By Sean Trende - September 21, 2012

This is the last in a three-part series exploring the state of the presidential race. Part 1 explained why Barack Obama would win. Part 2 explained why Mitt Romney would win. This part explores the long-term implications for whoever wins this election.

In particular, I want to reflect on this column by Stu Rothenberg from 2008, which is one of the more prescient things I’ve ever read on politics. As Rothenberg put it, “In the worst-case scenario, a McCain victory in November could likely lead to a Republican bloodletting that would tear apart the GOP well before 2012, contribute to another good Democratic election in 2010 and hand Democrats such a strong advantage during redistricting that Republicans wouldn't be able to recover for years.”

Read the whole thing; it is 100 percent correct. If McCain had won, the Democratic policy agenda probably would have been more successful than it has been under Obama, since McCain favored a stimulus and health care reform, and would have pushed his party to enable passage of immigration reform and cap-and-trade legislation.

The economy would likely still be sluggish, the GOP would have been walloped in the midterm elections, and the debate right now would probably be about whether Democrats -- after controlling redistricting -- would approach veto-proof majorities in Congress, rather than their outside shot at winning the House.

It is always tempting for the winning party to spike the proverbial football after an election and declare that the American people have finally endorsed their agenda and rejected that of the opposing side. As I explain in “The Lost Majority,” however, those instincts are almost always wrong. If we’ve learned anything from the past two elections, it should be that the American people have very, very short memories, and that contingencies are always lurking around the corner waiting to catapult the losing side to victory.

In other words, there really are times when a party is better off losing. All in all, Democrats would have been much better off if Grover Cleveland hadn’t overseen the Panic of 1893. If Charles Evans Hughes is the one who has to deal with settling World War I and its aftereffects, James Cox probably wins in a landslide in 1920. If Gerald Ford wins in 1976, 1980 is likely an ugly year for Republicans, and Ronald Reagan is never president.

This year in particular strikes me as one where the winning side should be careful what it wishes for, especially if it takes full control of all three branches of government. There’s a very good chance that the next four years will be every bit as rocky as the last four, if not more so. Here are just four examples of massive problems looming. Having to deal with any one of them would be enough to sink a political party; having to deal with all four could be catastrophic.

I'll admit upfront that what follows is awfully negative. That is my overall sense of where things are headed in the short term. It's always dangerous to predict much beyond that; it is hard to say whether this is 1976, when disaster loomed for four years, or 1980, when bright days were just a few years away. Few predicted the Internet boom in the late 1990s, and for too many, America's worst days always seem just a few years away.

So this shouldn't be interpreted as giving investment advice of "guns, canned goods, and land in West Virginia." At the same time, however, I think it is important to acknowledge the enormity of the short-term challenges we face. The events of the past 15 years have thrown a lot of things out of whack, and I think we probably have a few more years until we return to that equilibrium.

The political ramifications of this are serious regardless of who wins. Because the short term is pretty grim, I think the 2014 midterms will be rough for whichever party holds the presidency. The 2016 elections are far enough away that predictions become more difficult. The fact that the Republican base has at best a love-hate relationship with Romney, and the fact that President Obama has no obvious heir apparent and the Democratic presidential bench is awfully thin makes the party coalitions unusually fragile going into that year to begin with.

1. The sluggish economy. Let’s just put it this way: The Federal Reserve Board didn’t just announce unlimited quantitative easing because things are looking rosy for the economy. And there is a real risk that this is simply as good as it gets for this recovery. The following chart shows year-over-year changes in GDP for the past 70 years, by quarter.

Here is year-over-year job growth during the past several decades.

In both instances, there’s usually a spike early in the recovery, and then the recovery settles in around the spike (or a bit lower). In other words, history suggests we shouldn’t expect to do that much better in the ensuing months of the recovery.

Note also that in both examples, the peak is below the peak from the 2000s, which is below the peak from the 1990s, which is below the peak from the 1980s. These aren’t salutary trends.

To further emphasize where we stand, here’s a chart of per capita GDP:

As you can see, once you account for population growth, we are still struggling to get back to where we were before the Great Recession began.