Collapse of Household Net Worth Isn't News to Most Americans
A Commentary By Scott Rasmussen
Friday, June 15, 2012
The new Federal Reserve report showing that household net worth collapsed between 2007 and 2010 quickly became campaign fodder for both sides.
Republicans seized on the data to claim that the current administration is out of touch. President Obama helped the GOP with his comments that the private sector is doing fine and that small businesses will not be affected by his health care plan.
Democrats correctly pointed out that most of the collapse occurred on George W. Bush's watch, not Obama's. They also noted that things have gotten a bit better between 2010 and 2012.
Clearly, there is data in the report to help both sides. But while a 40 percent decline in household net worth may have been stunning news in Washington, D.C., it wasn't news to most Americans. They have experienced the decline day after day for the last five years.
As 2007 began, 38 percent of Americans thought the U.S. economy was in good or excellent shape. That fell to 8 percent in 2009 before inching up to 11 percent at the beginning of this year and 15 percent last month.
The Fed report noted that the housing market was largely to blame for the declining net worth. Again, that was no surprise to anyone outside of Washington. In 2008, 80 percent of homeowners believed their home was worth more than they paid for it. Just 49 percent have such optimism today. And more believe the value of their home will decline rather than increase over the coming year.
Perhaps the most dramatic changes have occurred on the jobs front. As 2007 began, 29 percent of workers reported that their firms were hiring. Just 13 percent reported layoffs. Two years later, during Obama's first month in office, the numbers were just about reversed. Only 14 percent reported hiring, and 30 percent said their employers were reducing staff. Today, the numbers are essentially even, with equal numbers reporting growing and shrinking payrolls.
Collectively, the data shows that Americans perceive the economy as a bit better than it was in 2010 but not nearly as strong as it was in 2007, and there are doubts as to whether the housing market is any stronger. The Rasmussen Consumer Index shows that consumer confidence fell from a high of 118.8 in January 2007 to half that level in early 2009. It is now back to the high 80s.
Team Obama would like to frame the debate around the fact that confidence has rebounded and is up by more than 20 points since the current president took office. Republicans would like to focus on the fact that confidence is still down more than 30 points over the past five years.
For most voters, the political arguments, campaign tactics and reports from the Federal Reserve will be largely irrelevant on Election Day. What matters most is the reality they experience on a daily basis. That brings us back to the question Ronald Reagan made famous three decades ago: "Are you better off today than you were four years ago?"
That's the kind of hope and change Americans were looking for when they elected Obama. At the moment, they don't think the president has delivered. Consumers rate their personal finances the same as they did on the day he was inaugurated. If that doesn't improve by November, there's likely to be a new president in January.
COPYRIGHT 2012 SCOTT RASMUSSEN
DISTRIBUTED BY CREATORS.COM
See Other Political Commentaries.
See Other Commentaries by Scott Rasmussen.
Rasmussen Reports is a media company specializing in the collection,
publication and distribution of public opinion information.
We conduct public opinion polls on a variety of topics to inform our audience on events
in the news and other topics of interest. To ensure editorial control and independence,
we pay for the polls ourselves and generate revenue through the sale of subscriptions,
sponsorships, and advertising. Nightly polling on politics, business and lifestyle topics
provides the content to update the Rasmussen Reports web site many times each day.
If it's in the news, it's in our polls. Additionally, the data drives a
daily update newsletter and various media outlets
across the country.
Some information, including the Rasmussen Reports daily Presidential Tracking Poll
and commentaries are available for free to the general public.
Subscriptions are available for $4.95 a month or 34.95 a year
that provide subscribers with exclusive access to more than 20 stories per week on upcoming elections,
consumer confidence, and issues that affect us all. For those who are really into the numbers,
Platinum Members can review demographic crosstabs
and a full history of our data.
To learn more about our methodology, click here.