Democrats' biggest concern isn't the economy; it's whether Obama has already peaked. There are numerous reasons to believe it's true. If true, there are rapidly diminishing opportunities for the Administration to reverse it, and a growing list that could accelerate it.
Pick your poll: the presidential race is a toss-up. The latest Gallup tracking poll (taken 7/22-29, 3,050 registered voters, MOE +/- 2%) has the race tied at 46% apiece. It couldn't get any tighter.
The race has been so tight for so long, that it is not news -- until we factor in campaign spending. While the focus has been on Republicans' advantage with Super PACs, the overlooked story is how much Obama has outspent Romney on campaign advertising.
The National Journal's Hotline publication has been tabulating the race's television ad buys. According to their latest calculation of 2012 advertising in thirteen swing states (CO, FL, IA, MI, MN, NV, NH, NM, NC, OH, PA, VA, and WI), Obama has outspent Romney almost three to one -- $120 million to $43 million thus far. The advantage is not only deep but broad: Obama has outspent Romney in all eleven states where either campaign has spent.
When adding in spending by outside groups, the Democrats' superiority seems to vanish. Democrats and their allies have spent $141 million, while Republicans and theirs have spent $203 million -- outspending Democrats in all states.
However the cash's quality is not equal. Democrats still hold a decided advantage for two reasons. First, Democrats have far greater control over their resources because a far greater proportion is under Obama's direct control -- not outside groups'. Second, under FEC rules, campaigns pay less for advertising airtime -- so Obama's campaign dollars go further than Republican Super PACs'.
Looking at the polls in this context, the worry should be clear: despite significantly outspending Romney, Obama has gotten no separation from him. Nor is it just Democratic spending that has assailed Romney. He weathered a long grueling primary, during which he was the constant target of all challengers.
Over this prolonged pummeling, Romney has not simply endured, he is even with the incumbent. Shouldn't the incumbent Obama, who faced no primary and was able to save, focus, and control massively more resources, have opened up a lead? Has Obama taken his best shot, while Republicans are still waiting to throw theirs?
There are several indications that this is true. Presidential reelections are about the incumbent and elected incumbents overwhelmingly win -- only Carter and Bush I have lost in the last 76 years. Because of this, winning incumbents increase their popular vote share from their initial election.
Never in U.S, history has a winning incumbent, in his initial reelection attempt, seen his popular vote percentage fall. However despite his spending and incumbency advantages, if current polls are correct Obama is unlikely to come close to reaching his 52.5% of the 2008 popular vote.
Second, in Obama's 2008 victory, most neglected to notice his win was only an electoral vote landslide and against an opponent with numerous crippling disadvantages. McCain failed to unite Republicans, while carrying the burden of two wars and an economic downturn.
Even more unnoticed was Obama's massive spending advantage. All told, McCain raised $350 million for his primary and general election campaigns, while Obama raised $745.7 million. And this huge advantage could be focused on close states -- further increasing the spending disparity.
While Obama benefitted from a huge 2008 -- and thus far in 2012 -- spending advantage, it is disappearing now. Republican Super PACs have a 3-1 cash on hand advantage over the Democrats'. Romney also is closing the gap. In May, Romney outraised Obama $77 million to $60 million and in June, Republicans raised over $100 million.
Without his huge cash advantage and with the election just over three months away, there are a diminishing number of potentially positive variables for Obama. The Fed recently downgraded the economy's projected performance and Congress' stalemate eliminates the possibility for any great political victories. Abroad too, it is easier to see things getting worse -- such as an economic collapse in Europe -- than better.
The realization should be emerging that Obama was not really that strong in 2008, when he massively outspent a disadvantaged opponent. And he is even weaker now -- despite an early and significant spending advantage -- when he will be unable to financially overwhelm a stronger opponent. The questions Democrats must be asking is: Has Obama already peaked? And can he hold on just long enough?