Americans’ support for President Donald Trump’s management of the economy has slipped, a new Reuters/Ipsos poll shows, challenging a bedrock re-election argument laid out at the Republican National Convention this week. About 58 per cent of respondents said the US economy is on the wrong track in a survey taken August on 19 through 25th. And for the first time this year, Trump’s net approval on economic issues dipped into negative territory, with 47 per cent saying they approved of his stewardship of the American economy and 48 per cent saying they disapproved. That is down from an approval margin of 14 percentage points in late March.
While the poll shows Trump still has an edge with voters over Democratic opponent Joe Biden on the economy, the results highlight the risks the Republican Party is taking by leaning on memories of last year’s strong economy and arguing that Trump will easily be able to restore it.
“Our economic choice is very clear. Do you want economic health, prosperity, opportunity and optimism, or do you want to turn back to the dark days of stagnation, recession and pessimism?” White House economic adviser Larry Kudlow said at the convention last Tuesday night.
“Who do you trust to rebuild this economy?,” Vice-President Mike Pence asked on Wednesday night. “A career politician who presided over the slowest economic recovery since the Great Depression? Or a proven leader who created the greatest economy in the world?”
Looking to the fall, just as the US witnessed a historic drop in gross domestic product from April through June, Trump will be able to trumpet a record increase — equivalent to perhaps 25 per cent on an annualised basis — when statistics are released in October covering the July to September period.
Neither data point, products of a deliberate shutdown of the economy in March and the automatic impact of reopening from that sudden stop, say much about the economic fortunes of families and businesses during the first months of the pandemic, or in the weeks to come.
The coronavirus health crisis, with nearly 6 million infected and over 175,000 Americans dead, is still raging. The onset of the conventional flu season is on the horizon, and an experiment under way in reopening schools and colleges is already leading to new spikes in infections.
Consumer confidence, which can influence future economic activity, remains weak. The national unemployment rate at 10.2 per cent in July is the highest in 39 years, and improvement seems to be slowing. Nearly 15 million Americans are receiving unemployment benefits, the highest on record and double the number hit during the 2007 to 2009 Great Recession.
The blow has been received hardest among groups including blacks, Hispanics and women who benefited most from last year’s record low unemployment rate. Continued support among white women in particular will be critical to Trump’s electoral chances.
The Reuters/Ipsos poll found most voters would not currently back Biden on the economy.
Trump’s team has been hammering Biden’s discussion of tax policies to pay for rising government debt due to the Trump administration’s earlier tax cuts. Among registered voters, Trump still has a five-point edge over Biden in who would be better to manage the economy.
But the poll also found 30 per cent of Republicans felt the economy was on the wrong track, the highest since February 2018 when Reuters/Ipsos started tracking the question. The poll gathered responses from 4,428 American adults, including 1,929 Democrats, 1,750 Republicans and 430 independents. It has a credibility interval, a measure of precision, of between 2-5 percentage points.
If the economic impact of the pandemic has been in some ways less severe than feared, with household spending returning to pre-pandemic levels and Americans boosting their savings, it is only because of massive government spending and a larger federal footprint in the economy.
Both Republican and Democratic leaning economists feel much more federal help and a larger federal footprint will be needed to avoid a deeper slide this fall — steps that Trump would have to embrace even as he tries to brand Biden a “socialist.” — Reuters
Howard Schneider and Chris Kahn
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