Views On Economy Worsen

Americans are getting more pessimistic about the economy – 60 percent say it's bad, the highest number recorded in a CBS News poll in ten years – and a majority disapproves of the way President Bush is handling it.

With public confidence in the economy falling and the job market stagnant, the president called his economic team down to Texas on Wednesday to show the world he's on the case.

But few Americans see signs of a recovery, and most think the Bush administration's tax cuts – the centerpiece of his economic and jobs program -- will not do much to improve either the stock market or the job market.

THE ECONOMY

The economy remains in first place as the most important problem facing this country, as it has for the past few months. Nearly four in ten volunteer it.

The public is pessimistic about the economy, and has become more so recently. 60% think the economy is in bad shape – the most negative assessment seen in this poll in ten years. Just a few months ago, opinion was more evenly divided. And this represents a marked deterioration since January 2001, when Bush first took office; then, 84% thought the economy was in good shape.

RATING THE ECONOMY

Now

Good
38%
Bad
60%

7/2003

Good
45%
Bad
52%

5/2003

Good
48
Bad
51%

1/2001

Good
84%
Bad
15%

The last time ratings of the economy were more negative than they are now was in September 1993; then, 67% thought the economy was bad, and just 32% thought it was good.

In June 1991, at roughly the same point in the presidency of the current president's father, negative evaluations of the economy were similar. Then, 42% thought the economy was good, and 57% thought it was bad. But views continued to decline over the next few months; by October, 65% thought the economy was in bad condition.

55% of Americans think the economy has deteriorated in just the past two years, and there is particular alarm over the job market. Two thirds think the job market has gotten worse since then.

In addition, 44% are concerned that they or someone in their household will lose their job in the next year.

At the same time, most Americans seem personally to be treading water financially; 65% say their finances are about the same or better than they were two years ago. But a third are worse off now.

Few see much prospect for improvement. Just under one in four Americans think an economic recovery is currently underway, but slightly more – 27% -- think the economy is getting worse. 49% think it is staying the same.

THE ECONOMY IS…

Getting Better
23%
Staying the same
49%
Gettting worse
27%

Republicans are more optimistic than Democrats about the economy, but only 37% of them think it is getting better. Those with higher incomes and men are more likely to think it is getting better as well.

Many think declines in the economy and the job market have occurred under the Bush Administration's watch, and the President receives poor ratings in this area. In this poll, 36% approve and 52% disapprove of his handling of the economy -- his most negative evaluations in this area since he took office.

BUSH'S HANDLING OF THE ECONOMY

Now

Approve
36%
Disapprove
52%

7/2003

Approve
41%
Disapprove
46%

5/2003

Approve
44%
Disapprove
49%

Due in part to the positive assessments of his handling of Iraq, Bush's overall job approval rating is more positive; 55% approve and 35% disapprove.

Overall, Bush receives only a modicum of blame for current economic conditions. Most think Bush's policies have had an impact on the economy, but believe that impact has been small. 48% believe the Administration's policies have had a little impact, and 37% think those policies have had a lot of impact. But perhaps as a result of the tax cuts that have been implemented, the Bush Administration's policies are seen as having a greater effect on the economy now than the public thought in January 2002.

However, that obscures an important finding from this poll; Bush receives more blame than credit for the current economy when the questions are asked separately to people who hold different views about the direction of the economy. Among those who think the economy is on the upswing, 37% give him lot of credit for its recovery. But among those who think the economy is getting worse, 56% place a lot of blame on Bush and his policies.

Part of the problem may be that most of the public thinks Bush's attention is not focused enough on the problem. 25% think the president is paying enough attention to the economy, while nearly three times as many -- 70% -- think he is not.

That complaint – that the president is not paying enough attention to the economy -- has become more widespread over the past few months. In May, 61% felt Bush was not paying enough attention to the economy.

About half of Republicans think the President needs to spend more time on the economy; 48% think he is paying enough attention to the economy, but 47% think he should be paying more attention. Among Democrats, 88% think he is not paying enough attention to the economy.

And most Americans think the president has made little progress creating new jobs. 55% think he has made not much or no progress in this area, and 39% think he has made at least some.

HAS BUSH MADE PROGRESS CREATING JOBS?

A lot/some
39%
Not much/none
55%

There is some skepticism about the president's plan for economic recovery as well. The centerpiece of Bush's economic and jobs program is tax cuts, but Americans think it is unlikely that the Bush tax cuts will lead to more jobs. Only 38% think it likely the new tax cuts will create more jobs, while most -- 55% -- think that is not likely to happen. Views on this have become more negative since last May.

The public expects tax cuts to do even less for the stock market –- only 22% expect the tax cuts will improve the stock market. 9% expect they will be detrimental to the markets, while 49% think they will have no effect.

Investors are slightly more optimistic about the impact of Bush's tax cut program on the stock market; 26% think the tax reductions will be good for the market, but 54% think they will have no effect.

THE STOCK MARKET

The stock market is considered an important factor in the nation's economic health; 62% think it has a major impact, and another 27% think it has a minor effect.

While few (6%) would say the stock market is very good right now, 43% think it is in fairly good shape. Americans are hesitantly optimistic about its short-term outlook; 32% think the market will not change in the next three months, and 41% think it will rise moderately. Only 1% expects big gains.

Investors' views are somewhat more bullish; 51% expect a moderate rise in the market.