President Obama’s economic approval numbers have slipped this summer, even as he has crisscrossed the nation making the case that the nation’s financial picture has improved.
A new Gallup survey rates Mr. Obama’s handling of the economy at 35 percent, down seven points since June. His marks on taxes and the federal budget deficit have each dropped five points over the same period, to 36 percent and 26 percent respectively.
The president’s overall approval rating, meanwhile, has settled to 44 percent – from 47 percent two months ago.
Gallup, whose latest poll on Obama’s performance was conducted Aug. 7-11, notes that “these declines somewhat parallel the slide Gallup has seen in Americans’ economic confidence over the same period, although confidence picked up slightly this past week.”
So what gives? Is the White House right about the economy? Or are Americans feeling the pinch in a way the president hasn’t been taking into account?
If there’s a short answer to this question, it’s that the White House take on the economy is a tad rosy in some areas, while Americans are confronted daily with the excruciatingly slow pace of recovery.
Economic indicators, like so many numbers, are subject to interpretation. They are often crunched and spun these days just like campaign polling. So what is asserted as fact can sometimes depend on the sources cited and the reporting outlet.
Across the board, economists look at a range of data, from the stock market and unemployment numbers to manufacturing activity, housing sales, and the gross domestic product. And there are, of course, a slew of other variables.
With key budget battles ahead in Washington this fall over the debt ceiling and federal spending, Obama embarked on a campaign-style tour earlier this summer to showcase those economic areas he views as strong and sees, more broadly, as providing indications of a recovery. During his tour debut, he used the manufacturing sector, housing sales, and the stock market to make his case for improvement.
“Over the past four years, for the first time since the 1990s, the number of American manufacturing jobs has actually gone up instead of down,” Obama told a crowd gathered at Knox College in Galesburg, Ill.
“The good news is over the past four years, we’ve helped more responsible homeowners stay in their homes,” Obama also said in Galesburg. “And today, sales are up and prices are up, and fewer Americans see their homes underwater.”
And then this, from the president: “Now, today, a rising stock market has millions of retirement balances going up, and some of the losses that had taken place during the financial crisis have been recovered.”
One recent manufacturing industry report found the “pace of growth in the US manufacturing sector accelerated in July to the highest level in two years as new orders surged,” according to Reuters. Reuters said the report’s data supports “the view the economy will pick up in the second half of the year.”
Others see that manufacturing sector job growth has jumped around and ultimately leveled off since its February 2010 low point, reports the Washington Post. Obama has repeatedly championed the 500,000 manufacturing jobs added, but the paper’s Glenn Kessler reports that those gains were made a year ago and since then the trend is “downhill.”
“No one doubts that US-based manufacturing has experienced a very steep rebound from a deep recession,” said Alan Tonelson, a research fellow at the US Business and Industry Council in an interview with Kessler, but “it has slowed to a crawl over the last year or so.”
Meanwhile, on Obama’s second point, in 2012 home sales “rebounded to the strongest level in five years” – with CNN citing low mortgage rates, a drop in foreclosures, and rising home prices as drawing more consumers back to the market.
And while not everyone agrees that the stock market provides a clear window into a recovery, it’s surge in 2013 is viewed positively. The Dow Jones Industrial Average closed at an all-time high – 15,658.36 – earlier this month.
This type of growth, however, leads some to determine that the wealthy benefit disproportionately. “Economic recovery favors the more affluent who own stocks,” concluded the Pew Research Center.
Considering these and other markers, many prognostications suggest, much as the president does, that the nation is engaged in a slow recovery. Still, Bloomberg deemed the path “fitful” for the first half of 2013, following federal spending cuts and tax increases that delayed growth earlier in the year.
“We expect things to continue to pick up, although it’s probably not going to be an even trajectory,” Scott Brown, chief economist at Raymond James & Associates in St. Petersburg, Fla., said to Bloomberg last month. “We’re still definitely on the recovery path.”
So are there other signs that the economy is heading south? And do they help explain the public’s general unease?
“The biggest uncertainties remain the pace of business spending, the improvements in consumer spending power, and the impact of slower global growth on US exports,” said Ken Goldstein, an economist at the Conference Board in a statement to Bloomberg.
And it is job growth, in particular, that isn’t as speedy as some suggest it should be following a financial crisis of the magnitude the country experienced between 2007 and 2009.
The Wall Street Journal’s Marketwatch reports that the economy has added 121,000 jobs a month in the four years since the recession ended – but specifies that number is “barely enough to keep up with natural growth of the labor force.” And it notes that job creation is usually “much higher” after a “severe recession.” The US should be adding more than 200,000 jobs per month, according to the publication.
Overall, the economy lost 7.4 million jobs during the most recent recession and has recovered 5.8 million in the time since. Those looking for full-time work – 22 million people, according to the WSJ – are finding it tough.
So what we’re seeing there is good but not great. And from a political perspective for the president, perhaps folks are feeling that jobs crunch the most.
“You just have the reality of a very slow recovery with wages stagnant and lots of suffering even though things are turning around a bit,” says Tom Mann, a Brookings senior fellow and congressional expert. “It’s still the case that there’s a lot of concern out there.”
Michael Strain, a resident scholar and economist with the American Enterprise Institute, agrees that the jobs issue is a foremost variable for those weighing presidential performance.
While Obama is talking a lot about the economy, Mr. Strain says, he is investing much of his capital in long-view endeavors to improve it – health-care reform and green energy research and development, among other projects. The focus, he says, should be on the approximately four million people who have been unemployed for 27 weeks or more; these people are called the long-term unemployed. And they become less employable every day.
“The president is running around talking about how we can help address long-term slow burning problems facing the middle class, when instead he should be addressing immediate short-term problems facing the unemployed,” Strain says.
Brookings’ Mr. Mann cautions, though, that too much should not be read into the Gallup numbers. Where the economy is concerned, the bully pulpit of the White House can be overrated, he says.
Mann believes Obama’s sliding numbers reflect a general public concern, but not necessarily dissatisfaction with anything the president has or has not done. And he says Republican leaders in the House share as much blame for the state of the economy for refusing to work with the president around some of these key matters.
“If I were the president I wouldn’t take this too seriously, that the odds are these [numbers] will bounce around,” Mann says of the Gallup poll. “It will depend very much on two things. The real economy and whether things pick up or slow down, and what the jobs situation and housing situation looks like.”
“It will also depend on how these insane battles this fall will play out” between Congress and the White House, he adds.