Wall Street headlines are full of fears of a springtime stall for the already subpar economic recovery. And if that weren’t bad enough for Obama’s reelection chances, a spate of new polls show Mitt Romney’s economic-approval ratings are far outdistancing the president’s.
Even while the headline surveys basically show an Obama-Romney tossup, it will be very difficult for Obama to pull out a victory this fall. Traditionally, incumbents who poll below 50 percent are in trouble. And with Obama consistently in the mid-40s, he has a tough uphill climb ahead.
Of course, a subpar recovery has kept the president’s reelection hopes in doubt for some time. Former Bush economist Ed Lazear calls it the worst recovery in history. Okay. That may be a partisan shot. But actually, the data points bear this out.
At roughly 2.5 percent growth, the Obama recovery is way below the 4.5 percent average since World War II. And within Obama’s 2.5 percent economy, polling data show high voter anxiety over gas prices, home values, and the ability to pay mortgages. Voters even worry that they won’t be able to afford to send their kids to college.
The unemployment rate may have come down to 8.3 percent. But the problem for several years is that discouraged workers have been dropping out of the labor force. So real-world unemployment is considerably higher than the official stats.
And if all this weren’t bad enough for the president, recent economic numbers are going in the wrong direction: Initial jobless claims have increased about 6 percent. Existing homes sales and housing starts have fallen the last two months. Manufacturing, which has been a very positive story (assisted by rock-bottom natural-gas prices from the shale revolution), actually fell last month. And while retail sales continue to be a bright spot, incomes after inflation — including high gas and food prices — may not be keeping up.
Perhaps the most optimistic statistic is the Index of Leading Economic Indicators. This measure has increased six straight months and stands at its highest level in four years, a good sign that the 2.5 percent trendline growth rate will continue without a double dip. But it’s still only 2.5 percent growth.
No one can yet tell if any of the economic soft spots are reflected in the latest polls. But the economic headlines read badly. And overall disappointment on the economy is undoubtedly why former governor Mitt Romney has such a strong lead in economic approval.
A Wall Street Journal/NBC poll puts that lead at six points. Rasmussen has it at ten. And Quinnipiac has voter disapproval of Obama’s handling of the economy at a whopping 56 percent.
At this point in the election cycle, Romney is in stronger shape for November than almost anyone appreciates. He is consolidating political support from all sections of the Republican party. And while the economy is the biggest election-year issue, it’s also Romney’s greatest strength.
Whether independent voters yet understand all of Romney’s free-enterprise, merit-based, limited-government, tax-cutting policies is not yet clear. Really, he is still introducing himself to the general public. But what is clear is that the very same general public is very unhappy with the economy, and blames President Obama for it.
Obama owns the economic angst. His big-government policies have not solved it. All his finger pointing and blame-game, enemies-list excuses are not working. That’s really what the polls are telling us. And unless something very big and very positive happens to the economy in the next few months, Mr. Obama is in a heap of trouble.
As for Mitt Romney, right now he may be the most underrated politician in America. The odds of a Romney win come November look increasingly good.
– Larry Kudlow, NRO’s economics editor, is host of CNBC’s The Kudlow Report and author of the daily web log, Kudlow’s Money Politic$.