Beyond his legal problems, Donald Trump suddenly faces rising odds of becoming the first U.S. president to seek re-election during economic recession since Jimmy Carter.
Until now, Robert Mueller’s special counsel investigation has loomed as a singular threat to further erode the president’s standing. That reflects both the gravity of a probe that has produced guilty pleas from multiple Trump associates, and the robustness of growth during the first two years of his term.
But the uncertainty on display in gyrating financial markets this week has darkened expectations for Trump’s last two years. In the fourth quarter of 2018, forecasters already see growth slowing from the 4.2% recorded in the second quarter, and 3.5% in the third quarter.
For 2019 and beyond, they expect growth to slow progressively further as fiscal stimulus from lower taxes and higher spending winds down. Many predict the economy will lapse into recession in 2020.
In October, the National Association for Business Economics reported that two-thirds of forecasters it surveyed expect recession by the end of Trump’s re-election year.
That would represent a historically rare event – and an ominous one for the president’s chances of a second term.
Dwight Eisenhower, Richard Nixon, Ronald Reagan and George W. Bush all saw recessions begin in the first year of their tenures, but end by the close of their second year. Each won re-election.
For Bush and Eisenhower, recession returned in the last year of their second terms – when they were no longer eligible to run again. In both cases, their party’s nominees lost the White House.
