Election 2012: President Obama at the Mercy of U.S. Economy

U.S. President Barack Obama's chances for re-election in 2012 are increasingly tied to the fate of the U.S. economy, poll results show.

Meanwhile, presumptive Republican nominee Mitt Romney hasn't gotten as much benefit from the weak economy as one would expect – a sign of his inability to connect with voters.

The past month has not been kind to the U.S. economy – or President Obama's standing in the polls.

The barrage of bad news has included:

• An uptick in unemployment from 8.1% to 8.2%;
• A 700-plus point drop in the Dow Jones Industrial Average since May 1;
• A reduction in the U.S. Federal Reserve 2012 economic growth forecast by half a percentage point;
• And a deflating Labor Department announcement that just 69,000 jobs were created in May.

"The economy is going through a rough patch, and that more than anything is going to determine President Obama's future," said Ipsos pollster Chris Jackson in comments on a Reuters/Ipsos poll taken in early June. "People's unhappiness with the economy carries over pretty directly to the president's numbers, and we see those weakening."

In that poll, President Obama's job approval rating slipped from 50% in May to 47%, and those saying the country is on the wrong track jumped 6 points to 68%.

Meanwhile, Romney gained 6 percentage points in the head-to-head matchup, making the Election 2012 race a statistical dead heat (Obama 45%, Romney 44%).

Although President Obama's argument that he inherited economic problems too severe to fix in three years resonates with his liberal base, the moderates and independents likely to decide who sits in the Oval Office next year aren't so sure.

In that Reuters poll, the president's approval rating among independent voters plunged from 48% to 35%. And that was just over one month.

"Independents are especially susceptible to economic pressures, which is why we see them bouncing all over the place in their approval of the president," Jackson said. "The finding that he is not doing that well with them this month is something for Obama to worry about."

Election 2012: Romney's Conundrum

But the polls show Romney has reason to worry as well. Given the sorry state of the U.S. economy, one would expect Mitt Romney to be leading the president.

Yet Romney remains an underdog in the Election 2012 race.

For one thing, voters simply like President Obama better than Romney.

A June poll by the Pew Research Center showed that only 41% of voters view Romney favorably, compared to 50% for President Obama. And when asked who better connects with ordinary Americans, 59% pick the president; just 28% pick Romney.

In fact, voters rank President Obama well ahead of Romney in categories ranging from "Good judgment in a crisis" to "Willing to take an unpopular stand." Romney only prevails when voters are asked who would do a better job of improving the economy (see chart).

That means if the U.S. economy starts to show any signs of life before November, voters will likely stick with President Obama.

And while a tanking economy could deliver the White House to Romney, a safer plan would be to figure out how to better connect with voters.

Otherwise, Romney's strategy hinges on using the lousy economy as a political truncheon, which plays right into the "insensitive rich guy" image that Romney needs to shed.

That's a dicey proposition. Already last week Democrats were accusing Romney of "rooting" for bad economic news.

U.S. Economy Top Issue

One thing that's clear from the polls is that voters consider economic issues by far the most important in the Election 2012 race.

In the Pew poll, jobs was named the top concern by 35% of the respondents. Coming in second was the federal budget deficit at 23%. Healthcare was third (19%), Social Security fourth (11%) and immigration fifth (5%).

Voters also hold a very bleak view of the overall U.S. economy. In a recent Associated Press-Gfk poll, two out of three described the economy as "poor."

That should be an opportunity for both candidates to win votes by selling their visions to fix the economy.

Admittedly that's a bit more of a challenge for an incumbent president who has struggled to do just that for more than three years. But as a Republican, Romney is saddled with the legacy of President George W. Bush, under whom the economic crisis began.

What's more, after years of partisan bickering and inaction in Washington, many Americans are skeptical either man can fix the U.S. economy.

"I think we are on the wrong track," Doss Comer, an independent voter who lives in Jacksonville, NC, told the Associated Press. "We're not getting anywhere. We're not growing. The unemployment rate just spiked up again."

But he went on: "I don't trust Romney because of what he's doing. He's telling his business experience, that he was an investor in business. … I don't think he has the right background any more than Obama."

Related Articles and News:

• Money Morning:
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• Money Morning:
  Obamanomics: What You Can Expect if President Obama Wins the Election
• Money Morning:
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• Bloomberg News:
  Obama Leads in Poll as Voters View Romney as Out of Touch
• Pew Research Center:
  GOP Holds Early Turnout Edge, But Little Enthusiasm for Romney
• Associated Press/GfK:
  June 2012 Poll Results
• Time Swampland:
  Obama Campaign: Mitt Romney Is ‘Rooting’ for a Worse Economy
• The Hill:
  Poll: Obama holds lead, majority of voters say Romney ‘out of touch'
• The Hill:
  Poll: Weak economy hits Obama approval rating

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