April 28, 2010

Pessimistic Public Doubts Effectiveness of Stimulus, TARP

Section 2: The National Economy and Economic Policies

Though many experts say the nation’s troubled economy is showing signs of recovery, much of the public does not see it. Close to nine-in-ten rate economic conditions today as either poor (49%) or only fair (39%), numbers that have changed little since last June. A majority does not expect an imminent turnaround: more than a third (36%) say they think economic conditions will be about the same a year from now, while 19% say they expect conditions to worsen.

Public perceptions of two of the federal government’s most sweeping efforts to right the economy could be contributing to the pessimism. More than six-in-ten (62%) say the economic stimulus package enacted by Congress last year has not helped the job situation, while about half (49%) say the government’s loans to banks and other financial institutions did not help prevent a more severe economic crisis. Meanwhile, the public sees little government progress toward fixing the causes of the financial crisis. About four-in-ten (42%) say they see just a little progress; 25% say they see no progress at all.

Stimulus Not Seen as Helping

Substantial majorities of Republicans (79%) and independents (69%) say that last year’s economic stimulus has not helped the job situation. Even among Democrats, opinions about the effectiveness of the stimulus are not overwhelmingly positive: 51% say it has helped the job situation while 42% say it has not.

While a clear majority of liberal Democrats (61%) say the stimulus has helped, conservative and moderate Democrats are divided. About as many say the stimulus helped the job situation (46%) as say it has not (47%).

About six-in-ten African Americans (58%) say the nearly $800 billion stimulus package has helped, more than double the percentage of whites (28%). College graduates are more likely to say the stimulus has helped the job situation (39%) than those with some college education (29%) or those with a high school diploma or less education (31%). Still, even among college graduates close to six-in-ten (57%) say the legislation has not helped the job situation.

Mixed Views of TARP’s Effectiveness

Opinions are more mixed about the effectiveness of the federal government’s program to loan billions of dollars to troubled banks and financial institutions. About four-in-ten (42%) say the loans helped prevent a more severe economic crisis, while 49% say they did not.

Again, the partisan differences are stark. More than half of Democrats (54%) say the loans did help prevent a more severe crisis, while 37% say they did not. The balance of opinion among Republicans is nearly reversed: 35% say the loans did help prevent a more severe crisis, while 56% say they did not. Notably, opinions among independents about the loans’ effectiveness are nearly identical to those of Republicans (37% helped, 58% did not).

Better educated and more affluent people are more likely to say the loan program did help prevent a more severe economic crisis. For example, 56% of those with a college degree say the loans helped prevent a greater crisis, compared with 34% of those with a high school diploma or less education. Half (50%) of those with family incomes of $75,000 or more say the loans helped, compared with 40% among those with incomes of between $30,000 and $74,999 and 39% of those with incomes of less than $30,000.

Few See Progress in Fixing Causes of Crisis

With lawmakers on Capitol Hill negotiating specifics of a financial regulatory overhaul, most Americans say the government has made little progress in fixing the problems that caused the crisis in the financial markets in the fall of 2008. Four-in-ten (42%) say it has made just a little progress, while 25% say it has made no progress at all.

About three-in-ten say the government has made a great deal (3%) or some progress (28%) in fixing these problems. These numbers are little changed from October 2009.

As they did last fall, partisans have markedly different perspectives on this question. More than four-in-ten Democrats (45%) now say the government has made
at least some progress on this front, compared with 21% of Republicans and 25% of independents. About three-in-ten Republicans (32%) and independents (31%) say the government has made no progress at all, compared with 13% of Democrats.

Democrats More Upbeat About Economy’s Prospects

Most Americans see an economy that continues to struggle. About half (49%) rate economic conditions as poor, while 39% say they are only fair. Just 11% say conditions are excellent or good. In March, 53% rated economic conditions as poor, 39% said they were only fair, and 7% said they were excellent or good. These numbers have fluctuated only slightly for much of the past year.

As has been the case for several months, Democrats express less negative views of the national economy than do Republicans or independents. Majorities of Republicans (56%) and independents (55%) say the economy is poor, compared with 38% of Democrats.

About four-in-ten Americans (42%) say they think economic conditions will be better one year from now, while 36% say they expect conditions to be about the same and 19% expect conditions to be worse. Those numbers also have changed little in recent months. As with views of current economic conditions, opinions about the future economy are divided along partisan lines. Fully 61% of Democrats see the economy improving over the next year, compared with 36% of independents and just 27% of Republicans.

“Haves and “Have-Nots”

About four-in-ten Americans (42%) say they think of the nation as divided between “haves” and “have-nots.” That is up from 35% in April 2009, but comparable to the percentages measured in 2008 (43% in January and 44% in October).

Democrats (51%) are more likely than Republicans (32%) or independents (43%) to say they see a society divided between haves and have-nots. African Americans are much more likely than whites to see American society this way (66% vs. 37%).

Those with lower incomes and less education are also more likely to see a society divided in this way. Close to half (48%) of those with a high school diploma or less education say the nation is divided between haves and have-nots, more than those with some college education (40%) or college graduates (35%).

About half of those with family incomes of less than $30,000 (52%) say there is such a divide, compared with 40% of those with incomes of between $30,000 and $74,999 and 35% of those with incomes of $75,000 or more.

Just under half (45%) of the public says they see themselves as haves, while 36% see themselves as have-nots. That is little changed from surveys going back to March 2005. Not surprisingly, those with higher family incomes and the better educated are more likely to count themselves among the haves.

More than six-in-ten (63%) of those with household income of at least $75,000 say they see themselves as haves. By comparison, 31% of those with incomes of less than $30,000 and 45% of those with incomes between $30,000 and $74,999 say this. About six-in-ten college graduates (58%) say they see themselves as haves, compared with 45% of those with some college experience and 36% of those with a high school diploma or less education.