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Prediction: No Win-Win for Either Party in November

Russ Stewart 31 July 2012 No Comment

For both the Republicans and Democrats, the outcome of the 2012 presidential election will be either a win-lose or a lose-win situation. There will be no win-win.

 

Whichever party wins the White House in 2012 will suffer electoral retribution in 2014, and lose the presidency in 2016. That’s because the economic, fiscal and international problems confronting America are so intractably insoluble that the president elected in 2012 is doomed to fail.

Throughout history, there have been so-called “realigning” elections. They occurs when the majority party so alienates the electorate that the opposition assumes longterm dominance. That occurred in 1800, 1832, 1860, 1896, 1932 and 1980. 2008 was not a realigning election; it was a reaction to and rejection of the George Bush presidency. Likewise for 2012: It will be a reaction to (and possible rejection of) the Barack Obama presidency.

The U.S. political environment is fluid, each party has a base of about 40 percent, and neither party posits plausible solutions for the nation’s ills. If the Republicans win in 2012, it will be because Bush’s “failed economic policies” were not sufficiently remedied by Obama’s “failed economic policies.” And if Mitt Romney wins and doesn’t solve the problem, he’ll be ousted in 2016.

Here, with the November election just 100 days away, are three possible scenarios:

* OBAMA WINS, REPUBLICAN HOUSE, DEMOCRATIC SENATE:

An absolute recipe for disaster, with total gridlock ensuing. Unlike Bill Clinton, who governed as a liberal during 1993-94, but then evolved into a “triangulating”centrist when the Republicans won Congress, Obama is devoid of evolutionary instincts. Whereas Clinton took a middle position between the left and the right, Obama governs as a liberal, and, in a second and final term, has no incentive to compromise or be bi-partisan. His legacy is to be the “Great Progressive President,” and he will perpetuate his “class warfare,” castigating the Republicans as pawns of “millionaires and billionaires,” offering more spending and borrowing initiatives, and blaming the Republican House for the country’s economic malaise.

The national debt is now $15.783 trillion. Last autumn it was $14.2 trillion. In 2008, it was $8 trillion. The annual interest is $1 trillion in an annual federal budget of $3.8 trillion. The national debt is now 74.2 percent of America’s gross domestic product (GDP), which is the value of all goods and services produced, and amounted to roughly $20.2 trillion in 2011.

Failing countries in Europe, such as Greece and Italy, have a national debt which exceeds their GDP.

In the first three years of Obama’s term, coming off the “Bush recession” of 2007-08, the GDP grew at an anemic 1.5 percent. In the first three years of Ronald Reagan’s presidency, coming off the “Carter recession” of 1978-81, the GDP exploded at a 9 percent growth rate. It takes an annual GDP growth rate of 4 percent to winnow unemployment to under 5 percent.

Reagan’s approach was to maintain government spending, while enacting tax cuts for businesses and individuals, paid for by borrowing. He presumed that individuals would spend more, causing businesses to expand and hire more, creating an optimistic environment, with the tax revenues generated more than enough to offset the debt hike. He was right. Employment rose from 99.1 million in 1980 to 108 million in 1983, and the recession was over.

Obama’s approach is to increase government spending, paid for by borrowing almost $7 trillion in three years. That money went for bank and auto industry bailouts, “stimulus” handouts to local governments to create permanent or temporary public-sector jobs, and the $1 trillion Obamacare health package, which the Supreme Court has ruled to be a tax, and which will impose a 3.8 percent “surcharge” on unearned income beginning in 2013. The jobs Obama created do not generate enough tax revenue to offset the cost of their creation. Employment rose from 140 million in 2008 to 142.4 million in 2011. The recession is not over.

Thus far, Romney has not articulated a “vision” as to how he will solve the economic crisis. Obama offers MOTS (more of the same). Until and unless Romney offers more specifics than “I can fix it,” Obama’s MOTS will be the only package on the table. If Obama wins, the national debt will be $20 trillion by 2016, which will be necessary, as Obama’s budget projection through 2022 is for $5.8 trillion in annual spending.

* OBAMA WINS, REPUBLICAN HOUSE AND SENATE: Now the demonization will explode. Would the re-elected Obama even consider working with the Republican congressional majorities to pare back spending, introduce some baby-step reforms to social security, Medicare and Medicaid, and limit debt? Of course not. As a lame-duck president, Obama would be in a perfect position to join in the making of painful budgetary decisions, insure that neither party suffers the brunt of voter anger, and rein in entitlement eligibility and spending. Will he do it? Of course not.

Republicans will be compelled to propose and enact some entitlement reforms, resist lifting the debt ceiling, and cut non-defense spending. And you can expect Obama to be front and center, with righteous indignation, accusing the Republicans of pushing seniors over the cliff. Obama’s every effort during 2013-14 will be to aid the Democrats in taking back Congress in 2014 – not governing in a manner designed to solve the country’s problems.

* ROMNEY WINS, REPUBLICAN HOUSE AND SENATE: Now the proverbial stuff will really hit the fan. By defeating Obama, Romney will have enraged vast numbers of minorities and liberals, all of whom will be ever so eager for Romney to fail. The Republicans will have a two-year window of opportunity (2013-14) to enact a budget and economic recovery program that will bear fruit by 2016. The public and media abuse will be intense. Dis-informatrion and mis-information will be epidemic. Paranoia about cut Medicare and social security benefits – to aid the “millionaires and billionaires” – will be rampant. The repeal of Obamacare will be job number one.

Leadership means making difficult longterm decisions, and accepting painful short-term disappointments. If Romney has guts, like Reagan and Margaret Thatcher, he will know that the Republicans will suffer in 2014, but that he (and they) will recover smartly by 2016 if his policies succeed. And that means spending caps and tax cuts. If Romney dissembles, produces MOTS, and simply perpetuates Obama’s “failed economic policies,” then he’ll be shown the door in 2016, and Hillary Clinton will be the next president.

So which of these scenarios is most plausible?

Dick Morris, Bill Clinton’s chief strategist and architect of “triangulation,” is convinced that Romney is a certain winner. In tracking polls over the past six months, Obama’s job approval has hovered in the 45-50 percent range, and he’s consistently leading Romney nationally by 5-6 points, but never cracks 50 percent. According to Morris, an incumbent president needs to be in the 53-55 percent approve/re-elect range to win. Other polls show 55-60 percent think the country is on the “wrong track,” and 55 percent-plus oppose Obamacare.

If over half the voters are either anti-Obama or non-Obama (undecided) now, three months from the election, then, argues Morris, there’s minimal likelihood that they will suddenly become pro-Obama. That’s why the president’s campaign has gone negative on Romney, casting aspersions on his business history. The November election is a referendum on Obama’s performance, not a “choice” between Obama and Romney. But Team Obama wants to persuade 4-6 percent of the undecided voters that Romney is an unacceptable choice.

Daily tracking polls, which are published at the RealClearPolitics website, show Obama with a 3-10 percent lead over Romney in all the key battleground states. According to RCP, Obama is assured of 179 electoral votes from 14 states (CA, NY, DC, IL, MA, RI, MD, HI, DE, VT, CN, ME, NJ and WA) and will likely get 52 more (MN, NM, OR, PA, WI), for a base of 231, 39 short of the 270 needed for victory. In 2008, Obama got 365 electoral votes.

Romney is ahead in and likely to win 23 states, with 191 electoral votes, or 79 short.

That leaves 9 “battleground” states, containing 116 electoral votes, where the outcome is a toss-up (and all of which were won by Obama in 2008):Ohio (18 electoral votes), Florida (29), Michigan (16), North Carolina (15), Virginia (13), Nevada (6), Colorado (8), Iowa (6) and New Hampshire (4).

To win, Romney needs to carry Florida, North Carolina, Virginia, New Hampshire and either Michigan or Ohio. To win, Obama needs to carryNevada, Colorado, Iowa, Virginia and either Michigan or Ohio.

An interesting point: Obama is ahead in tracking polls in every “battleground” state except North Carolina, and is tied with Romney in Virginia. But in no state does Obama’s polling exceed 50 percent (nor does Romney’s), and in every state the dismal economy looms as a deciding issue.

Weighing the possibilities, it is more plausible that current non-Obama (undecided) voters, who were pro-Obama in 2008, will swing to Romney, than it is that they will suddenly rekindle their old Obama fervor. My prediction: A Republican win-lose, and a Democratic lose-win.

**

Russ Stewart is a political analyst for the Chicago Daily Observer

 

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