Today’s economic news is that new claims for unemployment benefits have fallen again, with the four-week average now at the lowest point since spring 2008. That’s not all; the stock market is also at its highest point since spring 2008, and Gallup’s economic confidence numbers are also approaching post-recession highs.
It’s no coincidence that the run of good economic news — and employment is only a part of that — has been accompanied by a climb by Barack Obama in the polls. Indeed, the Pollster average now has Obama with an average 5.5 point lead over Romney.
The less obvious, but also important, point is that virtually everything else in our politics is affected by good economic news, too.
If it continues, expect the popularity of other policies associated with the president to improve, too. If Obama become more popular — which is one effect of good economic news — then “Obamacare” will, too. Moreover, if Members of Congress, bureaucrats, and lobbyists start assuming the president will be around for four more years, it’s easier for him to get his way in policy terms, because waiting him out suddenly becomes a much less viable strategy. That, in turn, could buoy his approval, too.
One other key point: There’s a real possibility that everyone is still being overly cautious about believing in an economic turnaround. The White House’s official numbers used to make projections in the soon-to-be-released budget are very likely far too pessimistic (for technical reasons, the Office of Management and Budget doesn’t do constant revisions of its economic forecasts and so the budget released in February includes forecasts made back in the fall).
Outside economic forecasters, too, are making projections that don’t seem to reflect the recent much better news. And even some liberal economists are emphasizing what could still go wrong and why we shouldn't get too confident — with the result that people may assume that the truth must be even worse, since liberal economists might be assumed to sugar-coat their comments when a Democrat is in the White House.
It’s certainly possible that the new economic momentum will, again, dissipate. But the signs are mounting that people are being a bit too pessimistic. And if so, there’s a chance that Democrats and the president could be about to receive a whole lot of unexpected good news indeed.