster will get that far. What will endure for most is "Better days are here again, and things are looking up for Dear Leader" pap.
Cross-posted at BizzyBlog.com.