A brightening economic picture is improving President Barack Obama’s re-election prospects even as the pace of the nation’s recovery from financial crisis remains a vulnerability for his campaign.
Public approval of Obama’s performance in office in the Gallup Organization’s daily tracking poll climbed to its highest level since last June just days after the unemployment rate dropped to 8.3 percent, the lowest in almost three years.
Announcement of the unemployment figures “appears to be the proximate cause” for the uptick in Obama’s job approval rating, which has been rising for weeks in concert with a series of favorable economic reports, Frank Newport, editor-in-chief of the Gallup Poll in Princeton, New Jersey, said yesterday after the latest poll results were released.
Obama registered 49 percent job approval and 45 percent disapproval in polling conducted Feb. 6-8, the best reading since the month after al-Qaeda leader Osama bin Laden was killed by U.S. special operations forces.
The Bloomberg Consumer Comfort Index, also released yesterday, showed confidence last week at a one-year high, spurred by improving perceptions of employment opportunities and a rally in the stock market. The reading for political independents, a key group in presidential elections, increased to a four-year high.
The benchmark Standard & Poor’s 500 index rose 7.5 percent this year through the market close yesterday.
A Labor Department report released yesterday on claims for unemployment insurance payments indicated the job market is gaining more traction. Applications for jobless benefits decreased by 15,000 in the week ended Feb. 4 to 358,000. The median forecast of 48 economists surveyed by Bloomberg News projected 370,000.
A stirring economy at the start of an election year helps frame favorable perceptions for an incumbent at a key moment if growth can be sustained, said Robert Erikson, a professor of political science at Columbia University in New York and co-author with Christopher Wlezien of “The Timeline of Presidential Elections.”
“The timing is crucial,” Erikson said, “The trajectory of the economy throughout the election year is the most important.”
After the longest period of unemployment above 8 percent since the Great Depression, the economy is the focal point of the 2012 campaign. Voters consistently tell pollsters it is the most important issue for them.
Former Massachusetts Governor Mitt Romney and the other Republican presidential candidates have cast Obama as an ineffective steward of the economy and his policies, such as the 2009 stimulus, as failures. Obama has pointed to progress on jobs and the challenge of confronting the worst recession in seven decades. He argues that Republicans would return to the policies of President George W. Bush that preceded the 2008 collapse of financial markets.
White House economic advisers as well as private forecasters in recent days have become more optimistic about the economy’s prospects.
Mark Zandi, chief economist at Moody’s Analytics in West Chester, Pennsylvania, said he lowered his projection for the unemployment rate at the end of the year a half percentage point to 7.9 percent after the recent Labor Department data.
Alan Krueger, chairman of the president’s Council of Economic Advisers, said in a statement Feb. 8 that economic projections the administration prepared in mid-November for its budget are now “stale and out of date.”
The budget proposal the Obama administration will send to Congress on Feb. 13 forecasts an average unemployment rate this year of 8.9 percent.
“We would certainly lower our forecast of the unemployment rate from the figures that will appear in Monday’s budget if we were to do another forecast today,” Krueger said in his statement.’’
Still, the economy has repeatedly shown signs of improvement early in the year only to falter later since the U.S. recession officially ended in June 2009.
A pickup in the recovery at the start of last year was blunted by a surge in gasoline prices, the earthquake and tsunami in Japan and the European debt crisis.
The economy remains vulnerable to more shocks such as a worsening of the European debt situation or another decline in housing prices, Zandi said.
“Last year we got nailed by a couple of events that in normal times we could easily have digested but everyone was so on edge it caused us to freeze,” Zandi said. “Forecasters are a bit gun-shy because last year at this time a lot of good things were happening.”