What can we learn from the 1988 election? - InvestingChannel

What can we learn from the 1988 election?

Most people who follow politics understand that the South “flipped” from the Dems to the GOP during the decades after the 1964 Civil Rights bill was signed.  You can see that the realignment was pretty far along by 1988, when Dukakis only won 10 states, almost all in the North (plus one border state and Hawaii):

screen-shot-2016-10-20-at-1-32-01-pmI’m not sure if people are as aware that these sorts of changes keep occurring, even in this election.  Thus California and West Virginia flipped more recently (in opposite directions.)  Vermont voted for Bush in 1988!

Iowa may be the most recent flip.  Not only did Dukakis win Iowa in 1988, he won by double digits, even more than in his home state of Massachusetts.  I think it’s fair to say that Clinton won’t do better in Iowa than in Massachusetts!

Indeed as recently as 2012, Obama won Iowa by 6%, that’s more than his 4% margin in the overall election.  But even as Hillary leads this election by 6% or 7%, polls have her trailing in Iowa.  To be fair, the betting markets have the state a tossup, and the polls are a bit out of date.  But even a tossup is a significant change from 2012.  That result would be 7% more GOP than average, vs. 2% more Democrat than average in 2012.  A 9% swing to the red.

Note that Iowa is not a rust belt state.  Its unemployment rate peaked at only 6.6% during the Great Recession, and is now down to 3.8%. Minnesota is expected to go Democratic this time, but by less than usual.

Since Trump does especially well among older voters, there must be large numbers of Iowa Trump supporters who pulled the lever for Dukakis in 1988.  I’d be interested in someone doing a good sociological study of these voters.  Talk to them, and ask them how they migrated from supporting a cerebral limousine liberal in 1988 to a dumb right-wing populist nationalist today.  (OK, don’t say “dumb” to them.) Those positions are about as far apart as you can get.  There aren’t that many immigrants in Iowa, and foreign trade benefits Iowa.  What’s the key issue?  Is it a cultural realignment?  The big cities versus small towns?  (Immigrants are 4.9% of Iowa’s population, vs. 13.3% nationally.)

These realignments will keep happening.  I mentioned how the South flipped to the GOP, but Virginia has already flipped back, and North Carolina is starting to move back.  Even Texas is gradually getting bluer.  If we are moving to a big cities vs. small towns split then Texas will continue to trend blue, but will Maine then move red?  Trump is doing better in Maine than expected.

These trends tell me that if the GOP is to rebuild, it will probably be in the Midwest.  Iowa and Ohio are two of the states that are clearly trending red, but the close polls in Minnesota tells me that the entire region is edging that way. If Hillary is doing poorly (as I expect) a mainstream Republican might be able to win the Midwest in 2002.  I also expect to eventually see a realignment of racial groups, but I’m not sure when and how.

All we know for sure is that the map 50 years from now will look very different from today—shockingly different.  But how?

PS.  This same phenomenon is happening in Europe, often in similar ways (big cities and educated people trending left, and small towns and rust belts trending right.)

PPS.  Texas and Florida now have 38 and 29 electoral votes, while Pennsylvania’s dropped down to 20 and Ohio to 18.  Iowa dropped from 8 to 6.

PPPS.  I have a new post on the EMH (it’s even better than I thought) over at Econlog.