COVID-19 Upends the 2020 Presidential Race BY MARK ZANDI

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COVID-19 Upends the 2020 Presidential Race BY MARK ZANDI AND BERNARD YAROS

https://www.moodysanalytics.com/-/media/artic...ion-update

President Trump has gone from the clear favorite to win the 2020 presidential election to the underdog. As recently as February, nearly everything seemed to be going Trump’s way. He was presiding over a strong economy. The stock market was breaking records. Even the impeachment inquiry seemed to have boosted Trump’s approval rating, which hit an all-time best shortly after his Senate acquittal in early February.

However, COVID-19 has since knocked the president off his glide path to reelection. The U.S. plunged into recession during March and April. Although this would be the shortest recession since before the Civil War, it will likely go down in history as the most severe, with real GDP forecast to decline by 11% between the fourth quarter of 2019 and the second quarter of 2020. More than 20 million Americans lost their jobs at the peak in April, and the unemployment rate remains higher than it was at the worst of the Great Recession.

Consumer sentiment has plummeted, irrespective of political party affiliation (see Chart 1). Consequently, approval of Trump’s handling of the economy is under water for the first time since before the Tax Cuts and Jobs Act was passed.

His overall approval has been further hobbled by his response to the coronavirus and the nationwide protests sparked by the death of George Floyd. Moody’s Analytics has updated its 2020 presidential election models, which we introduced in September.

1 The reversal in our election projections could not be more striking. We predict the pandemic has near-singlehandedly cost Trump more than 100 Electoral College votes. In the three battleground states of Pennsylvania, Michigan and Wisconsin, the outbreak has cost the president more than 800,000 votes, equivalent to 4% of registered voters in these three swing states.

This article will first lay out our predictions for the Electoral College in 2020 and review the underlying political and economic factors behind our state election projections. 1 See M. Zandi, D. White and B. Yaros, “Our 2020 Presidential Election Models,” Regional Financial Review (September 2019): 11-22. This article is publicly accessible at:

https://www.economy.com/economicview/analysis/376675.

We will then take a deeper dive into three battleground states that wrong-footed pollsters and propelled Trump to victory in 2016: Pennsylvania, Michigan and Wisconsin.

In this section, we will discuss our county-level election forecasts in these three must-win states and point out which of their counties will be key in determining the 2020 winner.

The article will conclude with potential wild cards for the 2020 election. And the winner is… Moody’s Analytics predicts that former Vice President Joe Biden will defeat Trump on Election Day, with 308 electoral votes to the president’s 230 votes (see Chart 2 and Appendix 1). Biden would hold on to all states that former Secretary of State Hillary Clinton won in 2016, while picking up Pennsylvania,

What will happen in 2020?

Moody’s Analytics predicts that Biden will sweep all three swing states with a margin of 151,237 in Pennsylvania, 321,089 in Michigan, and 251,628 in Wisconsin (see Chart 13). These results assume only average nonincumbent party turnout, and they represent a significant turnaround for Democrats from our pre-pandemic forecasts in which Trump had the upper hand.

The pandemic has cost Trump more than 228,031 votes in Pennsylvania, equivalent to 3% of registered voters, as a result of political disillusionment with the status quo stemming from lower personal incomes and higher unemployment

(see Appendix 5). Prior to the pandemic, we had forecast that if nonincumbent turnout was average, Trump would carry Pennsylvania with a margin of 76,794 votes, which would have been close to double his 2016 margin of victory in the Keystone State (see Appendix 6).

At the time, we projected that no Pennsylvanian county would have seen its unemployment rate. rise more than three-tenths of a percentage point from the first to the third quarter of 2020 (see Appendix 7). Since the pandemic, we now forecast that Pennsylvania’s counties will see their unemployment rates rise by at least a full percentage point to as many as 4 percentage points over the same period.

The deterioration in economic conditions due to the pandemic is expected to cost Trump Erie County and to drive as many as 40,000 additional Democratic votes in Philadelphia County and up to 20,000 extra Democratic votes in Allegheny County and Montgomery County (see Appendix 8) . COVID-19 will cost Trump an even greater 406,331 votes in Michigan, equivalent to 5% of registered voters.

Prior to the pandemic, we expected that if nonincumbent turnout was typical, Trump would have won the Wolverine State by a margin of 85,242 votes, more than eight times his 2016 winning margin (see Appendix 9). At the time, we forecast that most Michigan counties would experience no change in their unemployment rates from the first to the third quarter of 2020 (see Appendix 10). Because of the pandemic, we now see Michigan’s county unemployment rates rising between 2 and 7 percentage points over the same period.

Because of the dramatic turn in economic conditions, Biden will flip Saginaw County and Leelanau County while benefiting from 85,000 extra votes in Wayne County and 62,000 additional votes in Oakland County (see Appendix 11). Meanwhile, Trump will garner 46,600 fewer votes in Macomb County, a white working-class suburb of Detroit, which he flipped in 2016 and played a major role in his upset over Clinton in Michigan
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