If we are seeing the economic recovery’s reversal, will we see political history’s too? Just as the Depression and recent recession are frequently compared, it is hard to not compare their two presidencies. It is easy to see why Obama would want to be FDR. Recent dismal news, however, hints the economy may not be cooperating.
Recent economic news could hardly be worse. Housing prices have continued to fall nationwide. The coup de grace came with an employment report that last month only 18,000 jobs were created and the unemployment rate increased to 9.2%.
Economic recoveries are not necessarily seamless. Even FDR learned this through bitter experience—something we often forget today. In hindsight, we lose sight: The New Deal had its own double dip—suffering a 3.4% real gross domestic product (GDP) contraction in 1938. Even so, FDR successfully traversed it into the history books.
While the parallels between the Depression and today remain economically intact, there are compelling reasons why they may not play out politically.
First, we must understand how serious a political blow the seemingly invincible FDR suffered following 1938’s recession. FDR’s Democrats lost 71 House and six Senate seats in the 1938 election. That was the largest seat loss in FDR’s presidency, reversing four consecutive elections of Democratic congressional gains. That level of congressional dominance would never return.
FDR saw a muted impact himself. In 1940, his popular vote total fell 6% from his 1936 percentage. As in Congress, he would never regain the heights reached in his first two elections.
The difference in impacts on FDR and congressional Democrats is assuredly due to several factors, but one is particularly relevant for today’s politics: timing.
Unlike Congressional Democrats catching the recession unabated, FDR had two years to recover. Obama may not be as fortunate.
If the economy does indeed fall back into recession, it is going to do so perilously close to the 2012 election. In political reality, there are only four quarters remaining that will politically influence the electorate—2011’s last two and 2012’s first two. If the economy falters, it is likely to do so in precisely those.
FDR also had the advantage of having several years of strong economic growth before the 1938 recession. The economy improved following FDR’s inauguration (even 1933’s -1.3% real growth was slower than the previous three years’ declines)—growing 10.9%, 8.9%, 13% and 5.1% from 1934 through 1937.
Contrastingly, Obama has had but two years to build his economic capital. During these, the economy grew—2.6% in 2009 and 2.9% in 2010. Even prior to last week’s news, the nonpartisan Congressional Budget Office only projected 2011’s real GDP growth at 2.7%. Further slowdown, much less another recession, would greatly tax that economic capital.
Unsurprisingly, Obama consistently polls weakest on economy-related issues. According to a May 31 CNN/Opinion Research Corp. survey (1,007 adults, margin of error +/-3.1%), Obama had a 41% approval versus 58% disapproval on handling the economy and 34% approval versus 64% disapproval on handling the federal budget deficit.
FDR too had the advantage of absorbing his midterm electoral hit when he had much more political capital. Accumulated over four consecutive elections, Democrats had enormous congressional majorities. Despite high 1938 losses, FDR still retained 93-seat House and 46-seat Senate majorities.
Contrastingly, Obama suffered a political setback ahead of any double dip—losing control of the House and emerging with just a six-vote Senate majority.
One bad month hardly makes a recession. Yet political vulnerability to one is high, even in the strongest of Presidents—as FDR’s 1938 experience shows. FDR had both high economic and political capital to weather his. At the same time his economic capital is being stressed, Obama’s political capital is also depleted.
Obama strategists already knew reelection would be far harder than election. Like Houdini, Obama seems to be being presented with increasingly difficult circumstances to escape. With the possibility of a double dip looming, so too does the possibility of Obama becoming Roosevelt in reverse. FDR faced worse economic circumstances, but better timing. It would be hard to blame Obama for wishing to trade places. Timing is said to be everything in comedy. It may well be in the economy too.