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Current Trade Deficit:    
The Exit Polls and the Economy
Alan Tonelson
Friday, November 09, 2012
Photo of Alan Tonelson
Alan Tonelson is a Research Fellow at the U.S. Business & Industry Educational Foundation and the author of The Race to the Bottom: Why a Worldwide Worker Surplus and Uncontrolled Free Trade are Sinking American Living Standards (Westview Press).
How great it would be to provide a fact-based analysis of how trade and manufacturing issues affected the 2012 Presidential and Congressional races.  Unfortunately, despite the prominence of China trade and offshoring during the fall campaign, the exit polls ignored subjects that bear heavily on the fate of the economy's most productive, most innovative sector.  Let’s hope that other surveys start filling in the gap in the weeks and months ahead.  

Even a perusal of manufacturing-heavy states doesn’t shine much light on the question.  True, the President carried virtually all of the so-called Rust Belt (including Pennsylvania).  But Governor Romney carried major industrial states elsewhere – especially in the south.

Clearer conclusions seem justifiable on some broader economic issues with big political implications.  Four stand out so far.

First was the exit poll finding that by a 53-38 percent margin, the 2012 electorate blames former president George W. Bush for America’s “current economic problems” instead of President Obama.  Many Republicans and conservatives have long dismissed the idea that the president could avoid ownership of the nation’s pitiful recovery once he began putting his stamp on public policy.  In particular, they loved to trot out Mr. Obama’s early prediction that if he didn’t engineer a dramatic economic turnaround, he’d be retired after four years.  
But even though he’s now served nearly a full term, a solid majority of actual voters have clearly bought the idea that the Bush years produced so much economic damage that no successor could have achieved significantly better results.

Some might be tempted to dismiss the effects of this version of the “blame game.”  They shouldn’t.  For decades after the Great Depression struck, Republicans were stuck with the label as “the party of Hoover.”  And the exit poll results will undoubtedly persuade Democrats to keep transmitting this message as long as they can.  Further, the use of effective political communicators like former President Bill Clinton appear to guarantee that this tack will have legs for the foreseeable future.

Moreover, the logical extension of this argument is that the party held responsible for the worst global economic crisis since the depression can’t be trusted with the reins of power for the time being, and seems likeliest to drive the nation back “into the ditch.”  So Mr. Obama’s Republican opponents will need to persuade voters that they represent a decisive break with the bubble-decade presidential leadership their party provided.  Not that any Republicans proudly ran on the Bush record.  But the GOP plainly needs to make more progress dissociating themselves from the 43d president.
    
This first finding is reinforced by a second – America’s economic performance since the recovery technically began in mid-2009 may be miserable by historical standards, but a critical mass of 2012 voters said they were reasonably satisfied with it.  For example, by 52-46 percent, 2012 voters agreed that “the country is going in the right direction.”  And whereas 30 percent perceived the economy to be “getting worse,” 39 percent saw improvement.  (Twenty-nine percent saw economic conditions as stable.)

Moreover, as would be expected, voters who deemed the economy to be in good shape broke decisively for President Obama, while voters who gave it bad grades opted for Governor Romney.  The same results were produced by differences in opinions on the economy’s direction.  

But a big plurality – 45 percent – viewed the economy as “not so good,” and they voted 55-42 percent for the incumbent.  Similarly, voters who judged their “family’s financial situation” to be better strongly favored President Obama, while those perceiving themselves and their loved ones to be stuck in a deeper hole favored Governor Romney.  Those who believed their family’s position hadn’t changed much?  The President won them by 58-40 percent.
  
So although the Republican nominee kept insisting that the economy should be doing much better, most voters seemed unconvinced.  An alternative, but not clashing possibility that takes into account “blame Bush” views – a critical mass of voters feared that a Republican victory would reproduce the policies that led to the last crisis.  

The one data point conflicting with this conclusion:  Governor Romney won the 29 percent of voters who believed that the economy was “staying about the same” by a strong 57-40%.    

The third main conclusion emanating from the exit polls, and overlapping logically with the second:  Governor Romney didn’t convince enough Americans that he could produce enough economic improvement to merit the presidency.  

Despite a U.S. economy growing slower this year than last year, and an employment situation only slightly better, Americans agreed by only a 49-48 percent margin that the Republican challenger could handle the economy better than the incumbent.  Further, the Romney advantage on handling the federal budget deficit was only 49-47 percent.  

Finally, although they broke slightly for Romney, only 15 percent of 2012 voters named the deficit as the “most important issue” facing the country.  Number one by a long shot (59 percent) was the economy.  This finding makes clear that as long as the dangers of big budget deficits remain future possibilities rather than realities that are either present or feared to be imminent, American leaders will benefit politically from cushioning economic pain with more transfer payments, and from Federal Reserve Board programs that keep buoying growth and employment—however feebly – with more free money.  

The biggest natural political barrier looming to this approach?  Not apparently the specter of whatever higher taxes might be needed to close the budget gap.  Only 14 percent of 2012 voters named this as the “biggest economic problem facing people like you.”  Rather, it’s the possibility of such stimulus sparking inflation.  Thirty seven percent of the electorate labeled this as their biggest economic concern – only one percentage point less than the 38 percent identifying unemployment.  



Alan Tonelson is a Research Fellow at the U.S. Business & Industry Educational Foundation and the author of The Race to the Bottom: Why a Worldwide Worker Surplus and Uncontrolled Free Trade are Sinking American Living Standards (Westview Press).