As we look forward to 2012, it’s clear that this will be a year of action and change. Over the past year, we have begun to see how public sentiment and political affairs shape and drive global economic performance. Given the ongoing shifts in public opinion, the upcoming U.S. presidential election and the growing ability of individual citizens to make their voices heard, I believe we will see the economy improve more quickly and soundly in 2012 than others have forecasted.
I’ve talked with you previously about the use of social media to influence events around the world, from the Arab Spring to Occupy Wall Street. In these situations, the global public was able to manipulate the media and incite change by cutting out the middleman and embracing democratization in its newest form. Its efforts were so successful that TIME magazine named “The Protestor” as its Person of the Year. That trend has continued to grow and evolve, and politicians with presidential aspirations have begun to take notice.
In the U.S., Mitt Romney has shifted away from promoting himself as a strict conservative, choosing instead to allow candidates like Ron Paul and Rick Santorum to jostle for votes among the far-right base. This tactic, coupled with continued allegations that Romney isn’t a “true believer” in Tea Party principles, could benefit the candidate from Massachusetts in the fight for the Republican nomination. The general public has grown tired of strict ideology of any kind, and Romney will be served well by focusing less on the party line and more on how competitive he could be against an opponent like Obama, whose most recent approval rating was only 47 percent.
This complex interplay between public opinion and politics was also evident in Republican Speaker John Boehner’s handling of the payroll tax cut, which demonstrated the capacity of a mobilized public to organize against political rhetoric and bring about immediate change. In that situation, Congress’s low public approval rating — which hovered near 11 percent at the time — helped dictate his surprising decision to agree to a short-term extension.
President Obama, meanwhile, has decided to make Congress his issue of choice. This strategy is well timed, as the economy has been improving and is likely to continue doing so to an increasingly stronger degree. According to the Wall Street Journal, the unemployment rate has dropped to 8.5 percent, the lowest since February 2009, and 1.6 million jobs were created in 2011. The global economy is clearly trending in an upward direction, and consumer confidence is journeying in the same direction. A poll by CNN and ORC International, for example, showed a significant decline in the number of people characterizing economic conditions as “very poor,” which had reached 51 percent as recently as November.
I think it’s worth asking—what is at the core of this growth? It seems clear in today’s environment, as explained by something I call the “Martin Curve,” that the public is currently playing an unprecedented role in influencing our economic fundamentals. The public — which today is broadly defined — has access to more information than ever before, and, as a result, public mood has become a leading indicator for the economy. By evaluating public sentiment on a variety of issues, we can better assess the overall health of the economy and determine where it might be headed.
For instance, during the financial crisis of 2008, when the public lost confidence in financial institutions and markets, the economy spiraled downward at an alarming pace. Now, with unemployment and financial performance showing steady improvement, the feedback loop is moving in the opposite direction.
The economy is the issue of the day — as demonstrated by the Pew Research Center’s report that the U.S. economy was the most prominent story in the American news media over the last year — and is likely to remain so for the foreseeable future. As U.S. markets continue to strengthen and grow, we may also see a dynamic shift in the same direction in Europe and other markets.
As we continue to monitor these developments, it’s important to remember that social and traditional media sources are currently enjoying an unparalleled amount of influence over worldwide political and economic developments. As the global public becomes more confident in the economy, its mood is likely to impact both economic and political outcomes on a significant scale.
If public sentiment indicates a strengthened economy, which it does, what will that mean for a Republican nominee’s chances in the general election? Such a candidate will be unable to rely on a faltering economy to differentiate himself from President Obama, thus changing the fundamental tone and substance of the campaign season.
No matter the outcome, this election will be an unquestionable demonstration of the growing relationship between public opinion, economic performance and political outcome.
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