Swing-state unemployment down, Obama's chances up

[April 23, 2012]  WASHINGTON (AP) -- The improving economy is swinging the pendulum in President Barack Obama's favor in the 14 states where the presidential election will likely be decided.

Recent polls have shown Obama gaining an edge over his likely Republican challenger, Mitt Romney, in several so-called swing states -- those that are considered up for grabs.

What's made the difference is that unemployment has dropped more sharply in several swing states than in the nation as a whole. A resurgence in manufacturing is helping the economy -- and Obama's chances -- in the industrial Midwestern states of Ohio and Michigan.

And Arizona, Nevada and Florida, where unemployment remains high, are getting some relief from an uptick in tourism.

"The biggest reason for the president's improving prospects probably is the economy," says Peter Brown, assistant director of the Quinnipiac University Polling Institute.

The Great Recession of 2007-2009 hit several swing states particularly hard. Unemployment peaked at 14.2 percent in Michigan, where the auto industry faced ruin. It also hit double digits in Arizona, Nevada and Florida, which were at the center of the housing bust, and in North Carolina, which lost jobs in textile and furniture plants.

In 2010, the economic misery helped Republicans retake control of the House and gain seats in the Senate. But the GOP can't count on a repeat when voters return to the polls -- with much more at stake -- on Nov. 6.

After an agonizingly slow recovery, several swing-state economies are finally accelerating:

• The job market is improving in Michigan and Ohio. In Michigan, unemployment fell to 8.5 percent in March from 10.5 percent in March 2011. And in Ohio, it dropped to 7.5 percent from 8.8 percent over the same period, putting it well below the national average of 8.2 percent. A Fox News poll released Friday showed Obama leading Romney 45 percent to 39 percent among registered voters in Ohio.
  
  Many blue-collar workers in Ohio and Michigan credit the federal bailout of General Motors and Chrysler for saving tens of thousands of auto industry jobs, says Paul Allen Beck, a political science professor at Ohio State University. The bailout began under President George W. Bush, but Obama expanded it. "There's a feeling the administration went out of its way to protect jobs that are very important," Beck said.

• In Florida, unemployment tumbled to 9 percent in March from 10.7 percent a year earlier. That was more than twice the nationwide drop of 0.7 percentage point (from 8.9 percent to 8.2 percent) over the same period. A rise in tourism is helping. "People who put off vacations or a trip to Disney World for two or three years got to the point where they feel safe in terms of financial security to finally take those trips," says Sean Snaith, director of the University of Central Florida's Institute for Economic Competitiveness.

• Even Nevada, a focal point of the real estate collapse, has seen some improvement: Unemployment dropped to 12 percent in March from 13.6 percent a year earlier.

• Unemployment is down over the past year in the 10 other states the Associated Press identifies as swing states: Arizona, Colorado, Iowa, Minnesota, New Hampshire, New Mexico, North Carolina, Pennsylvania, Virginia and Wisconsin.

Still, political analysts caution that voter sentiment -- not to mention economic momentum -- can turn fast. A month before the most recent polling, for instance, Obama was running behind or neck-and-neck with Romney in battleground states.

"The election is not today; it is seven months away," Quinnipiac's Brown says.

A jobs recovery fizzled in mid-2011, so there's no guarantee the unemployment rate will continue to fall this year.

Indeed, Romney was quick to pounce after the government said job creation plunged in March after three strong months of growth. Romney called the numbers "weak and very troubling.... Millions of Americans are paying a high price for President Obama's economic policies."

Higher gasoline prices, up 60 cents this year to a national average $3.88 a gallon, could also turn voters against Obama. Still, prices have dropped over the past two weeks, and analysts say they could fall further.

Political analysts also wonder whether voters will end up holding Obama responsible for the poor state of the housing market, even if the job market has improved.

Jonathan Ketcham, a marketing professor at Arizona State University who has analyzed voting behavior, says academic studies haven't investigated how housing trends affect voters' decisions. Housing hasn't been a major issue in a presidential campaign before. But since 2006, a drop in home prices has wiped out $7 trillion in home equity, the biggest source of wealth for most families.

In Nevada, more than six in 10 homes are "underwater" -- they're worth less than the mortgages on them.

In February, foreclosures surged more in Florida's two biggest cities -- Miami and Tampa -- from February 2011 than anywhere else, according to RealtyTrac. Foreclosures are up partly because they were delayed last year by a legal fight over lenders that processed foreclosures without verifying documents.

Now, foreclosures are rising again in places like Florida where the housing bust did the most damage. That is worrisome for Obama, whose housing policies haven't made much of a dent in the crisis, says Susan MacManus, a government professor at the University of South Florida.

Then again, state economic trends might not even make much difference. Political scientists who study voter behavior say most Americans tend to base their views about the economy -- and their votes -- more on what's happening nationwide than on what's happening closer to home.

The academic findings might seem to defy common sense. But reports on the ups and downs of unemployment, gross domestic product and other nationwide economic indicators appear constantly on television news, in newspapers and on the Internet.

So in some ways, ordinary Americans hear more about the national economy than they hear about economic conditions in their own communities, says Arizona State's Ketcham. Ketcham also says it "could be that people simply understand that local conditions are beyond the reach of national politicians."

The national economic trend favors Obama, too. Unemployment is down significantly from its 10 percent peak in October 2009. No incumbent president dating to 1956 has lost when unemployment fell over the two years leading up to his re-election contest. And none has won when the rate rose.

Unemployment was 9.8 percent in November 2010.

Last month, eight months before Election Day, the rate was 8.2 percent.

[Associated Press; By PAUL WISEMAN]

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