President Trump is on a fast track to an easy reelection. That’s the conclusion reached by economic forecasters — despite headlines from Washington that suggest Trump’s political fortunes are only pointed south as he battles an encroaching impeachment inquiry and Republican defections over his handling of the Syrian crisis.
Moody’s Analytics projects the president will win handily next year if the economy doesn’t badly stumble — and in fact, rack up a greater margin in the electoral college than the 304-to-227 victory he secured against Hillary Clinton in 2016.
“If the economy a year from now is the same as it is today, or roughly so, then the power of incumbency is strong and Trump’s election odds are very good, particularly if Democrats aren’t enthusiastic and don’t get out to vote,” Mark Zandi, chief economist at Moody’s Analytics and co-author of the paper outlining the findings, tells CNBC’s Brian Schwartz. “It’s about turnout.” (I laid out an argument against this kind of modeling here).
But assuming average Democratic turnout, the firm projects the 2020 map will look like this:
The finding jibes with those of other forecasting models that rely on measures of the economy’s strength to predict which major party’s candidate will win the White House next. Oxford Economics sees Trump winning 55 percent of the popular vote next year barring a “significant downturn” in the economy.
“While a wide range of issues have influenced presidential elections over the last few decades, from health care and foreign policy, to taxation and government spending, one factor has been constant: It’s the economy, stupid,” Greg Daco and James Watson, two senior economists with the firm, wrote last week.
And by the reckoning of the firm’s model, three key economic indicators — unemployment, inflation and real disposable income growth — all favor Trump’s reelection. They outweigh a “negative exhaustion factor” with Trump that dents his support in the projection.
Daco and Watson acknowledge the economy isn’t everything. But their model, which leans on it, accurately predicts all but two popular vote outcomes going back to 1948. See their results here:
They point to two key caveats that could hamstring their model’s accuracy this time. It “excludes noneconomic factors about a candidate’s record that are vital in most elections” and “pays no attention to candidates’ attributes such as race, gender or ‘likeability’ — a factor that may be centrally important in 2020.” And a severe recession, “potentially triggered by a combination of rising tariffs, declining profit margins and an adverse financial market shock,” could also turn the projection against Trump’s reelection.
Another model, assembled by Trend Macrolytics, accurately predicts every presidential victor back to 1952 by focusing on the effects of the economy and incumbency on the electoral college, according to Donald Luskin, the firm’s chief investment officer. It projects Trump will win reelection next year with 354 electoral votes — a margin that seems staggering on its face. “To get something that high, you have to go back to Ronald Reagan, and that may not be possible in the red-blue world we live in now,” Luskin tells me.
The model stakes first-term incumbents with a heavy advantage. (That edge curdles into a disadvantage for candidates running to extend their party’s hold on the White House into a third or fourth term. See: George H.W. Bush in 1992 or Al Gore in 2000.) And then it factors in six economic indicators, including oil prices, personal income, inflation and tax burdens.
One seemingly important measure the model doesn’t include: The president’s approval rating. Luskin says it actually doesn’t carry much predictive power. And besides, Trump’s remains in the middle of the pack for presidents around the 1,000-day mark in their first term:
Of his own model’s projection, Luskin says “it is directionally correct, and I’m willing to put real money that Trump is going to be reelected, assuming all the model inputs are the same as they are today.” But he adds that “you and I and Mark Zandi should take a humility pill here. We still live in a world of imponderables, and these are very rough navigation tools.”