I agree wholeheartedly about the influence of the media. Many people seem to swayed by what is in the headlines and what the news anchors are "spinning," rather than the facts. Just watch one of the late night shows! The number one issue is the economy. Ronald Reagan famously said, "A recession is when your neighbor loses his job. A depression is when you lose yours." Although we are not in a depression, millions of people are unemployed or under-employed, millions are on food-stamps, and finally, millions of homeowners are being foreclosed on. The price of gas and food continues to rise. When these issues hit their "pocket-books," then people start paying attention to who is in charge and wonder, am I going to better off with 4 more years of the same administration?
It seems obvious that when the economy is in a downturn, economic issues will without question be a the forefront of the election. It would seem like common sense that the economic problems during an incumbents term would make him less likely to get elected. However there are so many other factors to consider in an election. But sticking with economics I think that this situation may play out either way because there is great division amongst the populace and the politicians of our nation about what is happening with the economy, why it is happening, and how to fix it. The growing influence (and bias) of the media has most of us confused as to what is really happening with our economy and how to really fix it. If we don't know what is really going on, how can we decide who is best to turn it around? It is too hard to find unbiased reports, so the average voter is going to be more swayed by media coverage than real economic informaiton.
As Bill Clinton said "It's the economy, stupid". I think the current economic climate will be the number one issue in the upcoming Presidential Election. The polls right now are close enough that a significant economic uptick could propel the President to victory, but negative economic news could potentially make him a one term president.
GDP per se doesn't get used, but trends in GDP definitely do. Presidential candidates will certainly refer to things like "economic growth" and recessions, which are related to GDP. Many scholars have tried to draw connections between GDP growth and presidential elections. Their studies have tended to show that there is a correlation between GDP growth and the incumbent party's chances of reelection, even if the candidates themselves do not go around talking about GDP.
It is difficult to say how the current economic figures portend for the upcoming election. No president since FDR has ever been elected to a second term with unemployment figures higher than 7.2%. The current figures are around 9%. GDP has not, to my knowledge, ever been one of the statistics trotted out by politicians at election time, though that doesn't make it any less important as an economic indicator. I would actually think that a good economic indicator for solely political forecasting purposes would be consumer confidence, since that does reflect the current economic mood. Generally, though, I would be surprised if unemployment rates, even if they fall somewhat, weren't an issue in the campaign, though many social and cultural issues appear to be increasing in volume now as well. Here is an article from Gallup. It actually claims that GDP is, perhaps, important: