1. A looming recession, after seven years of stagnation in the US median wage, means that the likelihood of positive income growth this year is very small. Even assuming it’s 0% would mean that the incumbent party’s nominee, McCain, can be expected to lose by an 8% margin in the straight line fit below. To break even income needs to grow by around 2%, which looks more unlikely with every new financial breaking story.
More likely, it will be around 0% or worse and McCain would be facing a landslide defeat, as in 1980.
2. Q1 growth was at 0.9% (practically all of it down to improvement in the balance of trade), although a slight amelioration is expected this summer due to the tax rebate coming into effect. But after that, with the housing bubble still far from popped, hundreds of banks facing the spectre of insolvency and the full ramifications of 130$+ oil coming online, it is hard to see the US avoiding a recession. So let’s say first half growth will be at 1%.
This would imply McCain getting 45-51% of the vote. And this is the part on which he performs best
3. According to opinion polls, Bush’ approval hovers around 30% and disapproval around 65%, giving a net approval of -35%. As the graph below shows, this is a record.
Going from this graph, McCain would do well to scrape 45%.
4. To add to McCain’s woes:
Also, a number of models find that there’s an 8-year itch: voters tend to turn against the incumbent party if it has held the White House for two or more terms.
Right now, GDP is flat (falling in the monthly estimates); Bush has a negative net approval of 30 percent or more; and people are tired of Republicans. So it ought to be a smashing Democratic victory. When I plug current numbers into the Abramowitz model (making a guess about 1st-half GDP and assuming that Bush approval in June will be about where it is today), it says 57-43 Democrats.
Despite Obama’s numerous gaffes (Wright, gun-toting Bible-bashers, etc), even in (usually unreliable) pre-election opinion polls he is getting a lead over McCain. Of course there’ll also be a few third part candidates who’ll hack off 3-4%, and McCain has taken care to distance himself from Bush. Perhaps the Democratic win will be 44-52. Nonetheless, still crushing. Political science might be full of uncertainties, but those uncertainties must reveal miracles for McCain to have a chance.
This is why Obama will almost certainly win. I have put my money where my mouth is and bet 100$ on Obama (too bad the bookies are certain Obama will win too, lol). And I congratulate Americans for their good sense.