I read fivethirtyeight quite frequently because I’m genuinely interested in quantifying the spin we hear about polls and the economy with charts and statistics.
One of the things Nate Silver (author of fivethirtyeight) suggested is that Obama is in a similar place to where Bush was in 2004 regarding the economy. So, I measured 2 economic indicators, the stock market and unemployment rates (and number of unemployed people), from January 20, 2009-June 8, 2012 and January 20th, 2001-June 8, 2004 in order to compare the two candidates.
So let’s take a look.
Firstly, the stock market:
It is clear that Obama is looking much better than Bush regarding the performance of the stock market. This would indicate that if Bush won re-election based on the performance of the stock market under his administration, Obama will do the same and then some.
Secondly, the unemployment rate:
This is more of a mixed picture. On one hand, unemployment actually rose more under Bush during this time period than under Obama. On the other hand, it was also considerably lower under Bush than under Obama.
Let’s look at that same chart with numbers of unemployed people instead of %, just because it feels a little different when we are talking millions of unemployed people:
I doubt that the electorate will reward Obama simply for having lost fewer jobs (600,000 vs 3,200,000) than Bush did in a similar period of time. There are 3.7 million more unemployed people today than there were 8 years ago. If Obama received the same number of votes in 2012 as Bush did in 2004, except that those 3.7 million unemployed people voted against him, then he would lose the popular vote by 700,000 votes. (That said if the election looks more like 2008, then Obama would still win by 5.8 million votes.)
In conclusion, if the stock market is more heavily weighed by the electorate than the unemployment rate, Obama is a shoo-in for re-election. If unemployment is a better indicator, Obama will have a much tougher election and has to hope his get out the vote effort performs like it is 2008, not like Bush's did in 2004 (or that he can convince voters that those 3.7 million jobs were lost because of Bush's handling of the economy and that Romney would run the country similarly).