Yesterday, Mitt Romney officially declared his candidacy for President of the United States.
Because the Republican Party has traditionally supported the candidate it presumes has “paid the most dues”, it is likely that Romney will secure the Republican nomination.
On the one hand, Romney has some attractive qualities. For one, he looks Presidential. He also has decades of experience turning around businesses. For an economy with 9.0% unemployment, this expertise will be a valuable asset in the general election.
On the other hand, Romneycare has been a complete disaster. After the program’s implementation, healthcare costs now consume more than 30% of Massachusetts’ budget. Romney also has a well-earned reputation as a flip-flopper, which he will likely find hard to shake in the general election.
I would wish Romney luck if I thought it might help. But I don’t.
Reflections of a Rational Republican 
I think Romney could turn health care into a plus in the general election (though it’ll hurt him in the primaries). He can say that he was willing to try to guarantee health care and it taught some valuable lessons that he thinks the Democrats have not yet learned. That could play well with independents. On the other hand, he has to get through the primaries — even there the far right’s bark is worse than it’s bite. McCain was persona non grata to many on the far right after the immigration fight, but he still got the nomination rather easily. Still, Romney might be a GOP version of Mondale in 1984 — to establishment to offer a strong rationale for change. In that case, Obama’s re-election will depend more on the economy than his opponent.
After today’s employment news, I think Obama’s chances regardless of opponent, are falling fast. No sitting President since FDR has won re-election with >7.2% unemployment and Obama is no sitting at 9.1% with little runway left. Okun’s law won’t save him unless the country has China-like GDP growth.
Well, last month jobs looked good, this month they were down. It’s too early to make long term predictions based on a single stat — but each month it gets more important. Obama’s approval numbers are still surprisingly high, and people remember that the economy was at its worst at the end of the Bush years. That doesn’t save Obama, but it probably adds a variable to the analysis — he might be “the first President since FDR to win re-election with >7.2% unemployment.”
I agree that it is too early to tell. However, unemployment was at 7.3% in Bush’s last full month of office and now we are at 9.1%. GDP growth is at least positive now. In my view, fair or not, Obama’s fate hinges on unemployment and I don’t think the economy will create enough jobs to get to 7.2% by then. If Romney makes it through the primary, the one issue where he will dominate Obama is the economy.
I put Obama’s chances now at less than 50% against any candidate but Palin. Just a guess, though.
Also, Nate Silver has a couple interesting takes on economic models:
http://fivethirtyeight.blogs.nytimes.com/2011/06/03/what-do-economic-models-really-tell-us-about-elections/#more-11187
The post before that one he talks about unemployment. He notes that Reagan’s 18% victory range at 7.2% unemployment certainly meant he could have won with far higher unemployment numbers. In any event 2012 should be a fascinating election.