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Economic Anxiety and the Middle Class


Last week, the USA Today "Gallup Guru" blog of Gallup editor in chief Frank Newport took up the issue of economic anxiety among the middle class. Newport argues that the "rising middle class economic angst" claimed by various Democratic leaders has little support in recent survey data. While Newport is certainly right that traditional measures of economic confidence have been on the rise, he may miss the role that the Iraq war and energy prices have had in creating anxiety about our economic future.

Newport's central argument is that on most questions about the economy, Americans are now more positive than they have been in six or more years:

Perhaps most telling is a long-term question that asks Americans if their personal financial situation is better or worse than it was a year ago. Fifty percent say that they are better off, 30% worse off and the rest say they are the same. These may not seem like stunningly positive statistics, but this marks the most positive read on this measure since 2000, at the tail end of the dot.com boom. In February of 2006, for example, only 37% said they were better off. In April of 2003, the better off number was 32%.

The regular Consumer Confidence measures reported by ABC News and the Washington Post shows much the same thing.

ConsumerConfidenceABCPost.png

Newport also points out that Iraq, not the economy is the central concern of most Americans:

Only 17% of Americans in fact mention any type of economic problem in response to the question: What is the most important problem facing the country today? Although that's partly the result of the overwhelming dominance of Iraq in people's minds, it simply doesn't suggest any great economic anxiety at the moment.

Except that in an indirect way, Iraq does translate into economic insecurity. At the post election conference sponsored by the Cook Political Report that I attended back in December, James Carville asked pollsters present what role the economy played in the 2006 election. All four agreed that the economy was a factor, and that the traditional economic measures were missing the particular flavor of discontent that worked to the Democrats advantage.

Republican Neil Newhouse argued that the discontent was not about jobs or the stock market, but rather about the costs of health care, energy, housing (including mortgages) and unease over layoffs. More important, perhaps, Newhouse argued that voters "linked Iraq" to their sense of economic unease. They may tell pollsters that they are doing well now, but also worry that the resources and attention directed at Iraq might lead to economic difficulties down the road.

Democrats Stan Greenberg and Harrison Hickman both pointed out that the economic pressures Newhouse discussed (gas prices and worries about health care costs) were most dominant in rural areas and with non-college educated voters. Greenberg discussed and tested some of these themes in this post election survey and report. While I have not seen one survey question that confirms the linkage from Iraq to the economy, economic concerns anxiety was mentioned often as a reason to vote Democratic. Greenberg found that 45% of Democratic voters (or those who considered voting Democratic) agreed that "changing our economic policies so that middle class families can prosper again" was "one of the top few reasons" for their vote. Three out of four (75%) named that statement as at least "near the top" of their concerns.

Update (2/9): Frank Newport responds here, more thoughts from me here.

 

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