IF the United States' economy appears so bright, why do President Clinton's approval ratings look so dim?
Since he has been in office, the jobless rate has dropped, consumers have gained confidence, and the economy has grown at a healthy clip. Yet poll after poll shows Mr. Clinton slipping from favor.
White House advisers who have worked to make the core campaign promise of economic revival a success story for this administration say they are confounded by the paradox.
Clinton's deputy economic adviser Gene Sperling asserts that his boss remains focused on the economy, even as he negotiates political obstacles to push through a crime bill, health-care reform, and other major programs.
National Economic Council chairman Robert Rubin, who insists that the country's economic fundamentals are sound, counsels that the public will eventually reward the president for his strong stewardship of deficit reduction.
Republicans are quick to remind the Democrats that the United States was rebounding from recession well before Clinton's tenure. And while the president's deficit-reduction package passed congressional muster last year, his fiscal stimulus plan did not. But the economy grew, indicating that government intervention was unnecessary.
At a Monitor breakfast last week, White House budget director Alice Rivlin commented on the president's waning support. ``I find this as hard to understand as anybody else. When you think back to what was happening in the economy two years ago or less, the projections then were very gloomy.''
``We were facing rising [federal budget] deficits,'' Ms. Rivlin recalls, ``a very sluggish economy, very little job growth, [and] a very high unemployment rate. Now that has turned around. The deficit's coming down very substantially and faster than we thought it would.... Unemployment is back down, we created a lot of jobs. It's hard to see why this hasn't gotten more favorable attention.''
Here are some possible reasons:
* Interest rates: Although the Clinton administration has relied on low interest rates as the main lever for the economic growth that it is anxious to sustain through the 1996 presidential election campaign, an inflation-wary Federal Reserve has raised rates several times in recent months. Critics blast the Fed for threatening to derail economic recovery, but the central bank says a growth spurred by low interest rates is no longer needed.
* The dollar: Despite popular expectations that Washington can and should defend the value of the US dollar, the greenback's pummeling in international currency markets has demonstrated just how powerless the president is in shoring up its value.
* Skittish financial markets: Wall Street analysts, who reacted positively to Clinton's deficit-reduction plan, have reacted negatively in response to a weakening of the dollar, US-Japan trade friction, and perceived flip-flopping in Clinton's foreign policy.
* Shrinking export markets: The US trade deficit is headed toward its second highest level in history, a strong reflection of the economic slowdown in European and Japanese markets. The administration has failed to champion one of its highest-profile issues: prying open the Japanese market. Washington's ties with Tokyo are marked by recurrent breakdowns in bilateral trade talks.
* Jobs: Workers and the unemployed have seen little progress toward creation of the ``high-wage, high-skilled'' jobs Clinton promised. Much of the job creation has been part-time. Labor Secretary Robert Reich cautions that while Clinton policies have created more than 3 million jobs and unemployment is down, ``we can't face the voters'' without addressing job insecurity, fear of unemployment, and earnings that fail to keep up with inflation.
``I think the only economic explanation [for Clinton's sinking ratings] is perhaps that people are aware that more needs to be done,'' Rivlin says. ``There is still a deficit there, [and] the economy needs greater investment in order to be on a growth track.''
Some private economists forecast an expanding economy through 1996, and assert that Fed policies intent on slowing growth have done much to ensure it.
``There are some tell-tale signs that higher interest rates are reducing economic growth from the unsustainable pace of last year,'' says Sung Won Sohn, chief economist of Norwest Corporation, a financial firm in Minneapolis. He projects that the Fed won't send rates significantly higher this year.
But current growth is not strong enough ``to overcome a hesitancy on the part of most of our firms to add new full-time employees,'' says Barry Rogstad, president of the American Business Conference, a coalition of mid-sized firms. ``Even in an otherwise healthy economic environment, vigorous job creation remains an elusive goal.''