Thursday, August 02, 2007

Americans: Soaring Confidence & Gloom Over Impending Doom

How can America's Consumer Confidence "soar" while America's "Economic Mood" be "gloomy"? I don't get it. First the confidence:

Confidence among Americans, whose spending accounts for more than two-thirds of the economy, is being shored up by a jobless rate that's near the lowest in six years and income gains that have outpaced inflation.

"The consumer economy, once again, remains on a firmer footing than it has generally been given credit for," said Richard DeKaser, chief economist at National City Corp. in Cleveland. "Even in spite of the pause in spending, we will see them come back."
Now the gloom:
More than two-thirds of Americans believe the U.S. economy is either in recession now or will be in the next year, a new Wall Street Journal/NBC News poll shows. That assessment comes despite the fact the economy has experienced sustained growth with low inflation and unemployment and generally rising stock values ever since the recession that ended early in President Bush's tenure.


"The macroeconomy is reasonably healthy," said Mr. Corzine, former chief executive of Goldman Sachs Group Inc. "But the reality for the majority of America is they're lucky if they hold on....The numbers are different from what the feel is on Wall Street."
Americans, it seems, have turned into suspicious malcontents:

When those who expressed pessimism were asked to identify a reason, the Iraq war was cited by the highest proportion, 56%. For the first time since the Sept. 11, 2001, terrorist attacks, a plurality of Americans say the U.S. is less safe than before the attacks.

Failures in the health-care system are next on the list at 31%, as Americans continue to struggle with rising costs and coverage gaps. Democratic Gov. Jon Corzine of New Jersey, in Washington yesterday to lobby for higher federal health-care spending, argues that the two concerns feed on each other since Americans "think the war is pre-empting our ability to deal with health care and other issues."

That 56% number seems awfully close to the 50% Democrat voters and the 6% undecided who decide to flow with whichever way the winning wind blows.

As for feeling less safe, this could either be interpreted as just common sense--a reality has crept in--we have a myriad vulnerabilities. Before 9/11 we gave security no thought. After 9/11 there was still some denial. But the terrorist bombings in Britain, the captures here in the U.S. remind citizens that the world has changed. Perhaps this is simply a rational reaction.

Corzine's blathering about health care is his Democrat projection. The notion that the war is distracting from other issues is a Democratic position. It is the press' position. It is the activist position. I don't buy that it is the average American's position.

As for the economic double-mindedness, I think a lot of people are living way beyond their means. Their world feels fragile to them. If one spouse loses his or her job, the whole family is topsy-turvy.

Finally, I think many people are enraged at the Republicans and they still don't get it. This is the party of fiscal responsibility and ethics, right? They have shown no spine facing the Democrats. And, they were the problem when they were in power. Congress is corrupt and doing everything they can to continue the corruption. Glenn Reynolds says this about the pseudo-earmark reform:
Can't we vote for "none of the above"? Plus, will Republican's appetite for pork keep the Democrats in the majority? "House Minority Leader John Boehner of Ohio talks a good case for more openness and transparency in government, but what’s he been doing to corral more support for Flake, Campbell and Hensarling among the GOP ranks he is supposedly leading?"
Yes, the Republicans will keep Democrats in charge with their two-faced actions. As to why the Republicans join the Democrats: expedience. They must believe that the only thing between them and their power is earmarks for their constituents. They don't get the overall view, though.

As much as Congressional Republicans might be tempted to blame "Bush's War" for their precarious re-election bids, they should refrain from doing so. The gluttony of the Republicans has done more to disgust party loyalists than the Iraq war. That and illegal immigration amnesty, but that legislation didn't pass--lucky for Republicans.

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