Obama faces his own political 'headwind' on the economy

President Obama is enjoying his best favorability ratings in months. But polls show Americans are worried and mad about the economy – a fact that's a major challenge to Obama's reelection bid.

As he looks ahead to his reelection fight, President Obama should be feeling pretty good.

His approval rating is at a 16-month high (53 percent, according to the latest from Gallup). He’s marshalling an impressive team of campaign professionals deployed around the country, plus a fund-raising capability that is historic. And Republicans – so far, at least – seem to be less than thrilled with their lot of hopefuls, some of whom have pulled out and some of whom carry high negatives among the general voting public.

But Obama faces a major hurdle to reelection: the state of the US economy, in particular the increasingly sour political mood as a result.

According to a Newsweek/Daily Beast poll, Americans are mad as heck about the US economy, and they don’t think much of Obama’s response.

Among the numbers: By nearly four-to-one, Americans say government is not solving the nation’s economic problems; 70 percent are nervous about their retirement; about one-quarter say their family’s economic situation has impacted their health or marriage (most say adversely); and Obama gets bad grades on reducing the deficit, cutting spending, and balancing the federal budget – that is, people don’t think he has a real plan to remedy those issues seen as critical to economic recovery.

“Reality is beginning to break down Americans' normally optimistic attitude,” writes political strategist Douglas Schoen in an analysis of the results he gathered. “Three-quarters of our respondents think the country is on the wrong track. A majority say the anxiety wrought by this recession has caused relationship problems and sleep deficiency. Two-thirds even report being angry at God.”

The only solace Obama might find in this poll is that Americans are no less down on Republicans.

“Our poll respondents say the GOP is just laying the blame on Obama rather than making their own positive proposals, 58 percent to 29 percent,” writes Schoen. (Also, by a wide 68-27 percent margin, respondents support raising taxes on the wealthy to help balance the budget – essentially Obama’s position.)

Those poll results, it’s worth noting, came before last week’s bad news on employment – that the economy added just 54,000 jobs in May and the unemployment rate rose to 9.1 percent.

Housing another major political challenge

Meanwhile, the housing situation is another challenge for the Obama administration. As the Monitor’s Mark Trumbull wrote last week, credit is tight for would-be buyers, uncertainty runs high, and the supply of homes for sale is huge.

“The foreclosure wave may have already peaked, but the numbers of loans in serious delinquency remain at historically high levels,” Trumbull reported.

Other reports echo that view.

“The house price collapse is now worse than it was during the Great Depression,” writes Brett Arends, senior columnist for MarketWatch and a personal-finance columnist for the Wall Street Journal. “It’s yet more proof that the nationwide financial bust is far worse than Wall Street is pretending, and it may be getting worse instead of better.”

That’s not a comforting thought for Obama.

The lesson of FDR

In recent days, much has been made of the correlation between joblessness and the chances that an incumbent president can be reelected – that “no American president since Franklin Delano Roosevelt has won a second term in office when the unemployment rate on Election Day topped 7.2 percent,” as Binyamin Appelbaum of the New York Times put it.

Some observers question that line of thinking. After all, they point out, FDR was reelected with double-digit unemployment rates in 1936 (16.6 percent) and 1940 (14.6 percent). Still, the trend was improving during those Great Depression years, and Obama took office when the unemployment was “just” 7.8 percent.

Not surprisingly, administration officials accentuate the positive – that the nation’s economic “headwind” is caused in part by gas prices, the earthquake and tsunami in Japan, and unease about the European fiscal situation.

"What we know is that we have moved a long way from when the economy was in a rescue mode, the private sector was in freefall, and the government was the only thing standing between us and falling into another great depression," Obama’s chief economic advisor Austan Goolsbee said Sunday on ABC’s “This Week.”

"Don't make too much of any one month's job report because they are highly variable," he cautioned. "After the last recession, in this comparable period, post-recession, we had lost 100,000 jobs. We've added more than two million jobs."

But it could take more than incremental improvements in the economy to reverse the angst now felt by many Americans – voting Americans. And that has to be a worry for the White House.