The DNC is out with a new memo (PDF), short and worth reading, making the case that this November will not be as bad as 1994 was for Democrats or 2006 was for Republicans. It is an attempt to dispel the idea Democrats will lose control of the House.

The memo makes some compelling points, like the fact that President Obama’s job- approval rating right now is not nearly as bad as George W. Bush’s was during the 2006 election. For me, the most convincing piece of data is that Americans still trust Democrats more than Republicans on the most important issue, the economy.

In fact, on what may be the most important issue of this election – the economy – Democrats lead Republicans in voter trust, and do so by a similar margin to Democrats in 2006 and a larger margin than Republicans in 1994.

According to a Washington Post/ABC poll, registered voters trust Democrats over Republicans 42% to 34% to do a better job handling the economy, an 8 point margin [ABC/WP Poll, 7/13/10].

In October 2006, when the Washington Post/ABC poll asked the same question, registered voters picked Democrats over Republicans by 50%-41% [ABC/WP Poll, 7/13/10], a nine point margin. And when they asked the same question in 1994, registered voters picked Republicans over Democrats 43%-38% [ABC/WP Poll, 7/13/10], a five point margin. So, in the two most recent elections where control of Congress flipped from one party to the other, the party out of power held the advantage on the economy, while the party in power holds that advantage today.

The fact that the DNC needs to convince people that this election will be not as bad or worse than the two most game-changing midterm elections in the last several decades is not a good sign. Losing only half as many seats as Democrats lost in 1994 would still be a significant net loss of 27 seats. Doing better than the historic worst case is setting the bar very low.

The other thing to keep in mind is that we are a little more than three months away from the election. Even if things are not as bad as they could be for Democrats right now, there is still time for things to get worse. The economy is sluggish, and if unemployment goes higher in the coming months, it could undermine Americans’ trust in the Democratic Party on the issue of the economy. A drop in employment is a real possibility, since Democrats have foolishly all but abandoned trying to pass legislation to improve the jobs situation in the short term. If that happens, things could become even uglier for the incumbent party.