May 1, 2008

Obama’s Image Slips, His Lead Over Clinton Disappears

Section 4: Trade and the Economy

Americans express increasingly negative opinions toward the World Trade Organization (WTO) and free trade agreements such as NAFTA. In the current survey, a 48% plurality says that free trade agreements are a bad thing for the country, compared with 35% of the public who call them a good thing. Last November, opinion about free trade’s impact on the country was evenly split; for the previous decade, modest pluralities said that free trade agreements were a good thing for the country.

A larger proportion of Americans also says that free trade agreements are having a negative impact on their own personal financial situation. Nearly half (48%) says that free trade agreements have hurt their personal financial situation, up from 36% in December 2006.

There is now broad agreement that free trade negatively affects wages, jobs and economic growth in America. By greater than six-to-one (61% to 9%), the public says free trade agreements result in job losses rather than in new jobs. A solid majority (56%) says that free trade makes wages lower in the United States, and half (50%) say it slows the economy.

Americans are more divided when it comes to free trade’s impact on the price of products. A 39% plurality say free trade leads to higher prices for Americans, but 29% say that prices are lower because of free trade. In December of 2006, a slim plurality said free trade agreements lead to lower prices for American consumers.

The public does see one beneficiary from free trade agreements: people in developing countries. By a 58% to 12% margin, Americans say free trade is good for the people of developing countries. Opinion on this question has changed little since December 2006.

Views on Trade, Economy Linked

Public views on free trade have long been linked to overall economic assessments, and as ratings of the economy have soured, evaluations of the impact of free trade agreements have turned more negative. In December 2006, 38% of Americans said the economy was in excellent or good shape, and the balance of opinion toward free trade agreements among these people was more positive (51% good for the country) than negative (33% bad).

Today, the balance of opinion toward free trade remains just as favorable among Americans who think the economy is doing well, but just 11% of Americans are of this opinion.

At the other end of the spectrum, people who think the economy is in poor shape have consistently rated free trade agreements more negatively, and their views have become more critical since December 2006. More important, the share of Americans who believe the economy is in poor shape has increased from 19% to 56% since December 2006.

Dems, Reps See Trade Costing Jobs

In general, Republicans express more positive views than do Democrats about the impact of free trade agreements on the United States. Still, as many Republicans see free trade agreements as a bad thing as a good thing (43% vs. 42%). Democrats, by 50% to 34%, say free trade agreements are bad for the United States. A narrow majority of independents (52%) views free trade agreements as bad for the country.

Solid majorities of Democrats (64%), independents (64%) and Republicans (55%) say that free trade agreements lead to job losses – rather than create jobs – in the United States. There also is fairly broad agreement that free trade agreements lower, rather than raise the wages of American workers.

Democrats, by nearly four-to-one (57% to 15%) say that free trade agreements slow the economy down rather than make it grow; this also is the prevailing view among independents (50% vs. 18%). Republicans are more evenly divided about the economic impact of free trade, with 40% saying it slows the economy and 29% saying it spurs economic growth.

Trade’s Personal Impact

Opinions about the personal impact of free trade continue to vary along socioeconomic lines. In general, people with higher incomes, the young, and the better educated are less likely to feel that they have suffered financially because of free trade, while older Americans and those with lower levels of income and education report being hurt by free trade agreements in greater numbers.

For example, among those in households earning $75,000 a year or more, only 33% say free trade agreements have hurt their financial situation. By contrast, majorities of those earning less than $75,000 a year say they have been hurt by free trade agreements. In addition, 39% of college graduates say free trade has hurt their financial situation compared with 54% of those with no more than a high school education.

Middle-aged and older Americans also are more likely to report being negatively affected by free trade than are younger people. About one-in-three 18-29 year olds (34%) say they have been hurt financially by free trade, compared with about half or more of those in older age groups.

Economic Problems Blamed on Iraq and Energy Prices

Views of the nation’s economy remain about as negative as they were in March. A majority of Americans (56%) continues to describe the country’s economic conditions as poor, while 33% say conditions are only fair. Just 11% say the economy is in excellent or good shape (10% good and 1% excellent).

Asked to choose among five alternatives, people who rate the economy as only fair or poor most often cite the war in Iraq and rising energy prices as the biggest reason for the nation’s economic problems. Roughly three-in-ten cite the war, while 26% blame rising energy prices; other factors, such as foreign competition (12%), too little regulation of financial institutions (11%), and the normal ups and downs of the economy (9%) are mentioned less often.

Nearly half of Democrats (45%) say the war in Iraq is the biggest reason for the nation’s economic problems, compared with just 13% of Republicans. By contrast, a plurality of Republicans (37%) blames rising energy prices for the economic downturn. Republicans also are far more likely than Democrats to view normal economic ups and downs as the biggest reason for the economic problems (15% vs. 5%).

Americans are less negative about their own personal finances than they are about the nation’s economy. More than four-in-ten (43%) say they are in excellent or good shape financially, compared with 55% who rate their finances as only fair or poor. People’s views of their personal finances have declined slightly since March when 47% rated their finances as excellent or good.