As the 2020 presidential election moves closer day-by-day, Donald Trump is starting to show his desperation. The polls do not look good for him. Still, there is a predictor that can reveal the winner and has forecast every presidential Electoral College win since 1948 — even Trump in 2016. Oxford Economics released its report Wednesday with dire news for the man in the Oval Office.
The economy was the president’s ace in the hole until the coronavirus pandemic pounded the economic security out of the US. Unemployment just went up another 2.4 million to nearly reach 40 million unemployed Americans. That was the real indicator of how well the economy was rolling.
The nation’s economy pivots upon Americans’ consumption, but people have been staying home and keeping their dollars close. The GDP is “collapsing,” according to CNN Business:
‘History shows that dreadful economic trends like these spell doom for sitting presidents seeking reelection.’
A national election model, the Oxford Economics report just predicted Trump’s “historic defeat.” The organization has been the world leader in “forecasting and analytics. It developed a brilliant “state-based model” just last year that would have predicted all electoral college victories and “seven of the nine prior elections — since 1980.
It uses disposable income, inflation, and unemployment in its formula. The result shows Trump losing “in a landslide, capturing just 35 percent of the popular vote.”
In its report, Oxford Economics wites:
‘It would take nothing short of an economic miracle for pocketbooks to favor Trump…nearly insurmountable obstacle for Trump come November.’
This national election model assumes that the economy will not improve by fall and will have a 13 percent or above unemployment rate. It also assumes that “real per capita income” stays down six percent and prices continue to plummet (deflation).
Oxford Economics reports reads:
‘The economy would still be in a worse state than at the depth of the Great Depression.’
The group has another state-based election model. It folds in local economic trends and gas prices. This model predicts that the sitting president loses the electoral college by 328 to 210. Seven battleground states will turn blue: Iowa, Michigan, Missouri, North Carolina, Ohio, Pennsylvania, and Wisconsin:
‘We would expect these states to experience significant economic contractions and traumatic job losses that would likely swing pocketbook vote.’
The model has never considered a pandemic before, and Chief US Policy Strategist at AGF Investments Greg Valliere said:
‘Traditional models work in normal times. But we’re not in normal times right now.’
Since this winter the unemployment rate has dropped by 20 percent with a 40 percent GDP collapse. Valliere said former Vice President Joe Biden would probably win should the election be held today. He said:
‘No one can go negative like Donald Trump.’
There are limitations to the latest model. It does not consider noneconomic factors such as the presidential candidate’s likeability, agenda, or shifts in the pandemic.
CNN reported that according to this report, “this election may be a referendum on Trump’s handling of the crisis:”
‘If new infections really pick up, people will conclude Trump opened the country too soon. But if new infections drop, Trump will get some credit.’
Washington Policy Analyst at Raymond James, Ed Mills, said:
‘Every incumbent president facing a recession in the lead-up to reelection has lost. The real debate is what does the economy look like on Election Day? Will the country have gotten past the worst of Covid-19 and the worst of the economic shock?’
That means, if Biden wins and the Senate goes blue, investors will be concerned about tax increases on big business and the upper one percent, gas and oil restrictions, and more financial regulation.
Eurasia Group analysts sent out a report with a warning:
‘In almost every area where Trump has undone former President Obama’s legacy. A Biden presidency would try and restore the policy positions of the Obama administration and in most cases go beyond it.’
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