People generally are pretty darn cranky these days. It doesn’t matter if you look at surveys of consumers, investors, small business owners, or voters. Crankiness appears widespread.
And who can blame them? The economy struggles to emerge from one of the longest and deepest recessions since the Great Depression, and job creation is nonexistent.
Let’s start with consumer confidence. The Conference Board’s Consumer Confidence Index, after dropping precipitously in June, continued to fall in July.
Lynn Franco, the director of the Conference Board Consumer Research Center, offered nothing positive in her summation: “Consumer confidence faded further in July as consumers continue to grow increasingly more pessimistic about the short-term outlook. Concerns about business conditions and the labor market are casting a dark cloud over consumers that is not likely to lift until the job market improves. Given consumers’ heightened level of anxiety, along with their pessimistic income outlook and lackluster job growth, retailers are very likely to face a challenging back-to-school season.”
Remind me not to invite Franco to my next party — what a downer. But, hey, it’s really not her fault. The numbers are the numbers.
Rasmussen Reports found similar results in its Consumer Index, which also was down in June and July. In less-than-cheery fashion, Rasmussen reported that “overall levels of economic confidence are significantly lower today than they were in the aftermath of the 9-11 terrorist attacks.”
Interestingly, Rasmussen Reports also offers a measure of how confident investors are feeling. Again, crankiness rules. After the poor jobs report from the Bureau of Labor Statistics, the Rasmussen Investor Index fell to a new low for 2010 on August 9, registering about half the level of its all-time high that was hit in early 2004.
Consumers are pessimistic, and investors skeptical. But what about those eternal optimists, also know as small-business owners?
On Aug. 2, the latest tally of the Wells Fargo/Gallup Small Business Index was released. It hit its lowest level since the index’s inception in August 2003. To compare, the Small Business Index high of 114 was set in late 2006, while the latest measure came in at negative 28.
Taking into account business owners’ views of their financial situations, revenue, cash flow, capital spending, number of jobs, and ease of getting credit, the Small Business Index offers evaluations of the current situation and expectations for the coming 12 months. Owners’ glumness on the current state of affairs deepened, while future expectations moved into negative territory as well.
The Wells Fargo/Gallup report accurately pointed out: “Small-business owners are the embodiment of America’s entrepreneurial and optimistic spirit. As a result, their increasing concerns about their companies’ future operating environment do not bode well for the economy in the months ahead.” Indeed, when the eternal optimists, who also happen to be the nation’s economic engines, are down in the dumps, that’s very troublesome.
No matter which group one selects as being critical to the economy — entrepreneurs, investors or consumers — none are expressing confidence.
Obviously, such crankiness on economic matters translates into big trouble on the political front.
According to RealClearPolitics.com on Aug. 9, President Obama’s average disapproval rating among assorted polls came in at 50 percent, compared to an approval rating of 45 percent.
And how about Congress? A Rasmussen Reports Aug. 5-6 poll of likely voters found that 3 percent said Congress was doing an excellent job, 13 percent said good, and 27 percent fair. But 56 percent rated the job performance of Congress as poor. Other polls reveal similarly dismal opinions. A late July FOX/Opinion Dynamics poll of registered voters found 21 percent giving Congress thumbs up on job performance, and 71 percent thumbs down. And a late July-early-August The Economist/YouGov poll of adults put Congress’s approval rating at a lowly 12 percent, with disapproval at 63 percent.
Again, all of this ties together. First, Presidents George W. Bush (R) and Barack Obama (D), along with Congress, failed the economy by passing so-called stimulus measures — Bush in 2008 and Obama in 2009 — that at best did nothing to help the economy, but more likely did damage by expanding government spending. Second, Bush, Obama and Congress implemented unprecedented bailouts that undermined the market system, placed taxpayer dollars at risk, and fostered moral hazard. Third, the guiding force behind Obama’s tax and regulatory policies seems to be a dangerously mistaken notion that higher taxes and increased regulatory burdens are somehow good for entrepreneurship, investment and the economy.
Given this bewildering policy reality, why should we expect anything different in the aforementioned polling?
Naturally, there is a great deal of political talk about helping the economy. Economic shills for the Obama White House even assert that things would have been worse if not for the actions taken by the administration and Congress. But it must be getting harder by the day to make such absurd assertions with a straight face.
And people generally are seeing through the rhetoric. How could they not? After all, it is glaringly evident that policy decisions made by our federal elected officials have worked against the well being of consumers, investors and small business owners — and therefore against risk taking, economic growth, and job creation. No wonder everyone is cranky.
Keating is chief economist for the Small Business & Entrepreneurship Council. He can be reached at firstname.lastname@example.org.