Ugly duckling presidents and black swan economics

Ugly duckling presidents and black swan economics
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Despite critics’ hope that President TrumpDonald TrumpTrump defends indicted GOP congressman House to vote Thursday on holding Bannon in contempt Youngkin calls for investigation into Loudoun County School Board amid sexual assault allegations MORE cannot survive a coronavirus-weakened economy, survival precedents exist. Americans are indeed unforgiving to presidents running on bad economies. However, they have forgiven “black swan” economic events. Now, Trump must hope Americans continue to see coronavirus just uniquely. 

Entering 2020, the economy was President Trump’s re-election highlight. Good in its own right, it was great compared to President Obama’s. It had left Democrats flummoxed and flailing, going from unsuccessfully claiming it was bad, to trying to give Obama credit for it. Then came coronavirus. 

Large parts of the economy are essentially shut and large-scale unemployment is the result. Job losses are just a leading indicator and more bad news awaits. Any recovery likely will lag too.  


Suddenly, the economy has gone from Trump’s best weapon to his Achilles heel. 

There are few things Americans are less willing to forgive a president for than a weak economy. Since 1916, only three elected incumbents (Herbert Hoover in 1932, Jimmy CarterJimmy CarterThe root of Joe Biden's troubles Was US-China engagement premised on Chinese political liberalization? Pat Robertson steps down as '700 Club' host after 60 years MORE in 1976 and George H. W. Bush in 1992) have lost re-election; real GDP contracted within a year of each loss. Democrats now look forward to Trump joining those ranks. 

As hard as today’s economy is being hit, and harsh as incumbents’ records with bad economies are, two precedents show this president could survive this economy. 

In 1948, President Harry Truman became the only president in the last 100 years to win re-election with a GDP contraction within a year of his re-election. In a famous come-from-behind win, he rallied past Thomas Dewey, garnering 49.4 to 45 percent in the popular vote. 

In 2002, President George W. Bush and Republicans avoided the usual midterm malaise of losing congressional seats while holding the White House — despite the economy being flat (a one percent increase) and GDP contracting in two of the year’s quarters. Bush and Republicans gained one Senate and eight House seats. In comparison, in their first midterms, Bush’s predecessor, Bill ClintonWilliam (Bill) Jefferson ClintonThe Memo: Powell ended up on losing side of GOP fight A pandemic of hyper-hypocrisy is infecting American politics Is Wall Street serving its own interests by supporting China's? MORE, lost nine Senate and 54 House seats, while his successor, Obama, lost six Senate and 63 House seats.  

Both these past presidencies and economic shocks are applicable to current circumstances. 

Neither president was overwhelmingly popular. Truman had inherited the White House and was widely seen as not up to the job. George W. Bush, like Trump, won the presidency, despite losing the popular vote.

Both economic contractions had clear external elements. The 1947 economic contraction was due to the continuing wind-down from full-scale WWII production — 1945 and 1946 also saw contractions. In 2001, the notable event was the 9/11 terrorist attack, which shrank Q3 GDP by 1.7 percent and held Q4 to just a 1.1 percent rise.  

In addition to both economic events being externally attributable, they were deemed unavoidable — certainly beyond either president’s control. 

The 1948 and 2002 elections show that even “ugly duckling presidents” can overcome economic hits — so long as those are deemed by the public to be “black swan” events. Both serve as powerful precedents now. 


That neither Truman nor Bush were overwhelmingly popular prior to their economic hits — Bush lost the popular vote and Truman did not win at all in his own right, nor did either win decisive re-election victories — argues Trump’s current political situation is hardly untenable.

Neither Truman nor Bush used large pre-existing political capital to ride out an economic hit. Of course, Trump also lacks it. His job approval ratings have resided in the 40s throughout his presidency. Current indications are that November will be close too. 

Coronavirus’s 2020 economic impact also qualitatively resembles those of 1948 and 2002, and it is even more unique in its global impact.

These aspects of coronavirus show why Democrats are focusing so hard on President Trump’s response to it. Coronavirus’s black swan origin is crucial for allowing Trump to join Truman and Bush as unlikely economic survivors. Stuck with the origin, Democrats must discredit the response.

However, Democrats have their own liabilities. There is a serious question whether they have, or will, go too far left to remain credible alternatives to Trump in the current crisis. Further, Dewey in 1948 was a more conventional threat to Truman, than Biden is to Trump — yet Dewey still lost.

Crises do not necessarily welcome radical reform — especially in American politics. They have not in the past; instead, America’s urge has been to return to stability.   

Coronavirus and its resulting economic impact are unprecedented. However, that unprecedented nature is what raises politically relevant precedents. As the past clearly shows, ugly duckling presidents have survived black swan economics.  President Trump could too.  

J.T. Young served under President George W. Bush as the director of communications in the Office of Management and Budget and as deputy assistant secretary in legislative affairs for tax and budget at the Treasury Department. He served as a congressional staffer from 1987 through 2000.