Reading the Tea Leaves
The vast majority of political scientists and economists who forecast elections based on computer models will be presenting their papers at the annual meeting of the American Political Science Association this week in Chicago, and they are projecting a Bush victory over Sen. John Kerry -- in a landslide, some say. Other analysts, myself included, think Bush faces an uphill struggle.
The boldest prediction is from Yale University economist Ray Fair, the dean of the election-forecasting academicians whose model projects that Bush will get a whopping 57.48 percent of the major-party (combined Democratic and Republican, no independent) vote. Fair's model is based entirely on economics -- the real gross domestic product growth rate and inflation -- and it carries, he says, a standard error rate of 2.4 percent in either direction.
In his July 31 "Note to the Media" on his Web site, Fair cautions that a change in economic data could affect his forecast but that "no realistic economic values can bring the predicted vote share to even about 53 percent." Of course, Fair, like most other modelers, predicted a landslide for Al Gore in 2000.
Another bullish Bush prognosticator is political scientist Helmut Norpoth of the State University of New York (Stony Brook), who gives 20-1 odds that Bush will be re-elected. His model shows a Republican two-party-vote victory of 54.7 percent to 45.3 percent. Norpoth's model focuses on how well the nominees performed in their respective party's primaries, on long-term partisan trends, and on how long the incumbent's party has held the presidency.
Slightly more conservative is a model developed by Oxford University's Christopher Wlezien and Columbia University's Robert S. Erikson that projects a 52.8 percent Bush share of the two-party vote. They say that Bush has slightly better than a two-out-of-three chance of re-election. The Wlezien/Erikson model relies upon the index of leading economic indicators, as well as on Gallup job approval ratings and trial heat data.
A model developed by the University of Iowa's Michael Lewis-Beck and Hunter College's Charles Tien shows a two-party-vote edge for Bush of just 51 percent to 49 percent. They say that "the narrow difference makes the race too close to call." The "Jobs Model," as the authors call it, focuses on job creation and presidential job approval.
At Emory University, Alan Abramowitz's "Time for a Change" model uses three variables: the incumbent's job approval in June, the change in real GDP during the first two quarters of the election year, and the amount of time -- whether one term or longer -- the incumbent party has held the White House. While Abramowitz's model projects a Bush win of 53.7 percent of the two-major-party vote, he is doubtful about whether it will work this time; he concludes that "it seems unlikely that [Bush] will receive anything close to 53.7 percent."
Abramowitz argues that Bush is unlikely to enjoy the 5-point boost that elected incumbents usually receive, because his support among independents and Democrats is sharply limited by the high degree of polarization, the disputed 2000 election, and "intense divisions within the electorate over many of the Bush administration's policies, including the war in Iraq."
To my mind, the most important figure to emerge in recent days was the revised second-quarter GDP figure, which dropped to 2.8 percent, the slowest growth rate in over a year and the lowest since the first quarter of 2003. According to Abramowitz, since 1948, the average second-quarter growth rate in a presidential election year is 3.9 percent. The average real GDP growth rate in a year in which an incumbent won is 6.3 percent; the average when an incumbent lost is 1.5 percent.
When the economic growth rate has been 4 percent or greater in the second quarter, the incumbent party has won seven of the last eight elections, Abramowitz points out, the exception being the Democrats' loss in 1968. When the economy has grown by less than 4 percent in the second quarter, the incumbent party has lost five elections out of six, the exception being President Eisenhower's re-election in 1956.
The current economic growth rate is a lot closer to the rate in years when incumbents lose than it is to years when incumbents win. Human nature being what it is, individuals will continue to cling to the data that support the conclusion that they may have already reached (or want to reach). We'll see on Nov. 3 which ones are right.