Aug. 22, 2024

Permission to republish original opeds and cartoons granted.

Even if there is a recession, first-term incumbent parties still win 50 percent of the time in modern history with downturns beginning during term

By Robert Romano

The Federal Reserve released the minutes of its most recent minutes of its July 30 and July 31 meeting it is ready to begin cutting interest rates to deal with rising unemployment, with the central bank reporting, “The staff’s outlook for growth in the second half of 2024 had been marked down largely in response to weaker-than-expected labor market indicators.”

The opening is being created by inflation expectations easing: “The staff's inflation forecast was slightly lower than the one prepared for the previous meeting, reflecting incoming data and the lower projected level of resource utilization. Both total and core PCE price inflation were expected to decline further as demand and supply in product and labor markets continued to move into better balance; by 2026, total and core inflation were expected to be around 2 percent.”

As a result, “Policy expectations, however measured, pointed to a first rate cut at the September FOMC meeting, at least one more cut later in the year, and further policy easing next year.”

Which is what the central bank usually does as inflation eases and unemployment rises, which it has, by 1.47 million since Dec. 2022. In the entire post-World War II era, every single Fed interest rate cut cycle coincided with a recession. Sometimes, the recession would already be happening, like in 1957, 1970, 1974, 1980 and 1981 recessions, and other times, the rate cuts began ahead of the recessions of 1960 (which carried over into 1961), 1990, 2001, 2008 (which carried over into 2009) and 2020.

But, rest assured, they all wind up in the same place. When unemployment peaks, the Fed stops cutting rates and the cycle begins anew. At this point, we’re still at the peak interest rate part of the cycle that precedes recessions. Other recession signals, besides the rising unemployment, include the inversion of the spread between 10-year and 2-year treasuries.

Now, all of that is usually troubling news for incumbent administrations, with recessions having occurred in terms of the incumbent parties, including Herbert Hoover losing in 1932, Vice President Richard Nixon losing in 1960, Gerald Ford losing in 1976, Jimmy Carter losing in 1980, George H.W. Bush losing in 1992 and Donald Trump losing in 2020. 

Sometimes, the incumbents win another term in spite of recessions during their terms, including Lyndon Johnson in 1964, Richard Nixon in 1972, Ronald Reagan in 1984, George W. Bush in 2004 and Barack Obama in 2012. 

So, overall, when there’s a recession the incumbents have lost 54 percent of the time. If one wishes to remove 1964 and 2012 from that, owing to the recessions beginning before John Kennedy and Lyndon Johnson’s and Obama’s terms of office, respectively, then that’s six losses to three wins, and the incumbents lost 67 percent of the time. 

But some of those losses — Hoover in 1932, Nixon in 1960 and Ford in 1976 — came after the incumbent party had already been in power for two or more terms, when statistically the probability of winning another four years for the ruling party drops markedly regardless of economic conditions. 

Leaving only first term administrations with recessions that began while in office, then, the losing years include 1976, 1980 and 2020. And the winning years remain 1972, 1984 and 2004. Three wins, three losses.

So, for first-term incumbents in modern history with recessions that began after taking office, they won another term 50 percent of the time, and lost 50 percent of the time. Otherwise, incumbent parties in their first terms win re-election 66.6 percent of the time and lose 33.3 percent of the time over U.S. history.

For former President Donald Trump — who was one of those first-term presidential economic victims — that could potentially be good news in his bid against Vice President Kamala Harris. 

Mostly because most Americans think we’ve been in a recession for some time now. In May, Harris did a poll for the Guardian that showed 55 percent of voters think we’re already in a recession, including 67 percent of Republicans, 53 percent of independents and 49 percent of Democrats. 

That was way up from May 2023 when Harris asked the same question, when 37 percent said the U.S. was in a recession and another 42 percent said we would be so in the next year. Only 21 percent though a recession would be avoided. That could make 2024 a toss-up.

Meaning, voter attitudes are already economic pessimistic. That could hurt Harris in November, who will have to choose between attempting to persuade most Americans that there is no recession and that the economy is strong, or acknowledging the current weakness, which includes inflation outpacing personal incomes since Biden and Harris took office. Or maybe even worse, saying nothing about the problem, hoping it all goes away and taking her chances at the polls in November. Stay tuned.

Robert Romano is the Vice President of Public Policy at Americans for Limited Government Foundation. 

To view online: https://dailytorch.com/2024/08/even-if-there-is-a-recession-first-term-incumbent-parties-still-win-50-percent-of-the-time-in-modern-history-with-downturns-beginning-during-term/ 

Will Harris Actually Win That Many White Voters And Why Is She Losing Working Class Minorities? 

By Bill Wilson

A slew of new polls are being trumpeted by the mainstream as vindication for Vice President Kamala Harris – she is now neck and neck with former President Donald Trump in battleground states, where a month ago President Joe Biden was trailing him. 

Harris is being touted by the mainstream as a woman of color who will look out for the underdog, but most polling shows Harris is only popular among the entrenched elite and is struggling to gain traction among working-class voters – especially minorities. 

According to the polls, Harris has little issue matching or exceeding Biden’s numbers with educated voters, including whites. The latest New York Times/Siena College poll shows Harris earning 56 percent of Americans with a college degree, a point more than Biden won in 2020. Among whites with a college degree Harris is earning 51 percent of the vote, the same share that Biden did. 

The polls indicate that Harris may be able to earn around 42 percent of the white vote overall, but this could be a stretch. The first Black president, Barack Obama – who was also a man, and whose mother was white – won 39 percent of the white vote against Mitt Romney in 2012.  

Obama claimed to be focused on the economy and attempted to portray himself as a populist fighting the Big Bad Insurance Companies to pass “Obamacare” – which turned out to be a disaster – but he made economic issues a central piece to the campaign. Harris is not. She is running as a far-left DEI Open Borders extremist, and she picked one of the most radical governors in the country as her running mate, a man whose response to rioting is watching his city go up in flames. 

It is a bit of a stretch to assume that a larger share of the population, which includes a swathe of independents and moderates, would favor Harris and her social justice agenda over Obama’s purported attempt to address economic inequality in 2012. Nevertheless, if left-wing women largely vote and men largely don’t, Harris may indeed collect a sizeable share of the white vote.  

Where the data gets interesting is in Harris’ trailing numbers among middle-class and working-class minorities. 

A brand-new Times Siena poll of three racially and economically diverse swing states – Arizona, Georgia, and Nevada – shows Harris running away with the election among so-called ‘privileged’ classes, but widely underperforming Biden among the ‘less privileged’.     

In Arizona, Harris is polling five points below where Biden was with Latinos in 2020, earning 56 percent of their vote to Biden’s 61 percent. However, among non-college educated minorities, her numbers are even worse. Harris is down eight points from where Biden was with non-college minorities in Arizona, earning a slim 52 percent of their vote while Biden won 60 percent. 

In Nevada, Trump is up nine points with Hispanics compared to his share of the vote in 2020, going from 35 percent in 2020 to 44 percent now. Harris is netting 45 percent of the Hispanic vote – beating Trump by a single percentage point. This leaves Harris underperforming Biden’s 2020 numbers by a full 16 points, considering Biden won 61 percent of Latinos four years ago. 

How about the non-college vote in Nevada? According to the Times poll, Harris is underperforming Biden by 14 points among minorities without a college degree, while Trump has gained eight points compared to 2020. Harris is netting a meager 48 percent of the non-college minority vote in Nevada, while Biden walked away with 62 percent of the vote. Trump has gone from just 34 percent of the non-college minority vote to 42 percent, placing him just six points below Harris. This is quite the climb for Trump, who lost non-college minorities to Biden by 28 points in 2020, 62 percent to 34 percent.    

Then there is Georgia. Trump is up nearly double the amount he was in 2020 among Black voters – going from 11 percent of their vote to 20 percent in the latest poll. For her part, Harris is underperforming Biden by 15 points among Blacks, earning just 73 percent of the vote to Biden’s 88 percent.  

Here too, Harris is widely underperforming among minorities without a college education while Trump has rapidly gained support among this group. Trump is up 17 points with non-college minorities compared to 2020, going from 19 percent of their vote to 36 percent today. Harris is underperforming Biden’s numbers by a startling 21 points among non-college minorities, earning just 59 percent of their vote to Biden’s 80 percent.  

Polling from last week showed a similar underperformance among working-class minorities for Harris in three Midwestern battleground states – Michigan, Pennsylvania, and Wisconsin. The poll, also from the Times, showed Trump up against Harris with Black voters compared to where he was against Biden in 2020, and doubling his share of the Black vote in two states.    

What is this story telling us? Americans who are struggling, who have been beaten down by the Biden economy, crushing inflation, rampant crime and relentless illegal immigration are not behind the Harris-Walz ticket. 

Working-class voters are increasingly disenchanted with Harris, and the bulk of her support stems from virtue-signaling ivory tower elites. Whether Harris will even earn the share of the white vote she is receiving in polls remains to be seen. Again, given all current metrics including the strain on the economy and the border, do we believe Harris is a more marketable candidate than Obama was in 2012? 

Regardless of if Harris can attract a sizeable share of the white vote, her significant deficits among minorities – including the least educated – should raise some eyebrows. Whether these voters shift to supporting Trump is open ended, as lower-educated groups are less likely to participate in elections in general. It is possible disenchanted working-class voters will simply sit out the election. Long-term, Democrats cannot afford to build a party without the support of the middle-class, and yet their destructive policies are driving away most of them.     

Bill Wilson is the former president of Americans for Limited Government. 

To view online: https://dailytorch.com/2024/08/will-harris-actually-win-that-many-white-voters-and-why-is-she-losing-working-class-minorities/