August and September were the weakest months in Obama's presidency, at least as measured by his job approval numbers. However, in October Obama seems to be making a comeback even as the economy takes a turn for the worse and as Democrats try to cram through Congress a deeply unpopular Health Care reform.
Despite the embarrassment of losing the Olympics to Rio and winning the Nobel Peace Prize though nominated only eleven days into his presidency, Obama's approval rating have stabilized and even begun to tick up. This is happening even though 57% of the American public believes that the country is on the wrong track. What can possibly explain this dissonance?
One explanation is that while Obama tears down the country in its current state, and downplays expectations for the near term, he promises a long-off better, fairer and more just future. So it could be that people are still holding out hope for a long-off socialist paradise where everyone gets along, shares the wealth and enjoys the fruits of socialism like they do in Cuba.
This is an unlikely explanation. The electorate is not stupid. Most Americans know such a socialist utopia can't possibly exist.
A better explanation for this dissonance can be found in the nature and psychology of man. A study written by two economists at the World Bank addresses the question, "Who wants to redistribute?" The authors, Martin Ravallion and Michael Loshkin start from the premise that poor people will support redistribution and rich people will oppose it. This premise seems to make sense at least from a static perspective. Poor people want to take from the rich and rich people want to keep what they have. But the economy is not static. The economy is a dynamic system, where expectations about the future matter.
The authors offer a refinement of the premise and form the hypothesis that people on a rising income trajectory will oppose redistribution and those with a downward trajectory will support redistribution. In other words, your attitude toward redistribution is not affected by where you start from, but where you think you're going.
What if a sizeable majority feels their individual incomes will decline in the future? It seems that the nation will support more redistribution. This is the argument presented by Jude Wanniski in the book The Way the World Works over thirty years ago. When a nation is in economic decline, the electorate will support redistribution. When the nation is in a phase of economic growth, the electorate will oppose redistribution.
As long as people believe their personal wealth is on a downward trajectory, people will support redistributive policies. Obama and the Democrats will continue to benefit from these diminished expectations unless and until the attitude and expectations about the health of the economy and the trajectory of personal wealth change.
So, how can the Republicans and the conservative opposition of Obama help change these expectations?
First, the Republicans must highlight personal stories of economic success in these tough times. This would resuscitate positive expectations about the economy. This would show people that even in these times of economic malaise, there are entrepreneurs who are succeeding. This would motivate and inspire people to achieve success.
We should all take note that the Democrats aren't highlighting stories of personal success or of entrepreneurs, unless that success is tied to some government program or subsidy. The only successful businesses Democrats promote are those with ties to Green Energy programs, solar panels, or windmills. This is no accident as it builds the psychology of diminished expectations. Such talk only promotes the idea that business (and the individual) cannot succeed without government oversight and assistance.
Second, Republicans must explain how Obama's policies are lowering personal wealth and keeping the nation's economy on a downward trajectory. The GOP and the conservative movement must explain that redistribution makes some people better off in the short run, but hurts every one over the long haul when all of those redistributed resources are allocated to less productive ends. The conservative movement has done a good job of explaining these ideas, but the Republican Party has not yet been able to articulate them.
Finally, Republicans must promote policies that are going to make it easier for individuals to succeed on their own. They must argue for across the board tax cuts and getting rid of excessive regulation. But they must argue for better opportunity for those who have been crushed by the burden of government assistance. They must support charter schools and school vouchers for parents stuck with sticking their children in underperforming, dangerous, and decaying schools. Further, Republicans must highlight the personal success stories of people who have overcome these obstacles.
The conservative opposition to Obama and the Democrats must change individual expectations about the downward trajectory of the economy. This is what Reagan was able to do. This is the playbook for taking back the White House. In changing the public's expectations about the economy, they will build opposition to the redistributive policies of Obama and the Democrats.