Comparing the 1992 presidential campaign to the 2012 contest, I can’t decide if it’s interesting or sad how little the politics and issues have changed over two decades.
Recall that in 1992, President George H.W. Bush ran for re-election. Despite U.S. success in kicking Saddam Hussein out of Kuwait in Operation Desert Storm, Bush failed to inherit the common sense on economic policy that his predecessor, Ronald Reagan, possessed.
During the 1988 Republican National Convention, then-Vice President Bush proclaimed: “Read my lips: No new taxes.” But in 1990, Bush reversed himself, and agreed to a budget deal featuring big tax increases. This hampered the U.S. economy, which went into recession from mid-1990 through the first quarter of 1991, and the subsequent recovery under-performed.
During the 1992 race, Bill Clinton’s political adviser James Carville famously hung up a sign in campaign headquarters that said: “Change vs. more of the same. The economy, stupid. Don’t forget health care.” Of course, Clinton, aided by third party candidate Ross Perot, beat Bush.
Ironically, when it came to taxes, Clinton provided “more of the same,” hiking taxes during his first year in office. The U.S. economic recovery continued to under-perform until mid-1996.
As for health care, HillaryCare – named for First Lady Hillary Clinton, whom President Clinton put in charge of health care reform – amounted to a massive government takeover. It was unpopular, and failed with a Democrat-controlled Congress. Combined with the Clinton tax increase, it handed control of Congress over to the Republicans in 1994.
Economic growth kicked into higher gear when Clinton worked with that Republican Congress to rein in federal spending growth and cut capital gains taxes.
Fast forward to 2012, and it’s President Barack Obama struggling to get re-elected due to one of the worst economic recoveries on record, after one of the deepest recessions since the Great Depression.
Republican challenger Mitt Romney could hang up the same exact sign in his campaign headquarters as Clinton did: “Change vs. more of the same. The economy, stupid. Don’t forget health care.”
Obama ran for the White House in 2008 on a vague notion of “change” as well. Unfortunately, his change took a very bad economic situation that he inherited, and made it far worse. Government “stimulus,” historic levels of federal government spending, regulatory activism, increased taxes, and threats of still higher taxes have, predictably, made for a failed agenda.
Not surprisingly, the president’s poll numbers consistently come up short in terms of job performance. And across all polling entities, roughly 60 percent view the country as being on the “wrong track.” This overwhelmingly is about the economy. In fact, in mid-July, only one in three Americans, according to a Rasmussen Report poll, said the economy was improving.
And then there is health care. Where Clinton failed to achieve a government takeover, Obama largely succeeded with a narrow legislative victory in March 2010. This vast expansion of government control over health care – through more regulation, increased taxes and an explosion in government spending – has been in disfavor with the American people, as illustrated in poll after poll, ever since it was signed into law.
In November 2010, Republicans picked up seats in the Senate, and regained control of the House of Representatives due to the combination of ObamaCare being passed, and the President’s other policies failing on the economy.
Now, the question becomes: What will the American people decide this November?
When incumbents seek re-election, the race overwhelmingly is about, well, the incumbent. If voters are relatively happy and content, it’s usually a smooth road to re-election. Obviously, that is not the case this year, putting Obama in a very tough spot. The last two presidents to seek re-election during tough economic times – Jimmy Carter in 1980 and George H.W. Bush in 1992 – were tossed out of office.
Make no mistake, the 2012 presidential election is not about Romney. It is about Obama.
However, Romney must do more than just saying, “I’m not him.” Rather, he still needs to show voters that, according to the campaign sign, he can bring about real change, and not just offer more of the same, when it comes to policy. He has to show that such change will make a real difference in terms of aiding the economy. And despite his own poor record on health care policy while governor of Massachusetts, Romney must assure people that he stands committed to his promise to repeal ObamaCare if elected.
Meanwhile, what can the president do to get re-elected? His challenge is more formidable given his record.
First, Obama must find a way to convince voters that things are not as bad as they are, or that they should not feel as bad as they do on the economy. Second, and this has been coming through loud and clear from the Obama campaign, the president must scare voters into not voting for Romney. Third, he can take potshots at Congress since the GOP controls the House.
Fooling and scaring people into voting for you does not make for an inspiring, positive campaign. But that’s what Obama is stuck with in trying to avoid becoming the next Jimmy Carter or George H.W. Bush.
– Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council.