1. In October of 2012, the jobs report showed 114,000 jobs created and an unemployment rate of 7.8 percent. That was considered such good news for Obama’s reelection prospects that Jack Welch immediately accused the administration of cooking the books.
2. 25 months later, the jobs report showed 214,000 jobs and an unemployment rate of 5.8 percent. The economy’s been adding jobs at a pace of over 220,000 per month all year, and the current string continuous months of job growth is the longest on record.
3. This is good news for America. And a couple of years back, it would be have been considered great news for the Democratic Party.
4. Not only did Democrats get whacked on Tuesday night, but President Obama’s low approval ratings were the dominant factor.
5. Readers of wonky websites who spent 2012 bombarded with stories about the overwhelming importance of macroeconomic performance to presidential elections may find it surprising that a strengthening economy didn’t pull Democrats up.
6. Many journalists have posited that this is perhaps because GDP growth hasn’t really translated into a better economy for typical middle-class households. I myself wrote a pretty good draft of an article with the exact same argument. But this actually doesn’t explain very much. Whatever you can say about wage stagnation or inequality in 2014 was equally true in 2012 — in fact, it was truer then. Today’s economy may not be great, but it is both better and improving faster than the economy of 2012.
7. The lack of economic lift is not surprising to political scientists. As UCLA’s Lynn Vavreck wrote before the election “there is a strong relationship between the nation’s growth rate and presidential vote share, but no relationship between the nation’s growth rate and Senate (or House) seat loss in midterm years.”
8. But don’t let the political scientists off that easily. This is really weird! If the economy drives whether people vote to re-elect the president, and presidential approval drives midterm voting, then surely the economy should should drive midterm voting through the mechanism of presidential approval, right? But, no, it doesn’t. Instead, presidents have a well-established but rather mysterious tendency to become unpopular in their sixth year. Even more mysterious — the big exception to the 6 Year Itch was Bill Clinton, who got himself impeached!
9. No president is solely responsible for the fate of the economy. But the fact is that Obama deserves a large dose of credit on this front. Conservative critics who charged that his tax, health care, and regulatory policies would crush the economy were utterly wrong. Liberals who alleged that his failure to nationalize the financial services industry would doom us to “zombie banks” and a Japan-style lost decade were also wrong. Nobody’s perfect, and Team Obama made at least one big mistake, but they got many more things right than wrong.
10. America’s economy is now the envy of the world. Frustrating as the recovery has been, it’s been far better than what the EU or UK have endured. Even countries like Canada, Australia, and Sweden who weathered the Great Crash well now have higher unemployment rates than ours.
11. The conditions for future growth look good. Falling global commodity prices mean there’s little risk of inflation, and the US economy is less vulnerable to foreign oil shocks than it’s been in decades. Households are less indebted than they were before the recession, and their balance sheets keep improving. Health care cost growth appears contained. Banks are carrying more liquidity and less leverage than before the crisis. The American public is better-educated than ever.
12. None of these positive trends are entirely thanks to Obama, but his often-controversial policies have played a contributing role in all of them. Gallup has Obama’s job approval at 41 percent.
13. Life isn’t fair.
