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On Sept. 2, 2011, the American people decided they will elect a Republican as president in November 2012.
The prediction is not some partisan wish-dream. It’s based on hard, almost irrefutable, evidence.
Many years ago, I was talking with a leftish political science professor college buddy of mine, and the conversation turned to what effect the economy had on elections. He maintained that economic conditions were just one of at least 13 variables—sociological, single-issue, mood, blah, blah. Just to get his goat, I took the thoroughly Marxist, economic determinism view that economics were almost, maybe totally, determinant.
Our little discussion ended in a draw. Neither of us had the flimsiest evidence for either of our silly opinions. (Guess this is the sort of thing that goes on in faculty lounges.)
Not much later, I had occasion to reread Milton Friedman’s monumental “A Monetary History of the United States.” I discovered an appendix I had neglected. (Honestly, how many of us read statistical appendices to any book?)
Friedman had constructed a quarterly history of the U.S. economy going back to just after the Civil War. His main metric was roughly what we today might call “real” gross domestic product.
Hmmm, said I. Let’s see what effect the economy has on presidential elections. And that Thursday afternoon, I propounded what I have evermore dubbed the Iron Law of Presidential Elections: If there is even one negative quarter (a decline in real GDP) in the year of the election or the year prior to the election, the party in power in the White House switches.
The only exception to the Iron Law was Dwight Eisenhower in 1956. But this might be the exception that proves the rule. Eisenhower was the not-so-much-politician grandfather figure who led us to victory in Europe in World War II. The D’s needed to run God himself to stand a chance.
Note a couple of things about the Iron Law:
• It doesn’t require a recession. Only one quarter of real GDP loss in the presidential year or the year prior.
• It makes no difference how big that negative GDP is. Minus 0.1 percent works as well as –10 percent.
• The Iron Law says nothing about personalities. It simply says whether the incumbent party retains the White House.
How confident am I about the Iron Law? In March 1991, I wrote (in another publication) flatly predicting that a Democrat would be elected in 1992. At that time, it was clear the first quarter of 1991 would be negative, so the Iron Law kicked in. At the time, President Bush 41 stood at nearly 90-percent approval. Remember, we were aglow with the tremendous victory of the first Iraqi war.
Every name Democrat at the time—Bill Bradley, Mario Cuomo, etc.—took a look and passed. This guy in the White House can’t be beat.
Predicting in March 1991 a Demo win in 1992 was insanity. But Bill Clinton won.
Which brings us to Sept. 2 this year. The August jobs report from the Labor Department showed zero growth, surprising everyone.
The economy was already growing at less than 2 percent in the first and second quarters. Such slow growth has almost always been followed be a negative quarter two or three quarters down the road.
The August jobs news virtually guarantees a negative quarter (possibly the one we’re in now). The Iron Law says Republicans will get the White House.
Mike Pence shouldn’t pop any champagne corks, though. Indiana gubernatorial elections have a nasty habit of running counter to national trends (Bowen in ’76 with Carter, Bayh in ’88 with Bush 41, O’Bannon in 2000 with Bush 43, Daniels in ’08 with Obama).
But if you can find someone who wants to bet on the D’s being in the White House in 2013, take the bet.•
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Styring is an economist, a former Indiana Chamber of Commerce lobbyist, and a former senior fellow at the Hudson Institute. Send comments on this column to ibjedit@ibj.com.
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