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N2K: Redistricting Forces Incumbents to Face Off in Iowa

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April 25, 2011, 1:56 p.m.

Salt Lake Tribune en­dorsed UT Al­co­hol & Bev. Con­trol Com­mis. chair/deli chain own­er Sam Granato‘s (D), writ­ing that “the eco­nomy is the biggest con­cern of Utahns and all Amer­ic­ans. At this crit­ic­al time, it makes sense to send a man to the Sen­ate who is one of those small busi­ness people that every­one is al­ways pay­ing lip ser­vice to.” While Granato’s a Dem, “don’t read too much in­to the party la­bel.” Granato “wants more tax cuts for small busi­ness” and “says the fed­er­al health care re­form law is a ‘good start,’ but more must be done to con­tain costs.”

Want More On This Race? Check out the Hot­line Dash­board for a com­pre­hens­ive run­down of this race, in­clud­ing stor­ies, polls, ads, FEC num­bers, and more!

Ex-Jon Hunts­man gen. coun­sel Mike Lee (R) is “a rad­ic­al, hard-right Re­pub­lic­an law­yer whose policy stands flow from his ex­trem­ist read­ing of the Con­sti­tu­tion. … Granato hopes to ac­com­plish the re­turn to ci­vil­ity in polit­ics that Amer­ic­ans say they want. We be­lieve he would work with mem­bers of both parties. That’s an­oth­er reas­on he de­serves Utahns’ sup­port on Elec­tion Day” (10/9).

Sen. Bob Ben­nett‘s (R) son Jim Ben­nett is “squar­ing off against” Lee, work­ing for Granato’s camp. Still, J. Ben­nett in­sists “his de­fec­tion” to the Dems “and cam­paign­ing against the man who de­railed his fath­er’s ca­reer is not per­son­al.” J. Ben­nett: “I’m not ticked off at Mike Lee, and cer­tainly my fath­er is not ticked off at Mike Lee; he’s en­dorsed him.”

Granato, on J. Ben­nett: “He’s helped tre­mend­ously. He knows my cam­paign is closer to what his fath­er’s would be.”

Mean­while, “the story of how” J. Ben­nett “came aboard has already achieved fable status” in the Granato camp. After B. Ben­nett lost at the state GOP con­vo., J. Ben­nett “logged in­to” Granato’s Face­book fan page “and clicked ‘Like’ in the com­ments box.” Granato mgr. Marla Kennedy “saw the post” and gave J. Ben­nett “a call” (Ben­son, Deser­et News, 10/7).

A little less than 11 months from now, Amer­ic­ans will de­cide wheth­er to re­new Pres­id­ent Obama’s con­tract for an­oth­er four years. Un­less an event or a set of cir­cum­stances sud­denly makes na­tion­al se­cur­ity the fo­cus, the out­come will ride on the eco­nomy and wheth­er a ma­jor­ity of Amer­ic­ans pos­sess suf­fi­cient hope that the state of the na­tion is chan­ging for the bet­ter. Or, more ac­cur­ately, wheth­er the eco­nomy and the state of the na­tion are more likely to change for the bet­ter if Obama is reelec­ted. Hope and change were the op­er­at­ive themes in 2008, and they may well be again in 2012. The ques­tion this time, though, is wheth­er voters feel hope­ful enough that things are chan­ging for the bet­ter.

Ob­vi­ously, noth­ing is ever quite that cut and dried. If Re­pub­lic­ans nom­in­ate someone whom swing voters find un­pal­at­able, or if the GOP nom­in­ee self-de­structs, Obama will be­ne­fit. But, gen­er­ally speak­ing, when a pres­id­ent is seek­ing reelec­tion, the cam­paign is usu­ally more about the in­cum­bent than the chal­lenger, and the eco­nomy is the over­arch­ing is­sue.

Con­ven­tion­al wis­dom says that the eco­nomy will im­prove little over the next year and that the un­em­ploy­ment rate will not sig­ni­fic­antly de­cline, pro­du­cing strong polit­ic­al head­winds for Obama and his reelec­tion hopes. Al­though the fin­an­cial crisis and the en­su­ing eco­nom­ic prob­lems pre­ceded Obama’s in­aug­ur­a­tion, he now owns the eco­nomy — un­fairly or not.

The drop in the un­em­ploy­ment rate from 9 per­cent in Oc­to­ber to 8.6 per­cent in Novem­ber raises the le­git­im­ate ques­tion of wheth­er the pic­ture is bright­en­ing for the eco­nomy and the in­cum­bent. Some ana­lysts noted the sim­il­ar­ity between Novem­ber’s 8.6 per­cent un­em­ploy­ment rate and the 8.5 per­cent job­less rate in Novem­ber 1983, a year be­fore Pres­id­ent Re­agan won reelec­tion in a 49-state land­slide. Un­em­ploy­ment had been a bit worse for Re­agan earli­er in his first term than it was for Obama, 10.8 per­cent for the former com­pared with 10.1 per­cent for the lat­ter. Re­agan got to en­joy a strong “V” shaped re­cov­ery where un­em­ploy­ment fell to 7.2 per­cent by Elec­tion Day. But no eco­nom­ists an­ti­cip­ate such a swift re­cov­ery now.

Al­though eco­nom­ic fore­cast­ing is more per­il­ous than polit­ic­al pro­gnost­ic­at­ing, the con­sensus among eco­nom­ists is that the em­ploy­ment situ­ation is not im­prov­ing very much. In Decem­ber’s Blue Chip Eco­nom­ic In­dic­at­ors sur­vey of 55 top eco­nom­ists, the av­er­age fore­cast for un­em­ploy­ment in 2012 is 8.8 per­cent. The 10 most op­tim­ist­ic pro­jec­ted an 8.4 per­cent an­nu­al rate, while the 10 most pess­im­ist­ic said 9.2 per­cent. Drilling down a bit more, the con­sensus is that un­em­ploy­ment will av­er­age 8.8 per­cent for this cur­rent quarter and stay at that level for the first two quar­ters of 2012. Then eco­nom­ists ex­pect a slight im­prove­ment of one-tenth of a point in the third quarter of 2012 — the three months lead­ing in­to the elec­tion — at 8.7 per­cent (the 10 most op­tim­ist­ic, 8.3 per­cent; the 10 most pess­im­ist­ic, 9.2 per­cent); and for the fourth quarter the av­er­age was 8.6 per­cent (the bears say­ing 8.1 per­cent; the bulls, 9.2 per­cent).

Thus, the con­sensus is that un­em­ploy­ment won’t move as much as the Novem­ber rate sug­gests, that Obama will see only a slight im­prove­ment in the job­less fig­ures over the next few months, and that by the time of the elec­tion, the rate will be about where we already are. More broadly, the pros ex­pect the U.S. to ex­per­i­ence de­cent eco­nom­ic growth in this cur­rent quarter, about 2.7 per­cent, then slow down to 1.9 per­cent in the first quarter of next year, go up a touch to 2.1 per­cent in the second quarter, up an­oth­er touch to 2.3 per­cent in the third quarter, and then rise to 2.6 per­cent in the fourth quarter of next year.

The dy­nam­ics of this down­turn are far more chal­len­ging than your typ­ic­al, run-of-the-mill re­ces­sion-re­cov­ery cycle. Hous­ing usu­ally leads re­cov­er­ies, but this time the real-es­tate mar­ket is ex­acer­bat­ing the prob­lems. On top of all the do­mest­ic woes is the European fin­an­cial crisis, with many eco­nom­ists fear­ing that the Con­tin­ent may have already entered a re­ces­sion. Thus a myri­ad of prob­lems are pre­vent­ing the kind of eco­nom­ic re­bound that boos­ted Re­agan’s reelec­tion.

Which way will this pres­id­en­tial race go? One clue will be the Decem­ber un­em­ploy­ment fig­ures, to be re­leased on Jan. 6. Watch for wheth­er Novem­ber’s 8.6 rate is re­vised up­ward and if the Decem­ber num­bers con­firm or re­pu­di­ate the re­vised Novem­ber num­bers. The fig­ures will go a long way in de­term­in­ing Obama’s chances.


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