The Known Unknowns

The Republican Party is in the midst of a self-immolating primary that pits its electable, if unpopular, moderate wing against its unelectable, passionate flank. President Obama has more than 10 times the cash on hand as his nearest rival, and his team is rapidly building a ground organization unlike any seen in modern politics. And, slowly, the economy is bouncing back.

Those should be sure signs of a president cruising toward reelection. But Obama’s team doesn’t sleep easy at night, and it shouldn’t: The eight-month path between now and Election Day contains a series of obstacles, all of which pose threats of various degrees to the president’s campaign. They are the three G’s—gas, Greece, and the Gulf.

Together, those three factors represent what former Defense Secretary Donald Rumsfeld might call the “known unknowns” of the campaign. They conspire to throw the best-laid plans of even the smartest campaigns off-track and off-message, and they demonstrate the limited power of the presidency in an age of global economic connectivity and turmoil.

Already, rising gasoline prices have damaged Obama’s standing and sapped some of the consumer confidence that was building around a reviving economy. A CBS/New York Times poll released on Tuesday showed Obama’s approval rating falling to 41 percent, its lowest point ever in that survey and a 9-point drop since the second week of February. Just 39 percent said they approve of Obama’s handling of the economy, down 5 points since last month. That precipitous drop has come as gas prices skyrocketed from an average of $3.47 a gallon when Obama registered a 50 percent approval rating in the last New York Times survey on Feb. 13, to $3.81 a gallon on Wednesday.

Republicans, wisely, began hammering Obama over gas prices weeks ago, before most Americans began feeling the most acute pain at the pump. The cost of gas rises predictably during each spring; a senior Republican strategist involved in developing the gas-price line of attack confided that the party was getting a head start, to put itself in a position to capitalize when Americans tuned in. The difference between this year and other years, however, is that prices have begun to spike earlier in the year than in the past; over the past six years, gas prices have traditionally spiked around May and June, rather than in February and March, according to data from the Energy Information Administration.

Meanwhile, the threat of a possible shooting war in the Middle East looms larger than ever. Israeli officials are talking openly of attacking nuclear facilities in Iran, and Defense Secretary Leon Panetta told National Journal that the United States has begun preparing military options if economic and diplomatic sanctions fail. If Israel attacks, they will likely do so with American support—not only political, but also military. Though politics used to stop at the water’s edge, any open conflict would have ripple effects in the presidential contest.

The problem is neither side is confident in its analysis of how those ripple effects would play out.

But the biggest threat to Obama’s reelection chances comes not from the Middle East; it comes from Europe, where financial instability could lead to another recession. Greece’s teetering economy is being bailed out in small increments, in exchange for major austerity measures negotiated by the European Central Bank, Germany, and France. But election years in the United States can bring governing to a grinding halt, and Greece is no different. Legislative elections set for April or May could put austerity negotiations on hold, jeopardizing the delicate task of restructuring the Greek economy.

And though they have moved off the front pages, the financial situations in Italy, Spain, and Portugal remain precarious. The interconnected global economy means any disaster in Europe, no matter how contained, would reverberate here. Every bit of bad news in Athens leads to a bad day on Wall Street.

In all three cases, there is little an incumbent president can do to alleviate these looming threats in the short run. Even if the federal government were to allow offshore oil drilling and the Keystone XL pipeline, it would be years until the additional capacity reached U.S. markets; short of opening the Strategic Petroleum Reserve, Obama has few options that would lead directly to lower gas prices. If Israel decides its window of opportunity to delay Iran’s nuclear ambitions is closing, there is little Obama can do to convince Prime Minister Benjamin Netanyahu to hold off, while political pressure back home could force the United States to back its special ally. And the success—or failure—of the Greek recovery lies more in Angela Merkel’s hands than in Obama’s, putting a major factor in the future of the U.S. economy’s rebound out of White House control.

Democrats felt good about Obama’s prospects in February. But political reality—and the realities of the limits of the presidency—temper their moods. The known unknowns that will cloud the next eight months mean neither side can be assured of victory, no matter how bright the latest poll seems.

This article appears in the March 15, 2012, edition of National Journal Daily.

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