March 16, 2009

Obama’s Approval Rating Slips Amid Division Over Economic Proposals

Section 2: The Policy Agenda

A month after President Obama signed the economic stimulus bill, most Americans (56%) express a positive view of the nearly $800 billion package. Slightly more than a third (35%) says the legislation is a bad idea.

In early February, the Pew Research Center asked a similar question only of those who said they had heard “a lot” or “a little” about Obama’s proposal (91% of the public); among those who had heard at least a little about the stimulus, 51% said it was a good idea, while 34% viewed it negatively.

Republicans continue to oppose the stimulus by a wide margin (67% vs. 27%). Meanwhile, Democratic support for the legislation has risen since early February (81% vs. 70%). Slightly more than half of independents (53%) say the stimulus is a good idea, while 37% say it is a bad idea.

Nearly two-thirds (63%) of those younger than 30 say the legislation is a good idea, compared with 47% of those 65 and older. People with lower family incomes also are more likely than those with higher incomes to say they think the stimulus is a good idea. Nearly two-thirds (64%) of those earning less than $30,000 say the legislation is a good idea, while only about half (51%) of those earning $75,000 or more say the same.

Most people (56%) who say they have given a lot of thought to Obama’s economic plans and policies say the stimulus is a good idea. An identical proportion of those who have given less thought to Obama’s policies also express a positive opinion of the stimulus.

Where Government Should Help

While Americans broadly back the notion that the government should spend billions of dollars on roads and other public works programs to help stimulate the economy, they are less supportive of other costly steps to help end the deep recession. In addition, the gap is growing between Republicans and Democrats over programs to help keep financial insitutitions secure and to help homeowners facing foreclosure.

About three-quarters of the public (77%) say increased spending on infrastructure projects is the right thing for the government to do, compared with 19% who say it is the wrong thing to do. Large majorities across the partisan spectrum support this approach: 72% of Republicans, 81% of Democrats and 77% of independents.

But there are deep divides over the idea of the government spending billions of dollars to help homeowners facing foreclosure on mortgages they cannot afford and to help secure financial institutions and markets. There also is little support for the government spending billions on loans to automakers to help them stay in business.

Fewer than half (46%) say it is the right thing for the government to spend billions of dollars to help homeowners facing foreclosure; an identical percentage says it is the wrong thing to do. Almost two-thirds of Democrats (64%) say that is the right thing to do, compared with 23% of Republicans and 46% of independents. The gap between Democrats and Republicans has widened – from 29 to 41 points – since the same question was asked in December.

Notably, those with family incomes of $30,000 or less are the only income group where a majority (55%) sees the homeowner foreclosure assistance as a good idea. At the other end of the income spectrum (family incomes of $100,000 or more), 36% view homeowner foreclosure aid positively – the lowest of any income group.

Just under half (48%) say spending billions of dollars to help keep financial institutions secure is the right thing to do, compared with 40% who say it is the wrong thing to do. Again, the partisan divide is widening. About two-thirds of Democrats (66%) say this is the right thing to do, while only 27% of Republicans say the same. Almost half (46%) of independents say it is the right thing to do.

The public expresses considerable skeptism about extending loans to General Motors and Chrysler to help the automakers stay in business. Three-in-ten say this is the right thing for the government to do, down from 39% in December. More than six-in-ten (63%) say this is the wrong thing for the government to do. Democrats are slightly more supportive than Republicans and independents, but still only 37% of Democrats says this is the right thing for the government to do. Nearly three-in-ten independents (28%) agree, as do 21% of Republicans.

Obama’s Budget Proposals

There is widespread support for some of Barack Obama’s key budget proposals – particularly those dealing with changes in the tax structure. But opinion on other key proposals is more evenly divided.

More than eight-in-ten (82%) of the public say it is the right thing for the government to reduce taxes for middle and lower income households compared with only 14% who say it is the wrong thing. A smaller majority (61%) supports raising taxes on people with incomes of $200,000 or more. Somewhat fewer (55%) has a positive opinion of limiting tax deductions upper income people can take for charitable contributions.

In contrast, 41% say it is the right thing for the government to change the Medicare prescription drug plan so that upper- income retirees will pay more for prescription drug coverage; a majority (52%) takes a negative view of this proposal. And about the same percentage (40%) says it is right for the government to reduce agricultural subsidies to most farms.

Majorities of Republicans express negative opinions about Obama’s budget proposals, with one notable exception: 75% of Republicans say it’s the right thing to reduce taxes for middle and lower-income households. Nonetheless, more Democrats (88%) support tax cuts for middle and lower-income households.

The largest partisan differences are over Obama’s proposals to raise taxes on people with household incomes of $200,000 or more: More than twice as many Democrats as Republicans say this is the right thing for the government to do (80% vs. 37%). Conservative Republicans are the least likely to favor this proposal; only 32% say it is the right thing. A majority of independents (59%) view tax increases for the affluent positive
ly while 37% say it is the wrong thing.

There is also a large party gap over the issue of limiting charitable tax deductions for upper income people; 67% of Democrats and 58% of independents say it is the right thing compared with only 35% of Republicans.

Obama’s proposal to modify the Medicare prescription drug plan so that upper-income retirees pay more draws considerable opposition from Republicans and independents and modest support among Democrats. Majorities of Republicans (60%) and independents (56%) say this is the wrong thing for the government to do. Most Democrats (53%) support making upper-income retirees pay more for drug coverage, but 41% oppose it.

On the issue of reducing agricultural subsidies, more Republicans say it is the wrong thing than the right thing (57% vs. 34%), while Democrats and independents are more evenly divided.

Affluent Oppose Tax Hike

As might be expected, there is considerable opposition to Obama’s proposal to raise taxes on people in upper-income categories among the affluent themselves. Nearly two-thirds (65%) of those with family incomes of $150,000 or more say it is wrong to raise taxes on high-income households (at least $200,000). Majorities in other income groups say raising taxes on higher income people is the right thing to do. Among those earning less than $30,000, 71% say it is the right thing compared with 23% who say it is the wrong thing.

In contrast, there is very little difference by income on reducing taxes for middle and lower income households. More than eight-in-ten across all income groups support this proposal.

Bank Bailout Draws Public Ire

On balance, there is more public anger about bailing out banks that made poor decisions than there is about bailing out homeowners who took out mortgages they cannot afford.

Overwhelming majorities are at least bothered by both policies (87% banks, 83% mortgages), but a 48% plurality says bailing out banks and financial institutions that made poor financial decisions makes them angry. Fewer (39%) say they are angry about bailing out homeowners who took out mortgages they could not afford.

Not surprisingly, anger is most widespread among people who believe that these policies are the wrong thing for the government to be doing. But negative reactions are not limited to the opposition. More than a third (36%) of Americans who say investing billions into stabilizing the markets is the right thing to do say they are angry that banks and financial institutions that made poor decisions are being bailed out. Another 45% say this policy, which they support, bothers them.

Similarly, 72% of those who support the government helping homeowners facing foreclosures on mortgages they cannot afford say they are, at least, bothered by bailing out people who got in over their heads; 21% of supporters go so far as to say this policy makes them angry.

More high-income Americans than those with low incomes say they are angry about both the bank and homeowner bailouts, but the income gap is larger when it comes to the issue of bailing out people who cannot afford their mortgages. Half of people with family incomes of $75,000 or more say they are angry about the mortgage bailouts, compared with just 27% of people earning less than $30,000 annually.

Anger over Earmarks and Deficit

The growing budget deficit makes 37% of Americans angry, while another 46% say they are bothered by this but not angry. Just 14% say they are not bothered by the growth in the federal budget deficit. Government money being spent on special interest projects elicits a similar response: 34% say this makes them angry and another 39% are bothered but not angry about this; 20% say such budget earmarks do not bother them.

Nearly half (48%) of Republicans say the growing deficit makes them angry, compared with 28% of Democrats. Similarly, 46% of Republicans say they are angry about government money being spent on special interest projects; just 22% of Democrats are angry. More Democrats are angry about the government bailing out banks (39%) than homeowners (28%); more than half of Republicans are mad about both policies (55% and 54%, respectively).

Is Obama Spending Too Much?

The public is divided over whether Obama has proposed spending too much money or about the right amount to address the economic situation; 39% say he has proposed spending too much, 34% say about the right amount, while 13% say he has not proposed enough spending.

Seven-in-ten Republicans say he has proposed spending too much while only 19% say he has proposed spending the right amount; 79% of conservative Republicans say he is spending too much compared with 51% of moderate and liberal Republicans.

By contrast, only 17% of Democrats say Obama’s economic proposals entail excessive spending. About half of Democrats (52%) say he has proposed the right amount of spending while 16% say he has proposed too little. Four-in-ten independents say Obama is proposing too much spending, 32% say it is about right and 17% say it is not enough.
People with high family incomes are more likely than less affluent people to say that Obama has proposed spending too much. And nearly half (47%) of those who say they have given a great deal of thought to Obama’s economic plans say his proposals are too costly; that compares with 35% of those who have thought less about Obama’s policies and plans.

People who think the economic stimulus recently passed by Congress is a bad idea overwhelmingly say that Obama has proposed spending too much (84%). Similarly, those who say it is the wrong thing for the government to invest billions to keep financial institutions and markets secure also say he has proposed spending too much (66%).

Government Role: More Economic Control, but Not Bigger Government

By a 54% to 37% margin, more Americans say it is a good idea right now for the government to exert more control over the economy. But this does not mean that Americans favor a growth in government more generally. Just 40% say they prefer a bigger government providing more services, while 48% prefer a smaller government providing fewer services.

Views differ along partisan and ideological lines. But within each partisan and ideological group, the distinction between bigger government and more government control of the economy remains stark. For example, independents favor the government exerting more control over the economy right now by a 54% to 38% margin; they also prefer a smaller government providing fewer services by a 52% to 39% margin.

Republicans generally favor a smaller government and oppose the government exerting greater control over the economy right now. However, while Republicans support smaller government by greater than three-to-one (72% to 22%), opposition to increased government control over the economy is less overwhelming (58% say it is a bad idea, 32% a good idea.)

Similarly, while 73% of Democrats favor the government exerting more controlover theeconomy right now, a smaller majority (56%) says they want a bigger government providing more services in general.

Preferences over a bigger government providing more services or a smaller government providing fewer services differ notably across income and age lines. Majorities of young and low-income Americans favor bigger gov
ernment, while majorities of older and high-income Americans favor smaller government. But the differences are not as great when it comes to the question of the government exerting more control over the economy right now. Half or more of all those with incomes less than $100,000, and of those younger than 65, believe it is now a good idea for the government to do more in this area.