Black swan events make next US president difficult to predict

36 weeks from tomorrow, America will go to the polls to select a new president and a new Congress. The question I’m asked a lot by clients is who will win? Well, the answer I give is to quote, that great philosopher, Leonid Brezhnev. Actually, Brezhnev wasn’t erudite at all, he was a thug in a long reign of thugs. But he had a clever lie. He said, The trouble with free elections is you never know who’s going to win. I suppose that’s what made Brezhnev not a fan of free elections. But that may apply to this year, it’s very hard to know who the winner is going to be in November. Both candidates have unfavorable ratings more than favorable ratings, something pollsters call being underwater. Not only that there are a lot of black swan events that could happen this year, assuming that President Biden and former President Trump are the candidates. One of them is well, to be candid, the actuarial tables, there’s also a chance of political violence. And there’s legal problems. Well, that makes predicting even harder to do. One way to start on the analysis, however, is to look at the poll by Gallup on social attitudes in the US. Now, Gallup is a very famous and distinguished polling organization, but they give up the horse race kind of polling, you know, candidate X is so much, etc, things like that, to focus instead, on people’s deeper attitudes. They ask a number of questions that have a high correlation with what happens in the election. First, they ask people, are you generally better off than you worth three years ago? This year, the answer was 48 to 47. Yes. And what Gallup notes is that, generally speaking, supporters of the incumbent party say they’re better off while supporters of the other party say they’re worse off, no surprise there. One thing to keep in mind 4847 may look good for President Biden. But back in January 2000, right before the first Biden Trump faceoff people said they were better off 6136. And still, Trump went on to lose that November. Well, there are a number of other things rather than just you personally better off, which may have a lot to do with, you know, home relations and things like that. And they go into financial questions. When asked, for example, a question implicitly about inflation. Do you find it easier to buy things when you go to the store? Well, then in that case, the answer was no, by a whopping margin of 59 to 35. all demographic groups except Democrats that it was harder to afford things store. Democrats went 55 to 33, that it was easier, but they were the only group. Most people feel they’ve been hit by inflation. More generally, are you better off financially than you were last year? Well, there it goes down again, overall, it’s 35 to 47. People saying that they’re the 47, or the people who are saying they’re worse off, or no better off is the remainder. Interesting breakdown, though, here, two demographic groups, so they were better off financially, first college educated people who said they’re better off 48 to 34. They’re about a third of the electorate, and people making six figure salaries, who said they were better off 47 to 39, or about 28% of the electorate. The other two thirds of the electorate said they were worse off by margins ranging from 11 to 24%. So the broad middle class feels worse off, and that would include the lower middle class working class, whereas the top of the income distribution feels better off. I think this is clear evidence of what we have a lot of other evidence for that class differences and attitudes of different classes toward the economy. Have why Didn’t we have a widened perception of inequality in America under the less than the last three years? The other question that Gallup asks about that seems to correlate with elections, is whether or not voters think that America is more respected in the world. Now, voters are given three choices. Are we more respected, less respected, or just as respected as we were three years ago? Now, here’s bad news for President Biden. Almost no one said, we are more respected in the world than we were when Trump was in office. 27% We are said we’re as respected and 67% said we are less respected than we were three years ago. Even Democrats, they were the only demographic group split 47 as respected 44 Less respected. So the President’s own party is split. Obviously, the candidate is in trouble on that score. You know, when you think about that, we’re hearing a lot in the news that foreigners really don’t like Trump. Even Vladimir Putin said he thought Biden was better for Russia. The reason is that Trump is considered far less predictable. He Biden is much more of a traditional person. Foreigners like to deal with a predictable president. Americans, on the other hand, would rather have their president keep the other guys guessing. So in general, the attitudes that Gallup finds most important, the economy, in foreign policy suggests that the chances of President Biden being reelected, are low. But as I mentioned, there are a lot of black swan events that can happen. It’s still nine months before the election. A lot of things can happen in nine months. And this election isn’t just about policies and issues. It’s also about personality. And there, we didn’t have immediate poll results. We know there are problems with both candidates. So I think in the end, even though right now, voters are not so sure they want to reelect the incumbent. Probably Brezhnev was right. We have an election with a free election, and no one knows who’s going to win this election.