Sunday, October 21, 2012

Fisherman's Tale: Mitt and Barack Sprint To The Finish

Fisherman’s Tale: Mitt and Barack Sprint to the Finish

Two weeks to go, three debates down, and our pair of racehorses are thundering down the stretch. 

Last Tuesday, Mr. Obama found his missing flask of espresso and managed to come up with an up-tempo performance which at least righted the listing (or listless) ship of state.  One thing seemed very clear to those of us who watched.  The Obamas and the Romneys will not be double-dating in the foreseeable future.  If you got nothing else out of the 90 minutes (and, as usual, there was a paucity of actual details) you did get to see a very revealing quality shared by both men: the capacity for cold anger. 

So, can we pick the winners and losers in November? Well, there’s an avalanche of polling going on.  If you look at the national polls on October 21, they show a very tight race-essentially a dead heat.  Except for two, the IBD/TIPP tracking poll, which has Obama up by six, and the Gallup tracking poll, which shows Romney up by seven.  Since Gallup is widely known and respected, Gallup gets all the attention, and it appears that Mitt is running away with it.  Except, maybe he’s not.

Looking deep into the Gallup numbers, you find that what really counts are “likely voters.”  So, what’s a likely voter?  Well, it depends on whom you ask, but the key seems to be the polling organization’s attempt to measure intensity and behavior.  The more intense you are (or seem to be, based on your answers to questions they deem critical indicators) the more likely you are to actually vote.  Since elections are only decided by those who show up, and polling organizations want to forecast outcomes, opinions that aren’t expressed in a ballot are essentially irrelevant.

What Gallup tries to do is to predict who will vote based on the 23 different herbs and spices (actually, 7 herbs and spices) that make up a likely voter.  They aren’t any different than any other pollster.  The WSJ/NBC just released a poll that shows it as 47/47 but with Obama having a 5% lead among all registered respondents.  In the that poll, they spoke to 1000 registered voters, and then eliminated the responses of 184 of them.  A quick back of the envelope calculation would lead one to believe that Obama had more than a 15 point lead among the “discarded” respondents-those deemed unlikely to vote. 

Is that a reasonable way to approach things?  Actually, it is, with two qualifiers.  First, the predictive model is based on past behavior as much as it is present intention, and the polling organizations haven’t fully caught up.  The explosion in the use of cell-phones, houses with no landlines, off-hour workers, single parent and non-traditional families, change the very nature of whom you can reach, where, and at what time.  So we have to ask whether the polling organizations are really talking to everyone.

The second is something for which we don’t yet have a good model.  The irrationality index is at an all time high.  Republicans love to say that Obama is the most polarizing President of all time.  He is, because many of them just absolutely hate him, and would frankly do or say anything to see him out of office.  We aren’t talking about the professional politicians for whom every race is simply about winning and who crave the spoils.  This is the gut, visceral reaction that causes perfectly normal people to say and post on line words that they might otherwise be ashamed to utter in any other context.  This intensity makes them likely voters.  Gallup’s tracking poll shows this, in part, in the geographic breakdown of the likely voters.  In three regions, East, West and Midwest, places where the communities are more diverse and have had mixed recoveries, Obama is ahead by a few points.  In the South, he is down by more than twenty points.  This astounding outperformance in the South swamps the other three, more populous regions, and gives Romney his national lead. 

This Southern tilt is fascinating.  Before we go off meandering down the darker alleyways of motivation, we should start with some basics.  On an elemental level, the solid Republican South makes sense. This is a place that is more rural, more religious, more tied to the military and a gun culture, more culturally conservative.  That makes up an important part of expected Southern support for the GOP.

Yet, this level of animus is beyond prediction, particularly because, when Southerners are voting for Romney/Ryan in particular (as opposed, say to McCain or Dubya) they are voting so much against their personal interests.  The South overwhelmingly gets more Federal dollars than it pays in taxes.  It’s home to more seniors.  It collects large farm subsidies.  There are a lot of 47 percenters there.  And, if you squeeze domestic and entitlement spending as much as the Romney/Ryan Plan projects, you would likely seriously hurt a great many Southern communities.  And yet, they flock to the Romney/Ryan banner. 

Before we pin the irrational tail too much on the elephant, let’s not forget it also belongs on the donkey.  This week a group of conservation organizations are considering a big advertising media buy--for ads critical of Mr. Obama.  He hasn’t been good enough for them, so they plan to  chip away at his environmental credentials. Turns out that Mr. Obama may be a conservationist, but he is also a politician, and some compromises are necessary.  Now, one might ask if any of these folk took math in school (Obama-1=Mitt+1).  Perhaps they act this way out of some bizarre desire to turn the entire country into an Ansell Adams’ landscape? 

Are there other losers?  Well, Gene Epstein, the very insightful Von Mises devotee and Barron’s writer of “Economic Beat” thinks Capitalism will lose. There’s very little subtlety in the title of his column this last weekend,  “Trampled in the Presidential Debate:  Adam Smith”.

Epstein ticked off bipartisan apostasies.  Both men massively flunked global trade, particularly on being aggressive with China.  Obama proudly lauded his work in beating back cheap Chinese tires, Romney tried to one up him by promising tariffs everywhere he perceives an unfair advantage over American manufacturers and messing with currency rates. Obama was taken to task for having subsidized wind energy through tax credits, Romney for quickly pandering “I appreciate the wind jobs in Iowa.”  For Mr. Epstein, who is methodical in his reasoning and apolitical, it’s a uncomfortable reminder of a painful reality.  Just as Mr. Obama is as much a politician as an environmentalist, Mr. Romney isn’t really pro-capitalism.  He’s just pro business and pro wealth. Those are not the same things.

All this actual and potential disillusionment leads me to Pushkin's poem, “The Fisherman and the Golden Fish.” In it, an old fisherman and his wife have been living in poverty for many years.  One day, he pulls out a golden fish. The fish pleads for its life, promising any wish in return. The old man, being kindly and modest in his desires, asks for nothing and releases him to the sea. When he returns home and tells his wife about the golden fish, she gets angry and tells her husband to go ask the fish for a new washboard, as theirs is broken.  The fish happily grants this small request. Each day, the wife’s demands grow greater and greater, and each day, the reluctant fisherman goes to ask the Golden Fish for more. Finally, mansions, and jewels, and wealth, and titles, and power are not enough.  She wants to be Ruler of the Seas, and to subjugate the Golden Fish to her absolute will.  When the old man makes this request, the fish ends the cycle of greed by putting the old woman back in her old cottage and giving her back the broken washboard.

You do wonder what happens if all those likely voters get their wish.