Flat-Growth Battlegrounds

George W. Bush should be worried about his re-election prospects, if for no other reason than this: With less than three months to go until November 2, the economy is flatter in the states that matter.

An analysis of battleground state economies reveals that, whatever stock one puts in the President's assurances about an economy having "turned the corner," in terms of employment and income growth during Bush's term the swing states are doing worse than the country as a whole.

Lost jobs and stagnating incomes

The National Journal recently published a special feature profiling the 20 states they deem to be 2004 presidential battlegrounds. For each, the Journal reported the statewide per capita income growth and job growth rates since January 2001, when Bush took office.

The numbers are striking: Of the 20 states, only five – Arkansas, Louisiana, Maine, New Mexico and West Virginia – are doing better than the national income growth rate of 11 percent income growth since January 2001; and only six – Iowa, Louisiana, Michigan, Missouri, North Carolina and West Virginia – have outperformed the national job loss benchmark of -0.8% during the same period. Crosstabulating these 11 states yields just two – Louisiana and West Virginia – that have outperformed the nationwide averages on both measures.

More damning is the fact that, of the remaining 18 doing worse on at least one measure, fully 11 are doing worse on both, and these 11 include the "big three" swing states of Ohio, Pennsylvania and Florida (the other eight: Arizona, Colorado, Minnesota, New Hampshire, Nevada, Oregon, Washington and Wisconsin). It's as if the battleground states are experiencing an inverse Lake Wobegon effect – almost all of them are below average.

If not obvious, the point is that whatever impact the struggling economy may have on this year's election, any impacts will be more pronounced in the very states that will decide whether Bush returns or John Kerry replaces him. That said, pundits who think the economy will be trumped by war issues may want to rethink the relative impact of the economic situation in these key states.

Southwest Rising

In the Washington Post last November, I argued that the Southwest is the nascent swing region in U.S. presidential elections. Yes, the Southeast and the Midwest have far more electors. But the former Confederate states have swung already, and the Midwest's population is dwindling relative to the Sunbelt. Long term, the Southwest, with its burgeoning Hispanic population, holds the keys to the White House.

When I crosstabbed the data on income and job growth rates for the Journal's 20 battlegrounds, I made a surprising discovery that confirms my earlier suspicions. Confessing that I expected the manufacturing drain in the post-industrial Midwest states to be most demonstrable, I was shocked to discover otherwise. Based on the twin effects of both employment and income changes, the three states which have performed worst relative to national economy since January 2001 are all in the Southwest: Arizona (-7.9 percent job growth; 5.5 percent income increase), Colorado (-4.9; 1.9) and Nevada (-8.2; 3.8).

These states no doubt suffered disproportionately because of lower wages and higher unemployment rates for Latinos (6.1% in 2003) relative to whites (4.0 percent). The region's aberrant case is New Mexico, which has done relatively well, at least on income growth (16.1 percent). The state has gone Democratic in the past three presidential elections, albeit narrowly (Al Gore won by just 366 votes in 2000), following six straight Republican wins.

The real coup for Kerry, therefore, would be to pick up some of the combined 24 electors in Arizona, Colorado and Nevada. If Bush loses all three, he'll be hard pressed to compensate elsewhere.