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What the Bailout Polls Really Tell Us


Three polls, all at the same time, give three wildly contradictory pictures of the American public. The Los Angeles Times/Bloomberg poll says the public opposes taxpayer bailout of Wall Street by 55 percent to 31 percent, a result cited on CNN by David Gergen the night the poll was published. He used the poll to illustrate his point that "the American people" were angry with the thought of using government funds to help Wall Street firms. That theme seemed to dominate several of the networks' coverage of the issue, though it was contradicted by a Pew Research poll, published the same day as the Times/Bloomberg poll. Pew found that "Most Approve of Wall Street Bailout" (by a margin of 57 percent to 30 percent). Either a 24-point margin against the bailout, or a 27-point margin in favor. Could there be any greater demonstration of how confusing the media polls are to anyone who genuinely cares about what the public thinks? But then there is the Washington Post/ABC poll published the very same day as the other two, showing a very different public, one that finds "Tepid Public Approval for Fed Action," by a statistically insignificant difference of 44 percent to 42 percent.

ABC's Gary Langer acknowledges these discrepant results, writing that "Some analysts might say the results are contradictory; I'd suggest instead that we learn more, not less, by comparing and contrasting them." The "instead" clause seems like a non sequitur to me - it is obviously true that the results are contradictory and, yes, we can also learn "more, not less" by examining their contradictions. Perhaps especially enlightening, besides the fact that each polling organization phrased the questions differently (giving different information to the respondents), is Langer's point that only 27 percent of respondents had "strongly" held views - 9 percent in favor, 18 percent opposed. It hardly portrays the public as fighting mad against the government's plan to address the economic crisis, when almost three-quarters of the public seems more tentative than decisive.

Two days later, a CBS/New York Times poll found what might best be described as "tepid opposition" to the federal government's bailout plan - 42 percent who approve to 46 percent who disapprove. But after asking respondents about that plan (without specifying the details), the poll then gave respondents limited information about the plan Congress is working on, principally that the government would "provide" $700 billion of government funds to financial service companies in danger of going bankrupt. The question then asked if respondents thought it was a good idea or a bad idea, or "don't you know enough to say?" With that formulation, the poll found 38 percent opposed, 16 percent in favor, and 46 percent without an opinion.

An examination of all the poll results suggests a public that is mostly taking a wait-and-see attitude toward whatever plan the president and Congress might finally adopt, a conclusion that was hardly the dominant theme of any network, nor of any news media organization conducting its own polls. That the public might be ambivalent is not surprising, given how confusing the actual events have proven to be. As Langer notes, the vast majority of people don't feel strongly one way or the other. Moreover, as the CBS/NYT poll shows, close to half of the public expresses no opinion, when explicitly given that option. I suspect the percentage would have been even higher, if the poll hadn't given respondents information about the plan and then asked their immediate reaction to it. (It is also likely the direction of the results would have been different, if the information provided to the respondents had been more objective - perhaps including mentions of oversight, control of CEO salaries, public equity in the companies, and/or the "investment" character of the funds, rather than the implication that the money would be handed out to the companies with no strings attached).

It's true as Langer notes, that we pollsters can learn a great deal by examining the results of contradictory poll results. But that doesn't address the larger problem of how the general public and political leaders view them. We may think conflicting poll results are enlightening, but I suspect to many others, they merely demonstrate how untrustworthy polls are in the first place.

 

Comments
ReprobateMind:

Let's not forget, it is the Democrats that are pushing to saddle Main Street with bailing out Wall Street. Republicans are trying to prevent saddling Main Street with Wall Street’s bail out bill.

And let us also be realistic. If we buy those underwater assets for $700 billion premium, it is also more likely they will depreciate rather than appreciate. So all this hype of possibly making the tax payers a profit is foolish non-sense designed to entice the public support.

The Main Street tax payer is going to loss twice. Even if Main Street goes ahead and foots the bill for Wall Street bail out, it is not going to fix the Main Street problems.

It is lose lose for Main Street.

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s.b.:

Makes you think twice about any Presidential polls from MSM outlets doesn't it?

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Eddie:

@ReprobateMind:
Forgive me if I'm wrong, but didn't the REPUBLICAN Treasury Secretary and the REPUBLICAN President insist that we have to do this bail out? How do you end up blaming the Dems for this one?? There are plenty of REPUBLICAN Senators who were in discussions all this week to try to work out a deal with Senate Dems and they had it done until McCain came up there and got the conservative republicans in the house to revolt. Event the administration is saying there's no chance the new proposal has a chance, because it won't work. And, it contains MORE of the deregulation that got us into this mess in the first place!!

And I've heard several economists who are very critical of this deal saying that it's actually about $100b of bad debt (underwater loans) and the rest is good debt, but it's clogging up the system. There's little chance we'll recover much, if any, of the $100b. But there is a very good chance we'll recover the remaining amount and may in fact come out ahead.

Look, I am NOT HAPPY at all about this crap. But don't go blaming the Democrats, when the Republicans have been in power in Congress for 12 of the last 14 years, and the in control of the White House for the last 8! Illogical.

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JFactor:

It's always really, really difficult to measure "public opinion". The whole concept of public opinion is more or less a constructed myth but there's no need to go into that philosophical pondering now. It's silly to drive a whole day's media narrative based on one poll that is simply not going to tell you anything significant about "the general consensus".
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http://www.internationalpoliticstoday.com

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ncc81701:

IMO all the polls about the approval of the bailout plan this week can be thrown into the garbage. The biggest problem is that there is no consensus on what the plan is exactly. The outline of the plan is changing from day to day, sometimes hour to hour this week. Key amendment to the bill, such as executive compensation could sway someone's opinion from disapproval to approval. I think due to the rapid changes to the bailout plan I think it is difficult if not impossible to find a random sample that has been expose to the plan uniformly, thus the raw data on this matter itself is jibberish.

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ReprobateMind:

@Eddie:

I specifically cite the Democrats because they are the ones try bowing to the Administration and Treasury Secretary and trying to ram this bill through. The have never met a tax they didn’t love. I am glad that the Republicans are seeing the light and pushing back, and if it took McCain going to Washington to give them some steel in the spin I applaud him for that.

Yet the Democrats rage on the Republicans for representing their constituencies desires, and continue trying to ram the bill through anyway. I would rather have no Wall Street bailout than to make Main Street pay for it.

And do not be so naive as to think that the tax payers are going to end up making any money on this. This is an investment in a depreciating security, that is why the current holders want to force them on Main Street tax payers.

Deregulation did not get Wall Street into this mess. Fraud on Wall Street, and stupidity on Main Street did. Yes that is right I said stupidity on Main Street. Those people who are either naïve or too greedy that they try to live beyond their means.

So how do we prevent fraud you may ask. By actually enforcing the laws and regulations the already exist. Starting by, as McCain has already stated, replacing the head of the SEC with someone who will carry out their duty to the public. This is something I have personally complained about in investment forums many time for years. And McCain is right.

As for the past chance to proactively correct and prevent this mess, Republicans try and could not get support form Democrats, including Obama. Still, should they have done more? Yes, absolute both sides of the aisle should have done more. They both bare a lot of blame for letting it get to this point.

But right now, my concern is about saddling Main Street with this. Let Wall Street heal itself. We on Main Street will make due with the ramifications. We on Main Street are unfortunately all so very adept at making due with the ramifications of Wall Street thieves.

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Potomac Bob:

What tax is is that is involved in borrowing $700 billion? If you mean to imply that we will someday have to pay it back, then that same logic should apply to everybody. That makes Bush is the biggest tax-raiser in history - since we've borrowed more under his presidency than any other. All those things we all thought were tax cuts under Bush were really tax increases, because we borrowed the money for them. Or is there some other logic there that I'm missing?

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gjdodger:

ReprobateMind:

I see no reason to believe the assets will continue to depreciate in value. What's happened is the assets--homes--were bought in a rapidly ascending spiral of prices; when the crunch hit and people were unable to make their house payments, the glut of repossessed homes coming back onto the market further depressed the values of all homes and left still more people with undercollateralized notes. That's a supply/demand inversion.

I saw this same thing happen with the farm equity crisis of the 80's. Land prices had spiraled higher in the 70's, and when a plunge in farm profitability left farmers unable to make their note payments, there was a glut of land on the market; prices fell nearly 60% from the peak. However, two pieces of legislation--the 1985 Farm Bill and the 1986 Ag Credit Act--stabilized farm returns, propped up ailing lenders and took the pressure off mortgages; land prices found a bottom and started their inevitable ascent. And never stopped; they've gone up every year since then. As with farmland, a home has intrinsic value; the only problem is keeping the supply from getting ahead of the demand curve.

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NorseSoccer:

@Reprobate

Way(!) more houses and home mortgages in this country than farms. So the magnitude of this financial issue is of a vastly greater scale.

There are still a lot of mortgages that could fail, there are still a lot of people who are going to lose their jobs..lose their mortgage..., we are at the beginning of this crisis.

The House Pepulicans idea to have to government "insure" these bad mortgages is merely a semantic difference from the Bush/Paulson plan.

If you insure something (the toxic debt) which you know has already partially failed and which you know will continue to get worse .... you are going to end up paying out more in benefits than you are getting from the banks in premiums. The problem is that you can't charge the banks enough to pay for all the losses...If the banks had the money to pay for the losses on the mortgage side, then we wouldn't have this problem.

So the whole idea of "insuring" these banks is ludicrous and shows a total lack of understanding of the problem ... and is just political posturing. It SOUNDS like the government is bailing them out, but in the end the taxpayers are going to have the unfreeze the credit market with an infusion of capital or ... well, jobs lost, greater depression...etc

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keytype123:

There is a possibility of a 269 tie based on the electoral-vote map (if Virginia goes red).What would it take for one of Maine's EV's to go to McCain i.e how close in the popular vote would he need to be in Maine or does he have to win a district and if so is this a possibilty-a rural district for example?

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JWilly48519:

It may be a good thing that these economic-mechanics questions are too complex for universal polling. That leaves room for intelligent leadership to move us into an era of:

1. Effective market regulation, focusing particularly on trustable books and requiring fundamental asset valuation that remains valid even in a demand downturn.

2. Mandated personal/family asset exposure for every top-tier executive in major industries, including finance.

3. Executive compensation above a minimal base salary that's delayed, and proportional to long-term profits.

4. Policy-encouraged *long-term-stable* real estate values and stock prices, with stock returns via dividends instead of price growth.

5. *Significant* tax discouragement for holding stocks for less than a year.

6. Required guarantees of mortgage performance by sellers of those mortgages, backed by exposure of assets of the seller's executives and owners.

I reckon that though many individuals would not express a poll opinion on such proposals, those who would do so would support them as being a sensible course.

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Nick Panagakis:


There really was quite a range in the poll descriptions of the plan. The fact that the plan is still a work in process may lead to different results a week from now.

Descriptions ranged from this…
LA Times/Bloomberg, Sep 19-24. “"Do you think the government should use taxpayers' dollars to rescue ailing private financial firms whose collapse could have adverse effects on the economy and market, or is it not the government's responsibility to BAIL OUT private companies with taxpayers' dollars?”55% said “not government’s responsibility”. (Yes. That Bloomberg.)

…to this more up-to-date description.
USA Today/Gallup, Sep 24. “"As you may know, the Bush administration has proposed a plan that would allow the Treasury Department to BUY AND RE-SELL up to $700 billion of distressed assets from financial companies.”11% voted for “not take ant action on the matter”

As Moore pointed, CBS found (42%) who didn’t “know enough to really say”. Stay tuned.

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