When will Dems 'own' the Economy

September 15, 2009

• by: David Cantor

With the nation’s unemployment rate remaining stubbornly high, voters are likely to ask two fundamental questions about the economy when they cast ballots in less than 14 months: How did we get into this economic mess, and who is to blame?

Voters see plenty of blame to go around. The Bush administration, corporate America, lax regulation, subprime mortgages and overspending all garner their share of public censure. A March Washington Post/ABC News poll showed that more than 70 percent of Americans felt a good amount of the blame should be placed on banks and other financial institutions, large corporations and consumers.

But eight months into the Obama administration and after billions of stimulus dollars spent under the leadership of a Democratic White House and Congress, a new question is emerging: Who does the American public think now “owns” the economy? That is, who bears responsibility for current and future economic conditions?

Republicans, tongue not so firmly in cheek, might argue that the Obama administration now literally owns the economy. But for the public, polling suggests that the answer is more complicated.

Start with the obvious: President Barack Obama was given a great deal of leeway upon taking office. People weren’t expecting a miracle. The public assumption was that things had become so bad after eight years of the Bush administration it would take quite a while to get the ship of state righted.

Even as Obama’s numbers have fallen in other areas, August polling shows that far from blaming Obama for economic conditions, Americans continue to trust him to fix the economy. A Marist poll shows 74 percent of Americans think Obama inherited the current economic conditions; a Harris poll finds that Americans place more blame for current economic conditions on congressional Republicans (85 percent) and former President George W. Bush (83 percent) than on Obama (33 percent). And when it comes to doing what’s right for the economy, Americans are more likely to trust Obama (61 percent) than Republicans in Congress (33 percent).

Polls in the months after the Inauguration showed the public expected recovery to take years, not months. And a July CBS News/New York Times poll shows the majority of Americans think the current recession will last at least two more years. But how much time does Obama have before the economic conditions become his own? And if we have a recovery of jobs, will he get credit or blame?

Ownership of the economy will become an increasingly important factor as the 2010 elections approach. Republicans are quick to tell us that Obama will own the economy come next November. And for the most part, history suggests they are correct.

While we lack extensive polling data for past administrations, House midterm elections – involving voting across the country and coming two years into a new administration – are good proxies.

Recent presidents who have inherited a bad economy have seen their party lose significant numbers of House seats in the next midterm election. Bill Clinton lost 52 House seats in 1994, Ronald Reagan lost 26 House seats in 1982, and Jimmy Carter lost 15 House seats in 1978.

While each of these elections had unique circumstances, the overall trend strongly suggests that within two years, the electorate shifted ownership of the economy – and blame for current conditions – to the new president (and his party).

However, there is an important outlier: FDR. In 1934, Roosevelt saw his party gain nine seats. He took over in the midst of the Great Depression, when Americans wanted a president who would take decisive action to address the economy. The country wanted a president who wasn’t, well, Herbert Hoover. All of which sounds quite familiar.

If this is the worst economic crisis since the Great Depression (as it is frequently described by politician and pundit alike), looking ahead to November 2010, will the public give Obama and the Democrats more time to turn the economy around? And will the public respond to a bold economic agenda as it did in 1934?

The answer to these questions may well determine the outcome of the 2010 elections, but current indications are that people continue to blame Bush and give Obama the benefit of the doubt. How long that continues could well be the key to the 2010 elections.