11/03/2008 03:21 pm ET | Updated May 25, 2011

Basic Trends: The Economy


The campaigns do the best they can under the circumstances fate has dealt them. Their campaigns may do better or worse than expected, but the basic trends provide the context of the election contest.


At the time of the 2006 election the war in Iraq was the most important problem facing the country, topping 30% and by far the dominant issue. The economy, by contrast, was under 10%. Let me repeat that: the economy was under 10%.


Improving conditions in Iraq (see previous post) started a decline in the MIP for Iraq, before views of the economy started to change. But then at the end of 2007 and start of 2008 the economy exploded as the most important problem by far.  It rapidly reached the 30%+ level the war had previously held, and has now nearly doubled that to over 50%. That dominance changed the gound on which the campaign has been fought.


The war? Now under 10%.


What about perceptions of economic conditions? The Michigan Consumer Sentiment measure is the longest running estimate of how the public views the economy, and is included in the Fed's index of leading economic indicators:


Enough said.