Tuesday, May 29, 2012

"Wargaming" the 2012 Presidential Election - June 2012 Update

In mid-December of 2011, I took my first look at 'Wargaming' the 2012 Presidential Election.  This involved taking a hard look at the trends apparent at that early stage of the 2012 campaign to see / project which candidate, President Obama or the presumptive Republican nominee, would have the best path towards victory in November.

Since that look at the 2012 Presidential Election, a number of major events have taken place. 

Mitt Romney has emerged as the presumptive nominee for the Republican Party, clinching the number of needed delegates on May 29th's Texas Republican Primary. 

Barack Obama has 'evolved' on his position regarding same-sex marriage, choosing to support same-sex marriage just days after North Carolina voters cast 61% of their votes supporting a state constitutional amendment defining marriage was being between one man and one woman.

Since December 2011, the economic record of the United States has not improved significantly.  While the 4th Quarter of 2011 saw a 3% GDP growth on an annualized basis, 2011 saw only a 1.7% GDP growth.  The 1st quarter of 2012 saw a return to the slumping GDP growth numbers of early 2011.

This same pattern was also apparent in jobless numbers - while the economy averaged nearly 250,000 monthly new jobs for a 3 month stretch covering the end of 2011 and start of 2012, this number collapsed in March and April of 2012.  While the 'official' unemployment number decreased over this timeframe down to 8.1% today, the entire basis of that decrease is by a reduction in the size of the labor pool - to the point that labor participation today is at the lowest level in 30 years.  If the unemployment rate was calculated today based on the labor participation rate in effect on January 20, 2009 when Barack Obama was inaugurated, we would be experiencing a 11.1% unemployment rate.

All of this information will have an effect on this glance at the 2012 Presidential election.  But we are also just over 5 months away from Election Day.  With 5 months before Americans go to the ballot box, there is plenty of time for new events to change or influence how the electoral vote may develop.  Just in June, we are looking at a real challenge of a major financial crisis in Europe related to Greece (and Spain, Ireland, and Italy) that could have major repercussions on the stability of our financial systems.

In December's report, 12 key swing states were identified as being the primary focus for our look at the 2012 election.  All of these 12 swing states voted for Barack Obama in 2008.  Many were traditional Republican states that followed the tsunami of 'Hope and Change' in 2008.  But in the reverse tsunami of 2010's midterms and polling numbers which show that moderate Democrats and Independents may be moving away from support President Obama primarily over issues related to the economy, these states were seen as being in play.  I do not believe that this has changed. 

Once again, I am using the excellent website, 270 to Win, to provide the maps.

Here is the starting position map that I used from the December report .....

Here is the starting position map from 270toWin today, based on 'swing states'....

This 'starting position' has a couple of changes from the earlier starting position - leading to President Obama having 217 electoral votes at this point, while Mitt Romney is sitting at 191 electoral votes.  New Mexico is shown by 270toWin as now trending Democrat towards President Obama.  Michigan is also shown as trending Democrat towards President Obama.  All of Nebraska is now showing on the Republican side of the ledger and Indiana has reverted from leaning Democrat in December to now leaning Republican today. 

Indiana was not identified as one of the 12 key swing states in December.  It's move to the Republican side is, in my opinion, a major reflection of the economic condition within the United States and how that has influenced the Indiana electorate despite its strong ties to organized labor.

In New Mexico, the effects of the economy seem to have less influence than the results of the debate around immigration and social issues.  Looking at RealClearPolitics for polling information, Rasmussen's last poll of New Mexico from early April (survey 500 likely voters) has Barack Obama up by 16 points.  This info is a little dated, but Rasmussen is a reliable poll and likely reflects a state that has moved to the Democrat column.

The only other challenge to consider over this new starting position is Michigan.  Michigan is part of the 'rust belt'.  It was hammered in the 2008-9 recession.  The state also suffered from a severe fiscal challenge brought on by not only the recession, but several decades of progressive governance which greatly contributed to its fiscal challenges.  In 2010, breaking the trend, the GOP candidate for Governor, Rick Snyder won 58% of the vote.  The GOP also gained a strong majority control of Michigan's House of Representatives and a two thirds majority of Michigan's Senate. 

With this Republican leadership in Lansing, Michigan, they passed earlier this year a 2012 budget that eliminated a $2B+ deficit via spending reductions and a major simplification of corporate taxes including adopting a flat tax. 

While the latest polls, which date to early this month, show a 5 point lead for President Obama, I still strongly believe that Michigan remains in play, long with neighbors Ohio and Wisconsin.  Moving Michigan to a 'toss-up' swing state resets the electoral count significantly.   President Obama still has a lead, with 201 'safe' electoral votes, while Mitt Romney trails by only 10, with 191 'safe' electoral votes.  From this, both candidates have over 150+ combinations to 270 - reflecting a very close election and one that should worry Barack Obama's campaign team.

In my original post, I wrote the following....
2012 is going to be an election based on a referendum of the policies and agenda of President Obama and Progressives. The results achieved, or more specifically, the lack thereof, will have a lot to do with the turnout and the voting direction. People will be asking themselves if they are better off now than they were in 2008 - even though the recession and banking crisis was at it's nadir during the election season. The President is looking to not only flood the airways with advertisements spending a targeted $1 Billion to gain re-election, but will also run one of the dirtiest campaigns ever seen as his base attempts to maximize voter turnout and leverage voter fraud as much as they can.
In the five and a half months since I wrote that we've witnessed that the President is well off the pace for achieving $1 billion for his reelection campaign.  His fundraising is not only well below his 2008 campaign levels, but also trails President George W. Bush's 2004 fundraising levels.  From these results, one of the main conclusions that one can make at this point is that the enthusiasm level towards supporting the President's reelection is down, perhaps even way down.  That cannot bode well for the President as we look at the contests in the swing state.

Furthermore, when I took my first look at the 2012 contest, the GOP was in the midst of a highly contentious primary battle.  This bitter fight between a number of major candidates made it a major question if the Republican party could select a candidate through the primary process - and if the party could unify behind this candidate.

As equally a concern to party unification behind a single candidate comes another challenge for the President - his record of achievement during his first term in office.  While the left rejoice over Dodd / Frank and Obamacare - these items combined with a stagnant economy and out of control spending which added over $5 trillion of new debt in 39 months, worked to unify not only Republicans, but many Independents to oppose this record.  Then we have the social issues, like same-sex marriage, that will also have an impact in some key swing states. 

As I write this, the Republican party has unified to large extent behind Mitt Romney - and unified in a manner that many thought was unlikely in December 2011.

The President is generally choosing not to run on his record, except for the record of getting Bin Laden.  He is trying to say that we need more of his policies, more spending, more taxes, all in the name of 'fairness' and 'social justice'.

So, with this basis, let's look at how the swing states are falling....

The first swing states I looked at in December were Virginia, North Carolina, Florida, and New Hampshire.  All looked to be trending towards the Republican side of the ledger. 

Today, North Carolina is clearly, IMO, on the Republican ledger.  The President had been struggling in polls in the state prior to the vote on the issue of same-sex marriage.  61% of the state voted against same-sex marriage - and when the President came out in support of it, his numbers tumbled significantly - including losses in his exceptionally strong African-American base.

Florida, one of the hardest hit states from the 2008-9 recession, is another one that will continue the direction established in November 2010 and support Romney over Obama regardless if Fl. Senator Marco Rubio is on the ticket or not.   In a Quinnipiac poll from earlier this month, Romney has a 6 point lead over the President.  I think this is showing the direction that the vote will continue to move over the next 5 months.

New Hampshire has not had a significant poll on the race for a while, so there are no hard numbers to offer where it leans.  I still believe that it is trending towards the GOP as a state that stands far closer towards GOP values than Democrat values of higher taxes and bigger government.  It is still looking as if it will be the only state in New England that will support Mitt Romney.  The rest of the region is just too liberal - although Romney may be able to squeak out an electoral vote from Maine if the economy remains struggling.

Virginia remains a real toss up.  The challenge for the GOP in Virginia is getting sufficient turnout in the rest of the state to offset the Democrat bastion around Arlington and Fairfax counties.  A Washington Post poll that oversampled Democrats by 10 points has Obama up by 7.  A Rasmussen poll 5 weeks ago has Romney up by 1 point - in the margin of error.  I think that VA will go GOP if the economy does not demonstrate a major turnaround by November, but for the sake of this analysis, I will keep them uncommitted for now.

So, where does this put us?

Mitt Romney 239 electoral votes - 29 winning combinations left.
Barack Obama 201 electoral votes - 20 winning combinations left.

Let's now take a look at the Western states.

Nevada has the nation's highest unemployment rate - and was hammered by the 2008-9 recession.  In 2010, the GOP vote was split between the 'Tea Party' and the 'Establishment', which resulted in Harry Reid getting another term as Senator and Senate Majority Leader.  Despite the challenges in that state with the policies of President Obama and Senator Harry Reid, I think the GOP will have a hard climb to get their state to turn red. 

Colorado is a major swing state - as it is on a razor thin margin between trending 'blue' and trending 'red' / conservative.  In 2008 it went blue.  In 2010, it went slightly more towards red.  Except for an outlier poll by the pollster of the hard liberal blog, Daily Kos, the polls are generally within the margin of error.  I think, like in Virginia, it's going to trend Republican in November, but we're going to leave it undecided at this point.

Turning back to the Industrial states, we are where I think the election will be determined in November.

Next week, Wisconsin is going to the polls to vote on a recall of Republican Governor Scott Walker and 4 other senior state elected offices - all Republicans.  This came from the angst resulting from Walker's programs to address the State's fiscal challenges...all of which have worked.  Unemployment is down.  Wisconsin has gone from a $2 billion deficit to a $154 million surplus.  For the first time in nearly 20 years, property taxes have declined.  Hundreds of school districts that ran deficits are now running surpluses after the union changes - and the GOP enthusiasm is high - and growing.  The President and liberal Democrats are in trouble in this state.  I think it will go 'red' in November.

Michigan, as noted before, went strongly to the GOP in 2010.  The economy remains a major issue and concern in the state - while the traditional Democrats and organized labor remains a strong base of support for President Obama.  The steps of Governor Snyder appear to be working for the people of Michigan - and my perception is that the GOP has the enthusiasm advantage here as they do in Wisconsin.

In Ohio, it is also very much a battleground, with the majority of the 'current' polls within the margin of error.  While organized labor was able to reverse the efforts of the Ohio Governor Kasich to implement legislation similar to Wisconsin's- the result of the reversal were a return to deficits, reductions in service, and layoffs.  Wisconsin moved positively - and Ohio did not.  This simple fact is what is going to tip the independents - particularly if Romney picks Ohio favorite son Rob Portman as the VP candidate.

So, time for another glance at the map....

Virginia, Pennsylvania, Michigan, Iowa, and Colorado remain undecided.  Mitt Romney is now sitting with 267 electoral votes, only 3 short of the 270 needed.  He has 5 winning combinations - a win in any of the remaining 5 states will give him a victory.

Barack Obama has 207 electoral votes and has to sweep these 5 in order to get his victory.  That's a tough hill to climb, but not impossible.

The foreshadow of a very long night for the President remains Pennsylvania.  He needs to win big enough in Philadelphia and Pittsburgh to offset his losses in virtually the rest of the state.  Rasmussen has a poll from earlier this month with the President holding a 6 point lead in the state.  But the challenges with the economy run deep in the state.  I think it will ultimately go to the President, but by a far smaller margin than he received in 2008.  If he doesn't win in Pennsylvania - he's toast...and Romney is looking at a 325+ total electoral vote margin because Virginia and Michigan will also follow that trend.

In the five and half months since my last look, I think that the Republicans have gained a little -primarily because of the continued economic and policy issues with the President's record.  Polls do not entirely measure this, and more and more polls are being skewed by the pollsters, mainly elements of the mainstream media, who support the reelection of the President.  The Tea Party is a little less visible - but still having a real effect - as does the success of the State elected officials who have implemented conservative / tea party agenda policies to address their fiscal challenges.

This remains a very close election - but the trend is working against the President.  In 1980, the polls showed Jimmy Carter leading Ronald Reagan until October.  Only after early October did Reagan start to pull away.  This election has many similarities with 1980.  While Mitt Romney is not a Ronald Reagan, he does have the unified support of the vast majority of the Republican Party.  I would not be shocked if November 2012 looks more like 1980 than 2004 or 2000 - with a nail biter down to the wee hours.

I'll take a new look at the end of the summer / end of the party conventions.

Thanks for reading.

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