Between Aug. 26-28 and Sept. 5-7, the Gallup economic confidence index rose by 17 points -- from -33 to -16 -- a remarkable jump in just over a week.Look at the chart, and in particular, look at the .pdf of the complete trend (upper right hand corner). The most pronounced spike occurs at the beginning and throughout the Democratic National Convention.
OK, it is admittedly just a data point, and it could be an outlier, as Gallup notes. But it would appear from this data that Americans' confidence in the economy correlated to the Democratic run-up to nominating Barack Obama for President. Correlation is not causation, and we had a big run-up in the Dow this week substantially due to news out of Europe.
But even the Wall Street Journal has noted the Economy, in fits and starts, is slowly, painfully, inch by inch, beginning to turn around.
Please don't get me wrong. Unemployment is still horrendous from any objective standpoint, and the personal toll of prolonged unemployment is not something I am disregarding or minimizing. But the indicators that drive the Electoral politics in this country do appear to be slowly moving in the President's direction.
This is from the Wall Street Journal article linked above (subscription only)from approximately four weeks ago:
Americans are gaining confidence in the nation's economy, a new report Friday said, but remain wary that threats could wipe out recent modest progress after three years of fitful recovery.The Dow Jones Industrial average, which drives the retirement savings accounts (401K's) of a large part of working America, is at a multi-year high.
A stream of encouraging economic data in recent weeks—following a slow start to the second half of the year—has eased recession fears while underscoring the recovery's slow and uneven pace.
The University of Michigan consumer sentiment index increased to 73.6 in its preliminary August reading from 72.3 in July and its highest reading since May. Job growth picked up in July and layoffs have eased after a spring spike. Exports—big ..
"The path of least resistance is higher, not lower," said Mark Lehmann, president at JMP Securities. "Despite all the bad news and all the fear and all the problems and blowups, the market is making new highs. That's telling you that people are underexposed to equities, that you do have underparticipation, but there is a recovery going on."As bad as things are for the unemployed and underemployed--and they are bad--there are signals that this economy, at least for much of the electorate, is in a noticeable recovery they can see in their personal lives.
And this is thanks to absolutely no effort whatsoever on the part of a Republican Congress. The Republican House, led by an economically illiterate bloc known as the Tea Party, has done absolutely nothing to stimulate economic growth. Quite the contrary, they've impeded it consistently, most memorably by holding the country hostage to the brink of default on its debts, an action which many holders of 401K retirement plans will not soon forget.
Whatever its cause, a spike in economic confidence is the GOP's and Mitt Romney's worst nightmare. As Gallup itself (under)states:
But if it's accurate, changing views on the economy could have a major impact on the election.You can donate to President Obama's re-election campaign here.