Can McCain Win if There’s a Recession?

Updated on 3/7/08: Zogby just came out with a poll on the issue of the election and the economy. McCain does OK:

As concerns grow that the U.S. may be facing a recession, likely voters view Hillary Clinton (26%) and John McCain (25%) as the presidential candidates who could best handle the economy, just edging out Barack Obama (21%), a recent Zogby International telephone poll shows. Among Democrats, nearly half (48%) believe Clinton would best handle the economy, compared with 35% who believe Obama would do a better job.

The last time we had a recession during an election year was 1980. Jimmy Carter's pitch—"elect that kook Reagan and things will get even worse"—turned out not to be a huge vote getter. Thinking not so wistfully of Carternomics reminds me of a great scene in the film Ed Wood about the notorious producer of schlock like Plan 9 from Outer Space. One of his financial backers phones Wood and tells him that his latest production was the worst film the moneyman had ever seen. But the always-chipper Wood quickly replies, "Well, the next one will be better! . . . Hello?"

That attitude doesn't usually fly with voters, either. We tend not to have much patience with economic failure on the part of our elected leaders. Indeed, those fancy economic models that political scientists use to forecast elections all tend to severely punish candidates from the incumbent presidential party when there are sharp downturns in election-year economies. Ray Fair, a political scientist at Yale University, figures that Democrats will win 55 percent of the two-party vote if the economy does slip into recession. Pretty much a blowout. So should John McCain keep his day job? Maybe not. A few caveats here:

1) As my colleague Michael Barone has pointed out, plenty of voters have never experienced a truly nasty recession and thus may not totally freak out as their Depression-era parents did whenever the economy dipped. Many people today assume a growing economy is the natural state of things and any downturn will probably be brief. Thus, they may be more patient with the incumbent political party—or be equally disgusted with both parties. McCain's maverick image could help him here.

2) Foreign policy—an issue that cuts both ways for Democrats and Republicans—will most likely play a big role in the election, as it did in 2004 when many, if not most, of the forecasting models picked John Kerry to beat President Bush.

3) We have had only one election since 1900 where there was no president or vice president on the national ticket and also there was a recession in the year of election. That was 1920, and the incumbent Democratic Party did lose in a landslide. But that is a single data point. Will voters this time around blame John McCain for a recession or lousy economy caused by a collapsing housing bubble? I doubt too many people blame Bush for that. Last time I checked, both Congress and Bush had terrible ratings as soaring gas prices, the falling dollar, rising unemployment, and the collapsing housing market make it seem as if the U.S. economy has gone off the rails. And none of the remaining candidates have a reputation as an economic expert.

4) McCain's push for budget cutting may be seen as a proxy by Americans for sound governmental management. Big deficits—whether trade or budget—can look like signs of incompetence. This could serve McCain well. He could say, "The president's job isn't to manage the economy. It's to manage the government so it doesn't hamper the economy," or some such. Yet he also needs to tell people about his plan to grow the economy—and believe in the plan, even though it includes tax cuts he once opposed.

5) If the economy is coming out of a recession as we head into 2009, I'm not sure Americans will see higher taxes and more government spending as the right economic medicine. Indeed, that potential combo could cause Wall Street to sell off sharply as Election Day approaches and the stock market vigilantes cast a nay vote. Yet I am sure either Hillary Clinton or Barack Obama would employ the Clinton defense as a shield against such criticisms.

Bottom line: Whoever has the more credible, optimistic vision will probably win on the economy.