Wednesday, August 8, 2012

Who's Going to Win in November?

Well, it seems that we have a real cottage industry in this country built entirely on predicting who is going to win in November. Turn on any of the news channels and within a few minutes you are sure to hear someone, somewhere make a prediction of how the election will turn out -and if you don't like what that person predicts, just change channels and wait, someone else is sure to come along in a few minutes and make a prediction closer to your liking.

Some of the most accurate predictions in recent races have been coming from our academics.  In one case a U.S. academic has penned a complex equation -- using data on the economy and presidential approval ratings -- that predicted who won the most votes in the last six presidential contests.

Naturally, as the election draws closer, pundits and journalists are scrambling and looking at all sorts of data, from persistently high jobless rates to the latest polls in the politically divided state of Ohio, for clues on Obama's chances of defeating Mitt Romney for the Presidency. But at a few U.S. universities, academics have boiled the art of prediction down to a science. Some claim their forecasts in presidential elections -- typically issued months before Election Day -- have been more accurate than opinion polls taken the day before ballots are cast. They plug decades of data into spreadsheets and try to calculate everything from how much a bad economy is hurting an incumbent to how the results of New Hampshire's presidential primaries, conducted 10 months before an election, can signal who the eventual winner will be.

So far this year, forecasters in line with many current opinion polls see Obama squeaking out a victory over Romney. In a Reuters poll of nine leading forecasters, the median prediction was for Obama to win 50.5 percent of the vote. Although under our complicated system here in America, that would not necessarily mean victory because the winner is determined by the results in the Electoral College. -And in an election that close, more bad reports on the economy, such as the data released last Friday that showed U.S. economic growth slowed sharply between April and June, could easily shift forecasts to a Romney victory.

A few models already suggest that the sour U.S. economy will be enough to boot Obama from the White House.

Three years after emerging from a deep recession, the economy has not recovered. The unemployment rate has been stuck above 8 percent for 41 months -- nearly Obama's entire time in office. For his model, University of Iowa professor Michael Lewis-Beck looks at decades of data on job creation and presidential approval. His preliminary forecast, made with Charles Tien of the City University of New York, gives Obama 46.9 percent of the vote and Romney 53.1 percent.

In the last four presidential contests, more than 90 percent of leading forecasters picked the popular vote winner. And therein lies a big caveat to their track record: Every major forecaster correctly predicted that Democrat Al Gore would win the popular vote over Republican George W. Bush in 2000. But, Gore lost the election because he came up short in the Electoral College.

Under U.S. rules for the presidential election, each state is worth a certain number of electoral votes, based on population. The first candidate to win 270 electoral votes wins the election, regardless of the popular vote. Several forecasters acknowledged that because a tight race is expected this year, they could come very close to estimating the vote tally for each candidate, but still get the winner wrong.

In other words, the only way to be sure who will win the Presidency in November is to check the results the day after the election.....

Live Long and Prosper....

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