Is Carnage Still Trump's Key to the Electoral College?

(Bloomberg Opinion) -- “American carnage” was at the heart of Donald Trump’s successful 2016 presidential campaign. This was particularly true in hard-hit swing states, which he alluded to in his inaugural address when he described “rusted-out factories scattered like tombstones across the landscape of our nation.”

Now he is saying that “the years of economic decay are over” and heralding “the great American comeback.” Will the new rhetoric work in the crucial battleground states as the president seeks re-election?

Recall that Trump won the White House with 78,000 total votes in Michigan, Pennsylvania and Wisconsin. The performance of wages in those states likely made voters receptive to his message of American carnage. According to data from the Bureau of Labor Statistics, average weekly wages fell by 1.5%, 2.3% and 2.1% in Michigan, Pennsylvania and Wisconsin in the fourth quarter of 2016 relative to the same period the year before. Wages also fell over that period in other key election states: Florida, Maine, Minnesota, Nevada, New Hampshire and North Carolina.

It’s hard to predict how wages will perform when the election occurs in the fourth quarter of 2020. But wages have been growing in all those states, and my bet is that the trend continues. This suggests that in the places that matter, the president may be right to pivot from “carnage” to “comeback.”

Other indicators back up Trump’s new strategy, including employment and housing prices. In the fourth quarter of 2018, Michigan, Pennsylvania and Wisconsin experienced employment growth of 1%, 1.1% and 0.6%, respectively, over the same period the year before.

According to my colleagues in the AEI Housing Center, house prices were appreciating at a faster rate in 2019 than in 2016 for four of the 10 states that were the closest contests in the last presidential election. While Michigan and Florida are among the underperformers in this group, annual house prices increases in 2019 were 54% faster in Pennsylvania and 3% faster in Wisconsin than in 2016. This makes it more difficult for first-time home buyers, but it is a good thing for homeowners, and suggests that overall economic conditions in these states are improving.

Nationwide, a recent Gallup poll reports that Americans’ confidence in the economy is at a two-decade high. By contrast, confidence was trending down in 2016, during Trump’s “American carnage” phase, with 53% saying the economy was getting worse and 38% reporting that it was getting better.

In the most recent Gallup survey, only 10% of respondents mentioned the economy when asked about the most important problem facing the U.S. today. This is also at a two-decade low. During the 2016 election, the share of respondents mentioning the economy was about double today’s level.

And more than two-thirds of respondents report that now is a good time to find a quality job. In November 2016, only 43% said that, while 53% said it was a bad time.

More broadly, Americans seem content. Nine in 10 report being satisfied with how their personal lives are going — the highest percentage on record in the four decades Gallup has been asking this question.

The public is right to feel good about the economy. Unemployment is at a half-century low. A composite index from economists at Goldman Sachs suggests wages are growing at a 3.4 percent annual rate, and there are more job openings than unemployed workers.

The economy is delivering for the working-class voters Trump needs. Weekly earnings for those in the bottom 10% have grown over one-third faster than they have grown for workers in the middle. The unemployment rate for people without a high school diploma is further below its long-term average than the rate for college graduates is below its typical level. Wages for non-supervisory workers have been growing faster than average wages overall since last February.

Of course, Trump’s 2016 rhetoric wildly overstated the economic challenges facing the country. Much of his appeal — during the last campaign and during his time as president — has been based on his ability to play to people's anxieties and fears.

This raises important questions: Even if “it’s morning again in America” is the right message for the 2020 swing states and for the nation as a whole, is Trump the right messenger? Will his base respond to this new tone and disposition?

 His re-election chances may depend on the answers.

(Disclaimer: Michael Bloomberg is also seeking the Democratic presidential nomination. He is the founder and majority owner of Bloomberg LP, the parent company of Bloomberg News.)

To contact the editor responsible for this story: Katy Roberts at kroberts29@bloomberg.net

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

Michael R. Strain is a Bloomberg Opinion columnist. He is director of economic policy studies and resident scholar at the American Enterprise Institute. He is the editor of “The U.S. Labor Market: Questions and Challenges for Public Policy.”

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