Whom Does Economy Favor In Midwest?

There has been a basic demographic calculus to this prolonged Democratic nomination fight. In states and areas with high numbers of young, educated voters, as well as African-Americans, Sen. Barack Obama generally does well. In areas where the voters are older, less well-educated and either Hispanic or Anglo, the advantage goes to Sen. Hillary Rodham Clinton.

However, another, more overlooked factor lies in attitudes towards the economy. Relatively robust places – the farm towns and cities of the Great Plains, or the Connecticut suburbs – have been more susceptible to Obama’s broad reformer message than Clinton’s focused economic one. By contrast, in areas hardest hit by the recession, such as Ohio, Florida and Southern California, the New York senator has enjoyed a clear advantage.

This pattern has only been interrupted when racial or ethnic factors have trumped economic concerns. Broadly speaking, for many reasons, Jews and Hispanics have tilted towards Ms. Clinton; African-Americans clearly have rallied overwhelmingly to Obama.

In Indiana, African-Americans are a small (8.7 percent) minority, although far more important in the May 6 Democratic primary. Jewish and Latino voters, on the other hand, represent only tiny voting blocs. For this reason, demography and economics will play outsized roles.

Despite the usual media spin about the dying Midwest, Indiana is hard to stereotype economically. Clearly, it is not an economic disaster area like Michigan or Ohio, although one would not call it booming either. Overall, Indiana is a mild underachiever; its 18.5 percent job growth rate since 1990 stands well below Wisconsin’s healthy 28.5 percent, but well above Ohio’s 11.1 percent, not to mention the phenomenal 32.8 percent growth in the other May 6 battleground, North Carolina.

This economic growth has also impacted the state’s demography, particularly among 28- to 50-year-old educated workers. By this measurement Indiana, according to our Praxis Strategy Group analysis, does a bit better than Ohio but fared worse than either Wisconsin and far below the blow-out rates experienced by North Carolina.

Overall, Indiana’s older, downscale demographics poses many problems for Obama. The state’s percentage of educated adults – traditionally his key white constituency – stands well below Wisconsin’s and even Ohio’s. In contrast, Clinton’s blue-collar appeal is well in evidence in Indiana even if, overall, the state’s economy has been doing far better than its Midwest neighbors.

Ultimately, though, the Indiana story is really a story or regions. Well-educated Hoosiers tend to concentrate in fast growing areas around Indianapolis whose job growth more resembles a Sunbelt boomtown than a rustbelt disaster area. On the other end of spectrum, many are a series of smaller communities such as Muncie, Terre Haute, Gary and Ft. Wayne with very high concentrations of the generally older white working class residents.

These areas were probably never fertile ground for Obama. In addition, it is likely the senator’s “bitter” comments about the religious and gun-toting characteristics of small town residents, not to mention the antics of Reverend Jeremiah Wright, have not made him seem any more acceptable.

Ultimately, it is the weak economy that makes these places ideal for Clinton. Her policy prescriptions to save local industry – one might even call it pandering – works with people increasingly desperate about their place in the high-tech global economy. It is easy to see that a summer gas tax holiday as a bad policy if you are a tenured professor at Indiana University, but saving a couple of bucks on the old Ford may sound very good to people on the economy’s hard edge. 

Core Clinton country takes you to Muncie. Since 2002, the city of 67,000 has lost almost a third of its manufacturing jobs. At thesame time virtually every other sector – retail, business services, construction – are now also losing employment. The information sector has been negligible.

Like many other smaller Indiana cities, Muncie, suggests Patrick Barkey, director of economic and political studies at Ball State University, has failed to find an answer to hard times .“A lot of our towns are not showing that they are viable in the information age,” Barkey observes.

On the other end of the spectrum lies Indianapolis as well as Bloomington, the home of Indiana University, and Lafayette, where Purdue is located. Over the past decade, these places have been adding jobs well above the national average. In Indianapolis, manufacturing jobs may also be trending down, but other sectors like business services – up 20 percent since 2002 – have more than made up the slack. Information, education and health have also been on the upswing.

Bloomington, Lafayette and Indianapolis are also home to large groups of well-educated, upwardly mobile voters – their percentage of educated adults reaches close to 30 percent, almost 50 percent higher than the state average. Until recently these voters could have been expected to provide a base for Sen. Obama, along with African Americans, which could outweigh an almost certain Hillary landslide in the downscale industrial cities of the state.

However, other factors may be in play here. To be sure, college towns like Bloomington and Lafayette should be an easy roll for Obama but educated voters in heavily suburbanized Indianapolis may present a more difficult challenge. Most educated suburbanites lack the job security – not to mention the 60s style social politics – shared by college professors. This makes them more sensitive to movements in the economy. They still might be doing well, but potential instability threatens their jobs, businesses and mortgages far more directly than either students or workers in the protected non-profit sector.

For these reasons, the suburban voters in Indianapolis, which altogether accounts for over one-fourth the state population, may provide the key to the election. In contrast to the inner city, which is almost 30 percent African-American, the surrounding suburbs are overwhelmingly white and well educated. They resemble less the traditional rural Hoosier than their suburban counterparts encountered two weeks ago outside Philadelphia.

This should be a source of discomfit for the Obama strategists. White suburbs are precisely where Obama’s majority coalition, so impressive in the early primaries, now appears to be deconstructing. Bill Clinton, with his instinct for the jugular, likely knows this as well. When Sen. Clinton was fighting for her life in Pennsylvania, her husband, according to the Wall Street Journal, told her campaign “get me to the suburbs where I can make a difference”.

It is impossible to calculate the “Bill” effect but in Pennsylvania, the suburbs, even the affluent ones, ended up tilting for Clinton. Since then, the Illinois senator has been weakened further by Rev. Jeremiah Wright while Sen. Clinton’s economic focus should be playing better even with relatively affluent voters as the extent of the downturn has become obvious.

For these reasons Indiana, which once appeared to offer an excellent chance for Obama to land a final knock out blow on Sen. Clinton, might not turn out well for him at all. Until Obama can connect with increasingly anxious middle class white suburban voters, he may find his current core base of African-Americans, hardliner liberals and college students too small to win decisively. If so, it suggests the prospect not only to a considerable setback at the polls in Indiana Tuesday but also might undermine his chances in November, if he still manages to secure the nomination .

Joel Kotkin is a presidential fellow at Chapman University and author Te City: A Global History. He is writing a book on the American future. The statistical analysis comes courtesy of the Praxis Strategy Group.