Tuesday, April 2, 2024

BTRTN: A Deep Look at the Presidential Race

Tom with the March 2024 BTRTN Month in Review, which serves as an update on the presidential election.

MARCH 2024

Twin tragedies around the globe – a horrific concert hall mass shooting in Moscow and a disastrous shipping accident in Baltimore – dominated the news cycle in the last half of March, pushing politics off the headlines.  Both events had political implications, of course, the terrorist attack revealing Putin weakness and Russian anger that belie his overwhelming (and fixed) election win in Moscow, and the shipping accident testing the Biden Administration’s crisis management acumen in Washington.  But with those two events, plus the resolution of a potential budget standoff and government shutdown, and the effective end of the presidential primary season, America took a slight breather from its traumatized politics.

That makes this a good time to take stock of the presidential election, which is now fully underway.  This is a virtually unprecedented early start to a race that, according to the American people, is among the least appealing of our lifetime, with nearly 70% of voters unhappy with a rematch of Joe Biden versus Donald Trump -- even as they ushered it in in near-record time.

There are three main takeaways from this article:

·        We are in the very early stages of the race, with more than six months to go before ballots begin to be cast, and much will happen that will influence those results

·        It is a closer race now than you probably think (Trump’s edge is quite small and has narrowed), and will almost certainly will be a very close race come November, hinging on get out the vote efforts

·        There is absolutely no cause to think that Joe Biden cannot win this race; of course he can

In this article we’ll review the current political environment, summarize and assess the current national and swing state polling, and discuss what lies ahead.


POLITICAL ENVIRONMENT

The political environment at this juncture almost certainly favors the Democrats.  The issues tilt in their favor, best demonstrated by their remarkable run of electoral success. The Democrats have won every election cycle since 2016, and 2023 was replete with resounding Democratic victories at the state level.

While Biden has clear vulnerabilities with respect to his age, immigration, the economy and Gaza, he has made considerable progress in the last month on the first three of them and appears to have begun to develop some electoral momentum.

Biden’s strong and vital performance in the State of the Union, and vigor on the campaign trail since, has tamped down concerns about his age and general competence.  The GOP surely miscalculated in setting the bar so low for his performance that just showing up and getting through the speech would have been a win.  An even worse mistake was baiting him from the floor, which merely set up stinging, off-the-cuff retorts by Biden, which he clearly enjoyed delivering.  While the performance did not move Biden’s approval rating, there was considerable polling evidence that Democrats now feel better about their candidate on the heels of the spot-on performance. 

The GOP gifted Biden a badly needed talking point on his most vulnerable issue, immigration, by bowing to Trump and refusing to pass their own hardline immigration bill developed in the Senate, which Biden and Senate Democrats embraced.  Biden can now say that the GOP failed to act to secure the border and failed to do so at Trump’s behest.  This message not only fills, at least in part, his messaging gap on immigration, but also underlines twin campaign themes of GOP dysfunction and Trump putting himself before the nation.

The drumbeat of a strong economy continues, as the Dow has surged to record levels and is nearing the momentous 40,000 mark.  Unemployment remains at exceedingly low levels, consumer spending is positively giddy and wage increases are outstripping inflation, which has settled down to 2-3%.  The Fed has signaled three interest rate cuts in 2024 which should lead to lower mortgage and auto rates.  Consumer confidence is on the rise and, while Biden is not getting any credit for the economy, it is clearly losing steam as a GOP campaign issue, even though the price of a gallon of gas and a gallon of milk are higher than in the Trump years – facts that will not change now or perhaps ever.

Gaza remains the one issue for which Biden has, as yet, no answer.  Ironically, though, that does not make it a strong issue for the GOP; if anything, voters who are passionate on the issue understand that Trump would likely have embraced Netanyahu and Israel even more tightly than Biden.  Gaza is more of a wedge issue within the Democratic Party, which has resulted in protest votes in the primaries and a defection of potential support from Biden among young voters and Arab-American voters.  The latter forms a material voting bloc in the key swing state of Michigan.  Biden recognizes his vulnerability and has clearly broken with Netanyahu publicly over the IDF’s plan to, at some undetermined point, invade Rafah.  But he is still clearly reluctant to take the type of actions – such as putting restrictions on arms aid -- that would back up the tough words, and thus both the policy and messaging remain problematic.

But against those issues on which Biden shows vulnerability are a raft that favor the Democrats.  First and foremost, the Democrats have a clear election winner with respect to abortion, which in the post-Dobbs era has been the political gift that keeps on giving and rises above all others in terms of driving electoral success.  The GOP’s inability to develop a coherent policy, while states and judges zealously plunge ahead with abortion bans, has left GOP candidates grasping at straws in election after election. 

Biden is also advantaged by Trump’s ongoing trials (and tribulations), his extremely dark and violent statements about the state of the country, the way he intends to govern if elected, and the threat to democracy that he poses.  Biden is also helped by the Trump-influenced farce that is the GOP House of Representatives, with their sham (and unpopular) impeachments and proven inability to govern (shutdown avoidance notwithstanding).  The Democrats are also aligned with the majority of the country on important issues such as support for Ukraine, climate change and gun control.  Trump’s unwillingness to woo the Haley voters of his own party, not to mention independents, is a weakness borne of his addiction to the frenzied love of the MAGA crowd, to whom he directs most of his messaging.  (Biden has reached out to Haley voters more than Trump, and Haley herself has refused to endorse Trump.)

Biden’s approval rating remains stuck at roughly 40%.  Every president since Truman who won reelection had an approval rating of 48% or higher by Election Day.  The three losers – Carter, Bush 41 and Trump – were at 43% or lower.  Three presidents – Reagan, Clinton and Obama – raised their approval ratings from the low- to mid-40 percent range to over 50% in the year before their reelection, so there is precedent for a significant move.  More to the point, because of Trump’s own substantial unpopularity, Biden does not need to get to 48% to win.  It is a very close election right now, even as he sits at 40%.  But a few points would help, and that is within reach.  His approval rating was 43% a year ago, and has been as high as 57% in his presidency, which suggests there are many voters who once favored Biden, and some may be open to backing him if he continues to champion popular policies, avoids major missteps and presides over a surging economy.

But the best evidence of a favorable electoral environment for Biden and the Democrats has been their run of electoral success.  The Democrats rebounded from the 2016 debacle by winning back the House in 2018, the White House and Senate in 2020, and dramatically overperformed historical expectations in the 2022 midterms, holding the Senate and almost keeping the House.  There were also six abortion-related referendums on state ballots in 2022, all won handily by the pro-choice side.  And in 2023 and early 2024 the streak has continued with excellent performance in a number of state elections and referendums, including:

·        A Democratic judge won a crucial state supreme court election, by a solid margin (D+11), in swing state Wisconsin

·        An abortion rights amendment to red state Ohio’s constitution was overwhelmingly approved by a stunning margin (D+14)

·        Control of the Virginia legislature (both the state Senate and House of Delegates) flipped to the Democrats

·        A Democratic governor won reelection in Kentucky and a Democrat almost won a gubernatorial election deep-red Mississippi

·        The Democrats flipped New York’s 3rd Congressional district in a special election in early 2024

·        In Alabama last month, a Democrat flipped a State House seat by a stunning +25 points – a seat she had lost by 7 points in 2022 – in a special election, running on the abortion issue and highlighting the state’s high court ruling that frozen embryos are children (which at least temporarily resulted in a very unpopular virtual ban on in vitro fertilization in the state)

·        These last two special election results continued the 2023 trend of 30 special elections (elections for state legislature seats that became vacant due to death or resignation) in which Democrats outperformed 2020 or 2022 election norms by +11 percentage points on average.


NATIONAL AND SWING STATE POLLS

While Trump is ahead in both national and swing state polls, the race is close and, in the last month, appears to have narrowed just a bit.  I have been noting that at some point you will, almost inevitably, start to see articles touting a “Biden Comeback” and, right on cue, on the basis of recent Bloomberg polls, those articles have indeed arrived (Axios AM’s “Biden Comeback Signs” on March 26, for one).

In national polling averages (per the chart below), the race has bounced back and forth over the past 15 months, with Trump opening up his lead to roughly +2 points more or less at the time the Gaza backlash began in November 2023.  That lead has narrowed to +1.4 in March.  (RealClearPolitics, which uses a slightly different polling average algorithm than BTRTN, has the margin even tighter at +1.0.)





A few caveats are in order.  Because of the inherent GOP bias in the Electoral College, Biden would need to be at least two points ahead in national polls for the race to be considered even.  Also, this polling excludes third party candidates, who at this juncture seem to be hurting Biden slightly more than Trump.   However, I tend to discount those candidates – for now -- because they appear to be more of a repository for disaffected voters and unknown quantities otherwise, and some may not even get on certain swing state ballots.  Better to wait until the fall to assess their true impact, when they are better understood as candidates in their own right (and the Biden campaign has a full team devoted to properly defining RFK, Jr.).

But, of course, national polls don’t really matter.  What matters are swing state polls, where the race will be decided.  At this juncture (and subject to change) we see seven swing states:  Arizona and Nevada out west, Georgia and North Carolina in the south, and the northern industrial trio of Michigan, Pennsylvania and Wisconsin.  These seven states were all decided by less than three points in 2020, and Biden took six of them, three of them by less than a point.

Here is the polling, as we see it, in early 2024. 










While Trump is ahead in all seven states, the margin is nearly negligible in Pennsylvania and Wisconsin and also quite small in Michigan and Nevada, all states Biden won in 2020.  The race is within reach in the other three states and has tightened of late in Georgia and North Carolina.

Let’s do a little Electoral College math.  If we concede to Biden and Trump all of their “solid” and “likely” states – such as California and New York for Biden, and Florida and Texas for Trump – the two each have over 200 electoral votes “in the bag” – 226 for Biden, 219 for Trump.  If Biden can take those three industrial states that are so close now – Pennsylvania, Wisconsin and Michigan – their 44 electoral votes would give him 270, enough for a victory.  That is as close as it gets, but, as of now, that is Biden’s best path to victory, and certainly achievable.


WHAT LIES AHEAD

But it would be wise not to get too carried away with either the polls or the math with the election half-a-year away.  It is so early – at this point, we are usually still in the throes of the primary season, with at least a few candidates still contending for delegates, and the ultimate delegate count goal for the frontrunners still ahead of them.  We don’t start paying attention to the general election until at least June, when presumptive nominees emerge at the end of the primary process, and most voters not until after Labor Day, if not just before heading to their voting venue.  We forget how little people pay attention to politics, certainly compared to a reader of this article, and how late many make their choices, even in these polarized times.  Difficult as it is to imagine, nearly 10% of the electorate is undecided, and the support of the candidates by some is relatively soft.

We also forget that candidates – and particularly sitting presidents – have the ability to address their vulnerabilities.  It was not simply good luck that propelled Reagan, Clinton and Obama to their improved approval rate standing in the year before their election – they worked on it.  Biden is now attempting to win over those unhappy with his Gaza policies, the union/labor vote, the Black vote, the Latino vote and the youth vote.  These traditional Democratic coalition voters may need some wooing and some of them may not come back, but Biden will do the work.  Infrastructure ribbons will be cut, student loans will be forgiven, policies supporting business entrepreneurship in inner cities will be trumpeted and money will flow to swing states.  Trump, on the other hand, as noted, is not a traditional politician and he simply spends too much of his time preaching to the MAGA choir and dissing the Haley voters, some of whom (though less than you think) were Trump voters in 2016 and 2020, and he will need again to win.

Estimates are that $16 billion will be spent on national political campaigns by Election Day, which is a sum greater than the GDP of 50 countries around the globe.  And that does not even consider the free media, the social media and all of the get out the vote efforts that will shape the election. 

And, of course, much will happen in the coming months.  There are a breathtaking number of potential “catalysts” that could move the electorate several points in one direction or the other, more than enough to swing the outcome.  Consider these:

        The direction of the Gaza War, which could range from escalating into a broader Middle East war to a lasting peace, with nearly infinite potential outcomes in between

        How the House manages the Biden impeachment, which has been a travesty thus far, as well as the resolution of funding for Ukraine, Israel and border security

        The movement of the economy, particularly if and when the Fed starts to cut interest rates

        The upcoming focus on the New York Trump “Hush Money” trial, the ongoing drama of the start dates of the other criminal trials, and the impact of the need for Trump to spend so much time in court at the expense of the campaign trail

        The upcoming Supreme Court rulings on Trump’s immunity case, which could very well be a unanimous anti-Trump verdict, and the mifepristone case, which, if the court sets limits on the medicated abortion drug, could pour gasoline on the abortion inferno, further motivating pro-choice voters to the polls

        The effects of Trump’s vice-presidential choice, the conventions and, if there are any, the debates

        The role of the spoilers, the third party candidates who will siphon votes from the major party candidates

        Potential changes in either candidate’s health – or the perception of those changes

Then, of course, there is Donald Rumsfeld’s famous formulation of the “unknown unknowns,” major events like George Floyd, the Ukraine War and the October 7th attacks that can upend political life, and presidential campaigns, any of which could occur on any given day between now and November.

Another consequential factor is Biden’s decided money advantage.  It could very well be that the most significant downside to Trump from the trials is not their outcome, nor their revelations, nor their impact on his time or reputation.  It could be all about the money.  Biden raised more than twice as much money as Trump in February ($21 versus $10 million) and ended the month with more than twice as much cash on hand ($71 versus $33 million).  The disparities are even wider in their respective fundraising committee, as Biden entities raised $53 million for a total of $155 million, compared to $20 million and $42 million, respectively, raised by Trump entities.  These outcomes reflect the cooling effect the Trump trials are having on Trump’s major donors, who are not excited about funding legal instead of campaign expenses.  Trump is barely staying above water on the monthly net, and, as has been shown, cannot infuse his own campaign with cash even if he was so inclined (which he did not do in 2020).

The money is only important if it is well spent, but such a gigantic disparity in working campaign dollars is rare in presidential races.  It certainly could meaningfully affect the strength of the respective candidate’s get out the vote ground game.  In this race, everything matters, since the margin is so thin.

It will likely all come down to that ground game, and those three key industrial heartland states.  I am not aware of any changes in vote-counting laws in Michigan, Pennsylvania and Wisconsin, so we could see a replay of 2020, watching for days on end as early votes are counted, looking to see if Biden secures enough of them to overtake the Election Day lead Trump will likely have.  While the Trump team is trying to reverse Trump dogma on badmouthing write-in voting, the candidate himself still disses it, reflexively. If there is bad weather on Election Day, that unforced error could haunt Trump – and result not only in a loss, but jail time.

Remember, it’s early.  Biden has time to overcome what is a small polling deficit, and seems to be making progress.

Stay tuned.


KEY METRICS

Joe Biden’s approval rating in March remained at 40%, and his net negative remained at -16 percentage points.  His issue ratings were also relatively unchanged.

The generic ballot continues to be a dead heat between the Democrats and the GOP.

The "Bidenometer" dropped slightly from +49 to +47, driven by an increase in the price of gas.  But the +49 level means the economy is in far better shape under Biden than the one he inherited from Trump (see below).

















BIDENOMETER

The Bidenometer is a BTRTN proprietary economic measure that was designed to provide an objective answer to the legendary economically-driven question at the heart of the 1980 Reagan campaign:  “Are you better off than you were four years ago?”  We reset the Bidenometer at this Inaugural to zero, so that we better demonstrate whether the economy performs better (a positive number) or worse (a negative number) under Biden than what he inherited from the Trump Administration.

The Bidenometer measure is comprised of five indicative data points:  the unemployment rate, Consumer Confidence, the price of gasoline, the Dow-Jones Industrial Average and the U.S. GDP.  The measure is calculated by averaging the percentage change in each measure from the inaugural to the present time.

The +47 for March 2024 means that, on average, the five measures are 47% higher than they were when Biden was inaugurated (see the chart below).  With a Bidenometer of +47, the economy is performing markedly better under Biden compared to its condition when Trump left office.  Unemployment is much lower, consumer confidence is higher, the Dow is much higher, the GDP is MUCH higher.  Only the price of gas is higher, which is a proxy for general inflation.

Using January 20, 2021 as a baseline measure of zero, under Clinton the measure ended at +55.  It declined from +55 to +8 under Bush, who presided over the Great Recession at the end of his term, then rose from +8 to +33 under Obama’s recovery.  Under Trump, it fell again, from +33 to 0, driven by the shock of COVID-19 and Trump’s mismanagement of it.  Now we have seen it move upward from 0 to +47 under Biden.

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