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
Add to Briefcase
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 »
CITES CONFLICT OF INTEREST
Lieberman Withdraws from Consideration for FBI Job
3 days ago
THE LATEST
MINIMUM 2 PERCENT GDP
Trump Tells NATO Countries To Pay Up
4 days ago
BREAKING
MANAFORT AND FLYNN
Russians Discussed Influencing Trump Through Aides
4 days ago
THE DETAILS

"American spies collected information last summer revealing that senior Russian intelligence and political officials were discussing how to exert influence over Donald J. Trump through his advisers." The conversations centered around Paul Manafort, who was campaign chairman at the time, and Michael Flynn, former national security adviser and then a close campaign surrogate. Both men have been tied heavily with Russia and Flynn is currently at the center of the FBI investigation into possible collusion between the Trump campaign and Russia.

Source:
BUT WHITE HOUSE MAY USE AGAINST HIM ANYWAY
Ethics Cops Clear Mueller to Work on Trump Case
5 days ago
THE LATEST

"Former FBI Director Robert Mueller has been cleared by U.S. Department of Justice ethics experts to oversee an investigation into possible collusion between then-candidate Donald Trump's 2016 election campaign and Russia." Some had speculated that the White House would use "an ethics rule limiting government attorneys from investigating people their former law firm represented" to trip up Mueller's appointment. Jared Kushner is a client of Mueller's firm, WilmerHale. "Although Mueller has now been cleared by the Justice Department, the White House may still use his former law firm's connection to Manafort and Kushner to undermine the findings of his investigation, according to two sources close to the White House."

Source:
BUSINESSES CAN’T PLEAD FIFTH
Senate Intel to Subpoena Two of Flynn’s Businesses
5 days ago
THE LATEST

Senate Intelligence Committee chairman Richard Burr (R-NC) and ranking member Mark Warner (D-VA) will subpoena two businesses owned by former National Security Advisor Michael Flynn. Burr said, "We would like to hear from General Flynn. We'd like to see his documents. We'd like him to tell his story because he publicly said he had a story to tell."

×
×

Welcome to National Journal!

You are currently accessing National Journal from IP access. Please login to access this feature. If you have any questions, please contact your Dedicated Advisor.

Login