WPA January 2012 National Political Assessment

National Political Assessment: January, 2012 Page 1

Executive SummaryObama is working against powerful general trends• Obama is less popular than other presidents at this point in his first term.• Only one president in the last 56 years has been elected with unemployment over 7%.• Most Americans are disapprove of how Obama is handling the federal deficit (62%) while the economy remains the central focus of voters.• A majority of Americans believe that the federal government is at least partly responsible for job creation.Despite their dissatisfaction with Obama, Americans remain divided on whether to trustRepublicans or Democrats• Americans are split on who to trust with the economy, their most important issue.• Americans are also very divided on the presidential election.Historically Congressional Success can be predicted by several trends• Success is very dependent on the presidential campaign.• Recent success has also closely followed the generic ballot in the months leading up to the general election.Neither party will be able to rely on general trend to carry the election for them. 2012 willcome down to convincing Americans that our party has the solutions needed to fix theeconomy. Page 2

Executive SummaryKey Issue Opinions• 55% believe the economy is the most important issue.• 71% of Americans believe that the federal government plays at least a moderate role or more in job creation.• 60% believe cutting services should be the primary focus of legislators trying to cut the deficit. Page 3

ContentsGENERAL ENVIRONMENT •PG 5THE ECONOMY •PG 8THE DEFICIT AND THE DEBT •PG 15CONGRESSIONAL RACES •PG 21 Page 4

GENERAL ENVIRONMENT Page 5

Nearly two out of three Americans say that the country is headed in the wrong direction. This has been a generally consistent sentiment for the bulk of President Obama’s term in office. Direction of the Country100%90% November 9, 2008 June 13, 201080% April 6, 2009 64%70% 63% 61%60% 48%50%40% January 9, 2012 45%30% 33% 32% 32%20%10% 0% Right Direction Wrong Direction Source: Reuters/Ipsos Polls Page 6

Barack Obama’s job approval rating is below that of any of his four immediate predecessors at the same time in their Administrations. President Job Approval Monthly Averages100%90%80%70% 62%60% 54% Reagan 52% 53%50% 46% George H.W. Bush 43% George W. Bush40% 45% 47% Clinton30% Obama20%10% 0% 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 Months into Presidency Source: Roper Center Public Opinion Archives & Real Clear Politics Page 7

THE ECONOMY Page 8

The economy remains the dominant issue for most Americans. Most Important Issue Facing the Country Economy and jobs 55% Politicians/Government 5%Budget deficit/National debt 4% Partisan politics 2% Moral/Family values 2% Health care 2% President Obama 2% Education 2% Misc. social issues 2% Other 21% Unsure 3% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Source: CBS News Poll (Jan 4-8, 2012) Page 9

The national unemployment rate has decreased but remains well above eight percent. National Unemployment Rate Trend12.0%10.0% 8.0% January 2011 8.5% 6.0% 4.0% 2.0% 0.0% National Source: Bureau of Labor Statistics Page 10

Only one President (Reagan) has been re-elected in the last 56 years with unemployment over 7% and none have lost with unemployment below 6%. Correlation: -0.63 Incumbent President Vote Difference and November National Unemployment Rate 8.0% 1992 1980 1984 7.0% 6.0%National Unemployment Rate 2004 1972 5.0% 1996 1956 1964 4.0% 3.0% 2.0% 1.0% 0.0% -15% -10% -5% 0% 5% 10% 15% 20% 25% Incumbent President Vote Difference Source: WPA Analysis Page 11

Most American’s believe that the federal government plays at least some role in the creation of jobs in the United States."How much do you think the federal government can do to create jobs in the United States?" Nothing at all 9% A great deal 27% Only a little 20% Quite a bit A moderate amount 15% 29% Source: AP-GfK (Poll Dec 8-12) Page 12

However, Republicans are not trusted significantly more than Democrats on the economy. American’s are not convinced that either party is offering real solutions. "Who do you trust to do a better job of handling the economy?"100%90%80%70%60% 47% 49% 43% 44%50% 45% 43% 45%40% 40% 41% 42% 40% 38% 41%30% 38%20%10% 0% Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Republicans Democrats • Source: AP-GfK Poll (Dec 8-12) Page 13

Summary• The economy is the dominant issue and will be going into the 2012 elections.• The general trends and environment look bad for the President. o Unemployment has increased since he took office and most Americans believe the federal government is at least partially responsible for creating jobs. o Historically this is a losing combination for incumbents.• However, despite Democrats control of the Presidency and the Senate, voters are torn on which party to trust more. The over-arching trends are not necessarily indicative of a Republican victory. Page 14

THE DEFICIT AND THE DEBT Page 15

The 2011 budget deficit is over 3 times larger than it was in 2003. Federal Budget Deficit/Surplus (In Billions)-2,000-1,800 -1,703 -1,550-1,600-1,400-1,200-1,000 -800 -538 -600 -434 -400 -321 -222 -259 -192 -200 -69 -121 -103 -9 -15 -40 0 200 86 Source: Office of Management and Budget (http://www.whitehouse.gov/sites/default/files/omb/budget/fy2012/assets/hist01z1.xls) Page 16

A majority of voters disapprove of the way President Obama is handling the federal budget deficit. Obama Approval - Federal Budget Deficit100%90%80%70% 61% 59% 62% 60% 63% 64% 62% 56% 58% 56% 58% 57%60% 52% 52% 54% 56% 52% 49% 51% 48% 51% 48%50% 47% 41% 39% 40% 40% 41% 40% 39% 41% 40% 36% 38% 37% 37% 38% 36% 36%40% 34% 35% 35% 35% 33%30%20%10% 0% 4/20/2009 10/5/2009 1/17/2010 5/11/2010 9/13/2010 1/10/2011 6/20/2011 12/12/2011 Approve Disapprove • Source: AP-GfK Polls Page 17

Most voters believe cutting services should be the focus of lawmakers instead of increasing taxes. "In order to balance the federal budget, which should be the primary focus of lawmakers?"100%90%80%70% 62% 60% 59%60% 53% 55%50%40% 34% 34% 30% 29% 31%30%20%10% 0% November, 2010 Mar-11 Aug-11 Oct-11 Dec-11 Cutting services Increasing taxes • Source: AP-GfK Poll (Dec 8-12, 2011) Page 18

Summary• Voters are clearly not happy with how the President has handled the deficit.• Voters would prefer to see services cut instead of taxes increased.• Despite voter unhappiness with the economy and how the administration has handled events, Republicans are not necessarily favored. There is also a populist sentiment against the wealthy that the administration will likely play toward. Page 19

CONGRESSIONAL RACES Page 20

The generic Congressional ballot, in the few months prior to the election, have been consistent in predicting the outcome of the election. 2004 Generic Congressional Ballot 2006 Generic Congressional Ballot100% 100%80% 80% 49% 53% 51% 49% 54%60% 43% 49% 47% 60%40% 40% 40% 45% 44% 47% 43% 46%20% 20% 39% 36% 0% 0% 9/3/2004 10/5/2004 11/1/2004 11/2/2004 9/2/2006 10/6/2006 11/5/2006 11/7/2006 Republican Democrat Republican Democrat 2008 Generic Congressional Ballot 2010 Generic Congressional Ballot100% 100% 80% 80% 50% 54% 53% 53% 53% 55% 52% 60% 48% 60% 40% 40% 45% 41% 43% 40% 40% 40% 45% 20% 36% 20% 0% 0% 9/3/2008 10/5/2008 11/2/2008 11/4/2008 9/2/2010 10/3/2010 10/31/2010 11/2/2010 Republican Democrat Republican Democrat • Source: Real Clear Politics Page 21

Several months away the Democrats have a slight advantage on the generic ballot. 2011-2012 Generic Congressional Ballot100%90%80%70%60% 46% 47%50% 43% 44%40% 43% 44% 44% 40%30%20%10% 0% 24-Oct-11 24-Nov-11 24-Dec-11 Republicans Democrats • Source: Real Clear Politics Page 22

The top of the ticket is critical in Presidential years. If Obama’s prospects don’t improve, the chances of Democrats making up much ground in the House are dim. Correlation: 0.65 Incumbent President Vote Difference & Seats Gained in Congress 50 1964 40President’s Political Party Congressional Seat Gain 30 1944 20 1936 1984 1992 2004 10 1940 1972 1956 0 -15% -10% -5% 0% 5% 10% 15% 20% 25% 30% -10 1996 -20 -30 -40 1980 -50 -60 Incumbent President Vote Difference • Source: WPA Analysis Page 23

Democrats have to defend 20 Senate seats in 2012 along with the two independent but Democrat-leaning seats. Republicans have less than half that with only 10 seats to defend. Republicans have a bigopportunity to pick up several Senate seats to retake control of both houses of Congress. Dark Blue: Democratic Incumbent Light Blue: Retiring Democrat Light Red: Retiring Republican Dark Red: Republican Incumbent Page 24

The latest polling from states with a Democrat Senator show that Nebraska, Missouri, Montana, and Wisconsin are potential Republican pickups. Retiring Democrats Pollster Dates % Republican %Democrat GOP Advantage Connecticut (I) Public Policy Polling 9/22 – 9/25 43% 50% -7% Hawaii Ward Research 10/13 – 10/16 45% 43% +2% New Mexico Public Policy Polling 12/10 – 12/12 40% 47% -7% Virginia Quinnipiac 12/13 – 12/19 44% 42% +2% Wisconsin Rasmussen 10/26 49% 42% +7%Incumbent Democrats California Public Policy Polling 11/130– 11/13 38% 53% -15% Florida Quinnipiac 1/4 – 1/8 40% 41% -2% Maryland Public Policy Polling 7/10 – 7/12 33% 51% -18% Michigan EPIC-MRA 11/13 – 11/16 42% 48% -6% Minnesota Public Policy Polling 12/4 – 12/5 38% 56% -18% Missouri Public Policy Polling 11/9 47% 45% +2% Montana Public Policy Polling 11/28 – 11/30 47% 45% +2% Nebraska Magellan Strategies 1/10 – 1/11 51% 40% +11% New Jersey Fairleigh Dickinson Univ. 1/2 – 1/8 31% 43% -12% Ohio Public Policy Polling 11/4 – 11/6 34% 49% -15% Pennsylvania Public Policy Polling 11/17 – 11/20 36% 47% -11% Rhode Island Public Policy Polling 2/16 – 2/22 28% 44% -16% Vermont (I) Public Policy Polling 7/28 – 7/31 34% 60% -26% Washington Public Policy Polling 11/21 – 11/23 39% 51% -12% West Virginia Public Policy Polling 9/30 – 10/2 38% 49% -11% Page 25

For additional information about this or any other of our services, please feel free to contact: Bryon Allen Chris Wilson Chris Perkins Partner and COO Partner and CEO Partner 202.470.6300 405.286.6500 202.494.3084 E-mail: E-mail: E-mail:BAllen@WPAResearch.com CWilson@WPAResearch.com CPerkins@WPAResearch.com Page 26

WPA January 2012 National Political Assessment

by Wilson Perkins Allen Opinion Research on Jan 23, 2012

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