It's Not the Economy, Stupid

Oct. 26, 2006 — -- Democratic party strategist James Carville gets credit for the phrase that may well outlive him: "It's the economy, stupid." Actually, what he said, or wrote during Bill Clinton's 1992 campaign, was "The economy, stupid."

Carville hoped to keep campaign workers focused on a huge issue, the faltering economy under President George H.W. Bush.

Now, 14 years later, the former president's son presides over a fairly healthy economy. But, to steal from the late Rodney Dangerfield, he "don't get no respect."

The most recent ABC News/Washington Post poll finds that 55 percent of Americans believe the economy is in good shape. And registered voters rank the economy as the second most important issue in the campaign.

So, if Americans, including registered voters, feel the economy is important and healthy, why are Republicans doing so badly in the polls, and why do 60 percent disapprove of Bush's job performance?

Our survey found the president gets little credit for good economic news: By a 54-37 margin, Americans trust Democrats to do a better job handling the economy.

Political experts and pollsters offer three reasons for the country's reluctance to reward Bush and his party for economic gains.

First and foremost, Iraq. Disenchantment with the war has colored the way voters feel about Bush on other issues. Thomas Mann of the nonpartisan Brookings Institution says feelings about Iraq "are now so relentlessly negative and increasingly passionately, intensely so that they tend to overwhelm other news that might be positive."

Second, a bad economy can hurt the party in power (just ask the president's father), but a good economy does not necessarily translate into gratitude at the polls. In 2000, Vice President Al Gore had a strong economy going for him, but it did not propel him into the Oval Office.

And finally, not everyone agrees that the economy is so swell at the moment. A closer look at the ABC News poll finds that voters give very mixed grades when they are asked about their own family's financial situation.

While 24 percent say they are getting ahead financially, a virtually equal number, 23 percent, say they are falling behind. And most, 52 percent, say they have just enough money to maintain their standard of living but not enough to improve it.

Americans are still uneasy about the economy even though the stock market has hit record highs, gasoline prices are falling, and many analysts believe interest rates will also go down soon.

Often there is a lag between the reality of the economy and the public's perception of it. In the 1992 election, as voters went to the polls in November, the economy was actually improving. But voters did not realize that. So they punished the man in the White House and elected Bill Clinton.

By the time of the 1994 congressional elections, the economy had improved but not enough to help the Democrats. They lost control of the House for the first time in 40 years.

Voters were angry over such issues as gun control and Hillary and Bill Clinton's botched attempt at health care reform. That anger outweighed any confidence they had that the economy was on the upswing under Clinton. By the time the country realized the economy really was prospering, the Republicans were in firm control on Capitol Hill.

Now many voters seem angry and disenchanted again over a litany of things they blame the president or his party for, such as the Hurricane Katrina debacle, corruption and scandal in Congress, the abortive effort to partly privatize Social Security and, of course, Iraq.

For much of this fall's congressional campaign, President Bush has tried to change the subject with repeated appeals for voters to realize they are living in good economic times. At a party fundraiser on Tuesday, the president said, "Real wages have grown 2.2 percent over the last 12 months. ... This economy is the envy of the world."

But in Thomas Mann's words, "Negative news has a way of driving out positive news."

Apparently, the president realizes that. So at a news conference on Wednesday, he took on the Iraq issue directly with a lengthy opening statement, expressing optimism while acknowledging that "the road to victory will not be easy."

As for the election, the president was upbeat about that, too, warning the Democrats against overconfidence. Returning briefly to his theme of economic gains, Bush said the Democrats have been wrong before in predicting that tax cuts would damage the economy.

"If their electoral predictions are good as their economic predictions, November 7 is going to be a good day for the Republicans," he said.