Good economic times are good for incumbents. After all, voters are more apt to look for change in tough times than they are in good ones.
Significant economic anxiety contributed to the "wave" elections of 2008 and 2010. In 2012, the economy improved just enough to help President Obama win re-election.
This year, Americans’ confidence in the economy is as strong as it's been in years. If that continues, it would probably mean a status quo cycle; which is the best that Democrats could hope for.
Democrats are the underdogs in 2014. They are defending seven Senate seats in deep red states, while Republicans have no vulnerable seats to protect. A combination of redistricting, the weeding out of vulnerable incumbents over the last three cycles, and a polarized electorate have helped to insulate the GOP majority in the House.
The best case scenario for Democrats is 2014 to limit their losses. An improving economic outlook could help them do that.
The economic environment is much improved from where it was right before Election Day 2010. And, it’s even a bit better than it was in the fall of 2012.
The Consumer Comfort Index measures “Americans' ratings of the national economy, the buying climate and their personal finances.” According to Bloomberg, the “comfort gauge has been hovering close to a five-year high of minus 28.9 reached at the end of April. It foreshadowed a similar gain in the Thomson Reuters/University of Michigan index of consumer sentiment, which reached an almost six-year high this month.”
"In terms of your own personal experience, do you feel the economy has or has not begun to recover."
Has Begun Has Not10/5/10 34% 63%
3/10/12 49% 49%
5/19/13 56% 43%
Unemployment Rate via Bureau of Labor Statistics
The unemployment rate has dropped from almost 10% in January of 2010 to 7.5% in April of 2013.
In other words, the headwinds that Democrats faced in 2010 have died down considerably. To be sure, it is still very early in the cycle and there’s no guarantee that voters are going to remain as optimistic next fall. More important, of course, is the impact that the Affordable Care Act (ACA) could have on voters’ perception of the economy. For most Americans, the cost of health care (and the spike in premiums that could come with implementation of ACA) is directly related to their perceptions of their own economic situation. Improvements in their 401(k) or a drop in gas prices may not be enough for many Americans to offset the financial disruption from big changes to their health care costs.