Republicans have bad luck. In the last two presidential elections, voters considered the economy to be their top issue — and they hammered the Republicans on their failures here, including their policies toward Wall Street. This time around, voters consider the economy and Wall Street to be less important — and the issue fades a bit more with every month of job growth.
This is hardly good news for the GOP, though. Voters still care about the economy, and they care less acutely only because, under a Democratic president, they've watched the economy recover from the worst economic and financial crisis they've ever experienced. Republicans can blunt this disadvantage. But it will require them to go against every economic and political instinct they have.
Nearly eight years after the 2008 meltdown, Americans' deep concern over the economy is fading. In an April poll, 53% of potential voters told The Wall Street Journal and NBC News that "job creation and economic growth" was either the first or second most important problem the country faces. That's high. But it is down markedly from four years ago, when 68% of potential voters thought that way. The figure was down, too, from the 59% of voters who thought economic issues were most important in the 2008 election, even before 8.8 million people lost their private-sector jobs.
As time passes and the recession fades, it's natural for people to move on. Early in President Obama's second term, America finally recovered the jobs it lost after our financial meltdown. Today, we have 3.4 million more private-sector workers than we did during President Bush's employment peak. Home prices, too, have been recovering for three years. They're now 30% above their 2012 low, and only 17% below their bubble-era high. Americans have shed debt. Mortgage debt is down by $1.2 trillion, back to where it was in 2006. Total household debt is down to where it was in 2007.
People even like the banks — a little bit — again. Starting last fall, slightly more Americans viewed banks positively than negatively, the first such showing since 2007.
As people feel better, they cease holding grudges — good news for the Republicans. As recently as last year, 44% of Americans blamed Bush for our "current economic problems — still a remarkable showing for someone who had been out of office for six years. Only 34% blamed Obama; another 14% blamed both. Yet the number was down from 57% blaming Bush on the eve of Obama's 2012 re-election.
The problem for the GOP, though, is that people have stopped blaming Bush — and, by extension, all of them — only because they've stopped caring quite so much. As the economy has improved, voters have remained satisfied with President Obama's economic performance. In April, 49% thought he was doing a good job here. That was up from a low of 37% in early 2011, when we still had six million fewer jobs than we had in 2008. (Bush's economic-approval rating on the eve of the 2008 election was 20%.)
Unfortunately for the Republicans, then, it's not a bad time for a Democratic candidate to run — largely on continuing Obama's economic record. It's especially not a bad time if you happen to be the spouse of the previous Democratic president, who presided over the biggest economic boom the country has seen in most people's lifetimes.
Can the Republicans turn the economy into an advantage for them — or, at least, into less of a disadvantage?
Yes — but not by doing what they usually do. They can't run against Obama's record. The proof is that they tried it in 2012, and the effort failed spectacularly. The "are you better off today than you were four years ago" strategy that worked for Reagan in 1980 failed because voters could see — well before most economists did — that it was always going to take more than four years to recover from the debt mess we made for ourselves in the years before 2008.
Nor can Republicans sit around and wait for something bad to happen in the final few months — and then blame Obama and the Democrats. That's not because nothing bad will happen; it could. Much of our recovery is fueled by record-low interest rates. Even without a fresh financial crisis, even marginally higher interest rates could sink house prices and consumer spending as well as car sales. But with the trauma of the 2008 crisis still so fresh in people's minds — this is a time when people were calling their relatives wondering if they should leave money in the bank, after all — there's still no guarantee people won't revert back to blaming Bush.
