Americans this Fourth of July are short-term pessimistic but long-term optimistic. I’d say that unless things change for the better, they need to reconsider the long term.
[IMGCAP(1)]Last week’s NBC-Wall Street Journal poll shows that 62 percent of U.S. adults think that the country is “on the wrong track,” the highest level during Barack Obama’s presidency.
The Reuters/University of Michigan Consumer Sentiment Index rose in May to its highest level since January 2008, but the Conference Board’s confidence index dropped and so did Gallup’s June economic confidence index. In the Gallup survey, pluralities of respondents rated the economy as “poor,” and around 60 percent said it was getting “worse.”
That sentiment is validated by the best summary I’ve seen of the current recovery — a New America Foundation report describing a “relatively weak GDP rebound” and “a jobless recovery,” facing the phasing out of fiscal and monetary stimulus, Europe’s financial crisis, U.S. debt overhang and an uncertain tax and regulatory environment.
Moreover, economists Sherle Schwenninger and Samuel Sherraden wrote, “State and local governments face fiscal shortfalls that are beginning to act as a drag on GDP growth and job creation,” housing prices are not recovering and wages are stagnant.
That’s the short-term bad news — just part of it. Along with oil spills and deepening doubts about the Afghan war, President Barack Obama’s support is dipping, though there’s no great confidence in Republicans, either.
As to the long term, however, a new Pew Research Center poll for Smithsonian magazine shows that 64 percent of Americans are optimistic about life for themselves and their families over the next 40 years, and 56 percent say the economy will be stronger than it is today.
People expect cancer to be cured and most energy to be derived from sources other than coal and oil, but 53 percent are afraid the U.S. will be hit with a nuclear terrorist attack.
Despite overall economic optimism, only 34 percent say that the standard of living for average families will get better, while 36 percent say it will get worse and 27 percent say it will stay flat.
And 58 percent believe that the gap between rich and poor will continue to grow.
That, I’m afraid, is in the cards. It’s partly owing to the failure of American schools to educate minorities, who will soon be a majority of the U.S. population.
Only half of all minority children graduate from high school on time and, of those who go to college, fewer than half graduate. The U.S. ranks 10th among all countries in overall college completion.
Moreover, as the Washington Post reported, China and the European Union are catching up with the United States in the number of people engaged in scientific and engineering research and development, and the U.S. trails Japan and South Korea in the percentage of gross domestic product spent on research investment.
On top of all that, the nation is in deep, deep debt. The official gross public debt — accumulated deficits plus borrowing from federal trust funds — is nearly $1.5 trillion, 95 percent of GDP.
But the Peter G. Peterson Foundation calculates the true level of federal obligations at more than $62 trillion, counting promises made to Social Security and Medicare recipients.
And those figures do not count personal, corporate, and state and local pension fund debt — on all of which interest needs to be paid, crowding out capital that could boost investment and wages.
Adm. Mike Mullen, chairman of the Joint Chiefs of Staff, said last week that next year’s federal interest payments will be $571 billion, as large as the defense budget, and that the debt constitutes a major threat to national security.
A Gallup poll showed that the public agrees, ranking the debt as tied with terrorism as the top danger to the country.
The NBC/Wall Street Journal poll said that by a whopping 63 percent to 34 percent, the public wants Obama and Congress to worry more about keeping deficits down than boosting the economy — even if it means that the economy will take longer to recover.
As it is, only 33 percent of voters expect the economy to get better in the next year, while 23 percent expect it to get worse and 43 percent to remain flat.
Fearing a “double dip” or Japan-style stagnation, Obama and Democratic leaders want to pass stimulus legislation to help the states but can’t get it passed.
The gloom has Obama’s job approval rating down to 45 percent, the lowest of his presidency.
By 47 percent to 40 percent, the public still has a favorable view of Obama as a person — down from 68 percent just after he was inaugurated — and by 49 percent to 32 percent, voters think he has strong leadership qualities, also down from 68 percent.
Congress’ approval rating is 22 percent, almost as low as the 20 percent that preceded the Democrats’ takeover in 2006 and the 33 percent that presaged the GOP takeover of 1994.
Indeed, voters now marginally prefer that Republicans run the next Congress, by 45 percent to 43 percent.
But asked about the parties, voters give a 9-point net negative rating to the Democrats, 35 percent to 44 percent, and a 12-point net negative to the GOP, 30 percent to 42 percent.
The bottom line seems to be that an unhappy public is hoping that divided government will put the country back on the right track.
But given the inability of Republicans and Democrats to agree on almost anything, there’s more reason to be pessimistic about the long term as well as the short.