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Thomas Ferguson: Electoral results show huge disparity in voting patterns based on income

I want to direct you to a post at the Institute for Public Accuracy that features political economy commentator Tom Ferguson because his analysis of exit polls is interesting. What he has picked up on is that the big divide in the 2012 vote was on income-based voting. Tom says:

“Now look at the exit poll in today’s New York Times. Yes, indeed, Obama did very well among women, Latinos, and African-Americans. But in sharp contrast to 2008, the partisan split along income lines is huge. Obama’s vote percentage declines in straight line fashion as income rises. He got 63 percent of the votes of Americans making less than $30,000 and 57 percent of those making between $30,000 and $50,000. Above $50,000, the Other America kicks in. Romney won 53 percent of the votes of Americans making between $50 and a $100 thousand and 54 percent of the votes of Americans making above $100,000. The Democrats’ poor showing in the House elections — they way under-performed for a party that had lost so many seats two years before — probably reflects a substantial Republican advantage in money, including the famous Superpacs, some of which poured resources into Congressional races. It was surely also affected by the White House’s reluctance to spend time and resources trying to elect Democratic House candidates. As the President negotiates for a Grand Bargain in the face of the Fiscal Cliff, these are realities that are worth pondering.”

I don’t know what implication Tom believes this electoral skew will have on the Fiscal Cliff discussions, but my view is that political inertia favours Republicans’ continued adherence to the deficit hawk position. As I have been saying for a while now about the euro zone, policy makers are loathe to abandon positions they have staked out which they believe they can defend and that resonate with their voting base. We have seen this with Germany’s response to the euro zone crisis. The same applies in the US. The Republican party has already staked out the deficit hawk position and they are not likely to give ground on it, in my view. A Grand Bargain that sees deficit reduction via social security and medicare cuts is likely. But let’s see what happens.

One friend who follows these issues told me privately that he believes this an historic election, mostly for the income-based voting gap. He said he believes that the political and economic elite have been able to align lower and middle class whites with them electorally despite espousing a platform of redistribution to the top – lower capital gains taxes, lower income tax tiers, deregulation, and so on. They have accomplished this by focusing on social issues that resonate with those groups. His view is that “if this had been a squeaker maybe one couldn’t draw conclusions.” But the Obama victory was so large, especially on income-based voting, that we may see a change in the Republican party in political positioning. As I said regarding the Fiscal Cliff, I am sceptical that this would occur decisively and quickly but I did want to put it out there.

I’ll leave you with these parting thoughts from my friend:

The demographics and trends in cultural change will just keep tipping the electorate toward the new coalition. Their positions are as deep seated as the social conservatives. Obama and the Dems did this with the considerable headwind of eight percent unemployment.

What this means to me is that the coalition of the top one percent and the social conservatives that would go with them even though it hurt them economically is now in relative decline. The Koch brothers no longer have a sufficient bloc of fools they can manipulate to achieve their ends. They had on their side Citizens United. They had eight percent unemployment…

One can criticize Obama for being too much of a compromiser, which I think he is. But it took a very clever and effective politician to pull it off. 

About 

Edward Harrison is the founder of Credit Writedowns and a former career diplomat, investment banker and technology executive with over twenty years of business experience. He is also a regular economic and financial commentator on BBC World News, CNBC Television, Business News Network, CBC, Fox Television and RT Television. He speaks six languages and reads another five, skills he uses to provide a more global perspective. Edward holds an MBA in Finance from Columbia University and a BA in Economics from Dartmouth College. Edward also writes a premium financial newsletter. Sign up here for a free trial.

4 Comments

  1. David_Lazarus says:

    If you add in the trend for stagnating wages and the destruction of the Middle class by conservative policies you will eventually see the slow and gradual eradication of the GOP.

  2. @jporter says:

    The country’s changing demographics will definitely require some rethinking on the part of the Republicans as the social conservative community they have counted on is aging and shrinking. Another interesting thing I noticed in the exit poll data was the strong support for President Obama among voters who identified themselves as moderate. Given the unemployment level and challenging economic conditions I think this is telling. A shrinking circle of social conservatives and an inability to court moderate voters is going to present a serious challenge for the GOP if they can’t overcome that political inertia and adjust their positions. And as you say, that’s something politicians are often loathe to do.

  3. Tom Usher says:

    “…clever and effective”? I say sinister. Also, the popular vote was fairly close. It was tight in many swing states with large electoral college votes. Furthermore, Obama actually received 13% less in the popular number than he did for his first term. I don’t consider his win either huge or even much of a mandate.

    I see more people being realists, realizing that they are really disenfranchised due to selfishness up and down the line.

    He’s going to hit some really low approval numbers. Many who voted for him are going to have buyer’s regret, not that they will be regretting they didn’t vote for Romney but that they voted at all.

    Sure, there were third-party candidates, but the system is so utterly corrupt that mammon simply won’t allow those people anywhere near the real levers of power. It’s going to take a mass revelation or revolution. Which will it be, or will the American people continue taking it?