How The Economy Collapsed (As a Political Issue)

Republicans and Democrats no longer have the same facts. It's the perceptual bias, stupid.

The big issue of the 2012 election — the American economy — has been settled.

But just how it has been settled appears to depend on who you are: If you're a Democrat, it's something approaching morning in America. If you're a Republican, we're screwed.

And if you’re Mitt Romney, you find yourself — unexpectedly — searching for something new to talk about a month before the election.

This is one of the central mysteries of 2012: How did we stop focusing on the economy? Because if there was anything everyone — both campaigns, pundits of all stripes, journalists like us — agreed on, it was that the economy would be the central and decisive issue of the presidential election. A raft of polls seemed to support this: Surveys from ABC, NBC, CBS, Bloomberg, Reuters, and Rasmussen have all put “the economy” or some variation at the top of voters’ minds.

“It’s now clearer than ever that the November election will be a referendum on the economy,” former Senator Phil Gramm and economist Glenn Hubbard wrote in June, capturing the recent conventional wisdom.

So why didn't this happen? A closer look at some of that same polling data helps explain it. The most dramatic figures come from the Pew Research Center for the People & the Press, which routinely asks voters about the news they are hearing about the economy. In August of 2011, Americans of all parties said the news was mostly bad, with only minor differences showing between members of different political parties.

A year later, a survey taken in early September found a "record partisan gap." A full 60% of Republicans said they were hearing “mostly bad” news. Only 15% of Democrats reported the same. And independent voters split on the question, with 36% saying they were hearing mostly bad news.

It’s not just a matter of what voters are hearing. Gallup’s tracking of Americans’ reported confidence in the economy has also seen a dramatic divergence: Democrats’ confidence reached a new high in a survey released September 25; Republicans’ reached a record low.

An online survey by the firm CivicScience, among those that has sought to develop reliable online metrics, found that among the Romney supporters it surveyed over the last three months, 96% labeled the economy “weak.” The corresponding figure for Obama supporters is 55%, according to the company's data director, Ross McGowan.

The pattern is a familiar one to pollsters and political scientists alike, though some say it has intensified with the changing and increasingly partisan media.

“Cues and signaling from the political leaders definitely influence how people experience their own lives,” said Democratic pollster Harrison Hickman, who said he’d seen the trend “aggravated in recent years.”

He attributed the vast gaps in public polls to a mixture of that psychological factor and of poll respondents’ awareness of a “politically correct” answer.

And as a writer on the conservative blog Hot Air noted, under the headline “The reason the election is closer than you think is probably you,” this mechanism has distorted economic surveys in the past.

The landmark 1960 The American Voter, a study of the elections of 1948 through 1956, found something similar of voter attitudes toward the Korean War, speculating that when a voters’ views conflict with his party allegiance, “allegiance presumably will work to undo the contrary opinions.”

“The influence of identification on attitudes toward the perceived elements of politics has been far more important than the influence of these attitudes on party identification itself,” the authors wrote. That is: Party identification appeared, at times, to trump voters' experience of reality.

A debate over “partisan perceptual bias” has raged in the political science literature ever since, Princeton’s Larry Bartels noted that it was particularly pronounced during Ronald Reagan’s presidency, with surveys showing that “Democrats were strikingly impervious to the good economic news.” Lee Drutman noted in Slate in 2010 that something similar seemed to apply to Republicans' reporting of their own economic conditions between 2008 and 2010.

In this light, the raft of polling showing that the economy is at the top of voters minds are a distraction. “The economy” simply means different tings to different people.

At last, the presidential campaigns appear increasingly to be acknowledging they won’t change those heavily partisan perceptions. With 37 days to election day, the battlefield has shifted to issues where each side believes they can move the needle.

Indeed, the Obama campaign has long ago stopped trying to convince Americans that the economy is better than they thought, targeting their message at a “severely conservative” Romney.

And while the Romney campaign made the economy the core of their campaign earlier this year, they’ve recently diversified after struggling — mostly in vain — to persuade voters despite a steady stream of negative data points. Now, the economic argument is part of a broader case the campaign tries to make, all the while swiping at any shiny object that glitters past, whether Chinese intellectual property theft, alleged cuts to Medicare, or foreign policy crises.

The most recent Romney tack, though, is to link the economy to the deficit, which is typically seen as a less compelling issue than voters own experience.

“What has actually helped us with independent voters has been the connection we've made between the debt and deficits the president has piled up and slower economic growth and job creation,” said senior advisor Kevin Madden.

One thing the campaign is no longer simply about: The economy or, as Bill Clinton’s aides once had it, “the economy, stupid.” And even as Romney’s campaign seeks a more nuanced argument tying that economy to other issues, the partisan perceptual divide seems to be deepening.

“With the political campaign only intensifying, and the election's outcome hinging on the health of the economy, it is possible the partisan gap in economic confidence will expand further over the next several weeks,” Gallup’s Alyssa Brown wrote on September 25.

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