Monday, November 08, 2004

Analyzing Election Results

Kevin Drum with some crude but insightful analysis:
Finally, his [Bush's] support was up by 10 points in urban areas and down by 2 points in rural communities, including a surprising 9 point decrease from residents of small towns. This goes against a whole bunch of conventional wisdom (including mine) about the growing urban/rural divide in America. If anything, it seems to have narrowed in this election.
That is strange indeed. Goes against what I previously thought. On the economy, there were some big surprises also:
Check this out: more people think the economy is doing well today than thought so in 2000. And among people who think the economy is in good shape, a stunning 87% voted for Bush. Among that same group in 2000, only 48% voted for the "incumbent," Al Gore. Bush apparently has done a great job of persuading people who think the economy is doing well that his policies were responsible.
Compared to 2000, fewer people personally think they're doing better but more people believe the economy is in good shape anyway. And Bush was overwhelmingly successful in convincing those people that his policies deserved the credit.
If this is true then one thing is very clear: Republicans are much, much better at understanding and appealing to the voters. I for one could never imagine that anobody would buy the Bush camp's "we saved the economy with our tax cuts" argument. I suspect most other "liberals" thought the same thing (as do economists). Yet Republicans managed to convince lots of voters. Amazing.

By know we pretty much know what will happen in Iraq: There will be more violence, then gradual stabilization leading to a western-friendly, semi-autocratic regime headed by Allawi or somebody like him. We know what will happen with terrorism: No more "lucky breaks" for the terrorists like 9/11, some minor attacks, hopefully nobody smuggles in a nuclear bomb, we'll learn to "live with it" just like the Spanish live with the ETA, and it will look more like law enforcement and less like "war". Those Bush supporters who think he's "the man" when it comes to fighting terrorists will continue to think so. They already defy reality and you really can't argue it one way or the other (since the terrorist threat is unprecedented and we have nothing to compare it to).

What we DON'T know is what will happen with the economy. House prices may collapse. The dollar will most certainly go down, question is how fast and how far. Growth/productivity may stall or decline. This is what will decide Bush's re-election in 2008. I'm sticking with my original guess: Something bad will happen to the economy or the financial markets.

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