WITH ONE ILL-ADVISED political statement about the deadly attack on the US embassy in Libya, Mitt Romney ensured that another week would go by when the focus of the presidential campaign wasn’t on the economy. There have been many such weeks recently, with nearly as many causes — Romney’s insult to the British during the London Olympics, Clint Eastwood’s bizarre empty-chair monologue at the Republican convention. Each of these has set off an uproar, and then, just as Romney was preparing to “pivot back to the economy” — BAM! He’s reeling again.
But grim as these episodes have been for the Romney campaign, they have always been accompanied by the fortifying hope that this time, if they can just keep it together, the dreadful economy will await them at the other end. More than anything, the economy was supposed to smooth his path to the White House. His strategy from the outset assumed that the fundamentals are so weak that Obama couldn’t win reelection. No incumbent has won a second term with the unemployment rate above 7.2 percent — and Ronald Reagan only won in 1984 because the economy was recovering so rapidly from the 1982 recession.
In one sense, Romney’s assumption is likely to be vindicated: Unemployment will almost certainly be above 8 percent on Election Day, and the economy is expanding at a rate that pales in comparison to the way it was during Reagan’s campaign. But in the more important sense, this strategy is looking awfully shaky. Despite the disappointing recovery, Obama is leading the race, and by a wider margin than two weeks ago. No question the economy is bad — but that might not be good enough to elect Romney.
The Romney campaign “missed a couple things when they bought into the conventional wisdom that this would be a referendum on Obama’s handling of the economy,” says William Kristol, the editor of the conservative Weekly Standard and a former George H.W. Bush administration official, who has been pushing Romney to be more aggressive. “The economy’s not great, but it’s not horrible either. We don’t have 18 percent interest rates and gas lines around the block. And the crash came before Obama. He’s not telling an untruth that he inherited an awful mess.”
The numbers, and the public’s attitude toward them, back this up.
There may not be enough economic bad news to be good news for Romney’s campaign.
Despite the tepid jobs figure — the economy added only 96,000 jobs in August, well below forecasters’ expectations — US economic confidence shot up 11 points last week to its highest level of the year.
Gallup’s broader measure of overall American satisfaction also hit a three-year high in August of 30 percent (it was 13 percent when Obama took office).
To be sure, these are mediocre numbers. But they don’t match the awful recession Romney and most Republicans are trying to depict on the campaign trail. Instead, they reflect the economy as it really is: growing at a frustratingly slow pace, but still growing.
Put in historical context, they provide a telling glimpse at where the race stands less than two months from Election Day. As Gallup notes, satisfaction is less than it was in September 1984 (48 percent), 1996 (45 percent), and 2004 (41 percent) — all years when the incumbent president was reelected. In 1992, satisfaction stood at 22 percent, and George H.W. Bush was defeated.
Most worrisome in all this for Romney is that voters no longer regard him as the obviously superior candidate to manage the economy. A Fox News/Opinion Dynamics poll this week showed an even split between him and Obama on who would be better at “improving the economy and creating jobs.” Several other polls show a similar split.
If Romney has indeed lost this crucial advantage, then it invalidates his theory of the race and buttresses the claims of conservatives like Kristol that he’ll need to do more to win. This could explain why Romney felt compelled to make a jumpy attack on Obama’s handling of Libya — and why the race will be harder for him to win even if he does manage to get his act together.
Joshua Green is national correspondent for Bloomberg Businessweek. Follow him on Twitter @JoshuaGreen.