Back in 1992, James Carville famously coined the phrase “It’s the economy, stupid” when discussing how the American public ultimately decides to vote in presidential elections.
Generally that phrase has held true ever since.
A strong, or at least improving, economy will generally result in the re-election of an incumbent (or a candidate from the same party being elected if it is an open election year).
A weak or declining economy typically results in a change of power.
The 2020 election will follow along the same lines, perhaps just on a smaller scale than we are accustomed to seeing.
Many Americans still possess scars from the economic collapse back in 2008 and thus view the economy as one of the most important factor in determining their vote.
A year or two ago this would have resulted in a landslide victory for Trump.
But as we head into 2020…not so much.
During 2019 we had 2.3% GDP growth, including 2.1% growth in the fourth quarter. This was below expectations and the slowest annual economic growth we have seen in four years.
Expectations for 2020 currently stand at 1.8% growth. So, even if we meet expectations and do not come in lower, as we did in 2019, this would be the slowest annual economic growth we have seen in nine years.
On top of that, we also ran a $1.09 trillion budget deficit in 2019 which was our largest deficit in a decade.
The projected budget deficit for 2020 is at $1.1 trillion – this is right around the Obama deficits produced during 2009-2011 when we were coming out of the worst recession this nation had seen since the Great Depression.
These are not particularly strong economic indicators for Trump as we head into the 2020 election season.
That being said, there the 2020 electorate is a bit different to anything we have seen before.
These are not the Republican and Democratic parties of the past. Voters from both parties have taken almost cult-like positions in their respective corners and will likely vote for the candidate with an “R” or “D” next to their name no matter what.
So this essentially leaves a small portion of the population currently residing somewhere between the two parties that will decide the 2020 presidential election.
These are folks that care more about their personal everyday lives than they do about political parties.
They care about their families, their finances, their jobs, their vacations and just their overall quality of life.
If these folks see any threat whatsoever from a declining economy, they will likely lean more towards the other party, which in this case would be the democratic side.
So while the economy may not sway the 2020 election in large numbers like it used to due to the cult-like nature of our current political parties, it will likely at least sway the middle of the road voters enough to determine the outcome in November.
2020 is a new year and a whole new political world, but it’s still the economy, stupid.