Americans’ Confidence in the Economy Is Still Trapped in the Negatives

And it might shrink further as lawmakers scramble to avoid default.

Consumer confidence in the United States has recently dropped a few more points.
National Journal
Marina Koren
See more stories about...
Marina Koren
Aug. 27, 2013, 7:03 a.m.

At the be­gin­ning of the sum­mer, polls sug­ges­ted that Amer­ic­ans were al­most start­ing to feel bet­ter about the eco­nomy. But as back-to-school sea­son picks up, con­sumer con­fid­ence in the eco­nomy re­mains stuck in the neg­at­ives — and it’s head­ing fur­ther south.

Gal­lup’s Eco­nom­ic Con­fid­ence In­dex re­gistered minus 14 last week. In late May and early June, the in­dex re­gistered an all-time weekly high of minus 3, it but hasn’t gone above minus 10 since mid-Ju­ly.

Forty-two per­cent of Amer­ic­ans say the eco­nomy is im­prov­ing, while 54 per­cent say it’s get­ting worse. Twenty per­cent rated cur­rent eco­nom­ic con­di­tions “ex­cel­lent” or “good,” and 35 per­cent called them “poor.”

The Gal­lup Poll at­trib­utes the res­ults to dis­cour­aging em­ploy­ment news, rising mort­gage rates, and oth­er factors. While the un­em­ploy­ment rate fell to 7.4 per­cent in Ju­ly when the eco­nomy ad­ded 162,000 jobs, the num­bers were few­er than ex­pec­ted. At that rate of job growth, it would take about sev­en years to close the job gap cre­ated by the re­ces­sion, The New York Times re­por­ted. Also in Ju­ly, the rate at which new homes were sold fell 13.4 per­cent com­pared with June. Mort­gage rates, however, have been stead­ily rising since May.

As the U.S. ap­proaches the debt ceil­ing, mov­ing ever closer to­ward de­fault, more dips in con­fid­ence should be ex­pec­ted in the fall. Amer­ic­ans’ out­look on the eco­nomy has shown a tend­ency to co­in­cide with such polit­ic­al events. Con­fid­ence plummeted in the sum­mer of 2011 when Con­gress agreed to a deal at the last minute to raise the debt ceil­ing, which led to a down­grade of the coun­try’s cred­it rat­ing. Gal­lup also re­gistered de­creases at the end of last year dur­ing the fisc­al-cliff de­bate and in early March when se­quest­ra­tion went in­to ef­fect.

In a let­ter to House Speak­er John Boehner on Monday, Treas­ury Sec­ret­ary Jac­ob Lew pro­jec­ted that the de­part­ment’s “ex­traordin­ary meas­ures” cur­rently be­ing un­der­taken to avoid de­fault will be “ex­hausted in the middle of Oc­to­ber.” If his­tory has a way of re­peat­ing it­self, the pre­dic­tion does not bode well for Amer­ic­ans’ feel­ings about the re­cov­er­ing eco­nomy.

What We're Following See More »
TAKING A LONG VIEW TO SOUTHERN STATES
In Dropout Speech, Santorum Endorses Rubio
1 days ago
THE DETAILS

As expected after earlier reports on Wednesday, Rick Santorum ended his presidential bid. But less expected: he threw his support to Marco Rubio. After noting he spoke with Rubio the day before for an hour, he said, “Someone who has a real understanding of the threat of ISIS, real understanding of the threat of fundamentalist Islam, and has experience, one of the things I wanted was someone who has experience in this area, and that’s why we decided to support Marco Rubio.” It doesn’t figure to help Rubio much in New Hampshire, but the Santorum nod could pay dividends down the road in southern states.

Source:
‘PITTING PEOPLE AGAINST EACH OTHER’
Rubio, Trump Question Obama’s Mosque Visit
1 days ago
WHY WE CARE

President Obama’s decision to visit a mosque in Baltimore today was never going to be completely uncontroversial. And Donald Trump and Marco Rubio proved it. “Maybe he feels comfortable there,” Trump told interviewer Greta van Susteren on Fox News. “There are a lot of places he can go, and he chose a mosque.” And in New Hampshire, Rubio said of Obama, “Always pitting people against each other. Always. Look at today – he gave a speech at a mosque. Oh, you know, basically implying that America is discriminating against Muslims.”

Source:
THE TIME IS NOW, TED
Cruz Must Max Out on Evangelical Support through Early March
1 days ago
WHY WE CARE

For Ted Cruz, a strong showing in New Hampshire would be nice, but not necessary. That’s because evangelical voters only make up 21% of the Granite State’s population. “But from the February 20 South Carolina primary through March 15, there are nine states (South Carolina, Alabama, Arkansas, Georgia, Oklahoma, Tennessee, Kentucky, Mississippi, and North Carolina) with an estimated white-Evangelical percentage of the GOP electorate over 60 percent, and another four (Texas, Kansas, Louisiana, and Missouri) that come in over 50 percent.” But after that, he better be in the catbird’s seat, because only four smaller states remain with evangelical voter majorities.

Source:
CHRISTIE, BUSH TRYING TO TAKE HIM DOWN
Rubio Now Winning the ‘Endorsement Primary’
1 days ago
WHY WE CARE

Since his strong third-place finish in Iowa, Marco Rubio has won endorsement by two sitting senators and two congressmen, putting him in the lead for the first time of FiveThirtyEight‘s Endorsement Tracker. “Some politicians had put early support behind Jeb Bush — he had led [their] list since August — but since January the only new endorsement he has received was from former presidential candidate Sen. Lindsey Graham.” Meanwhile, the New York Times reports that fueled by resentment, “members of the Bush and Christie campaigns have communicated about their mutual desire to halt … Rubio’s rise in the polls.”

Source:
ARE YOU THE GATEKEEPER?
Sanders: Obama Is a Progressive
1 days ago
THE LATEST

“Do I think President Obama is a progressive? Yeah, I do,” said Bernie Sanders, in response to a direct question in tonight’s debate. “I think they’ve done a great job.” But Hillary Clinton wasn’t content to sit out the latest chapter in the great debate over the definition of progressivism. “In your definition, with you being the gatekeeper of progressivism, I don’t think anyone else fits that definition,” she told Sanders.

×