CNBC: Democrats and Republicans agree: I’m doing better than everybody around meOctober 31, 2016 | By Fluent
Publication date 10/28/2016
Democrats think the economy is doing fine. Many Republicans think it’s not. But no matter their party, Americans think they’re personally doing better than everybody else around them.
Still, many people say things are going downhill for the economy — but for someone else’s economy. Three-quarters of Americans think the economy is heading in the wrong direction, according to data from Fluent, a marketing and advertising firm, but they’re more confident about their personal economic situation.
Eighty percent feel some degree of security about their financial future. (That is, lumping together those who feel “completely,” “highly” or “mostly” secure.) And that figure has barely budged in the seven months that Fluent has been running that survey.
The disconnect illustrates how economic reality can seem dramatically different for people depending both on their personal situation and political leanings.
“Even though data indicates the economy is in the best shape it has been in years, more Americans feel economically vulnerable,” said Andrew Ribner, director of research at Fluent. “They are constantly reminded in apocalyptic terms from both sides of the political spectrum that the system is rigged favor of powerful interests working against them.”
It’s possible that respondents give politically motivated answers to questions on the overall economy, but are more honest when it comes to personal questions.
‘Local’ situation is better than the ‘global’ one
Data from CNBC’s All-American Economic Survey show a similar pattern: In mid October, 30 percent of Americans said they thought the economy was in a “poor” state, but only 4 percent expect their wages to decrease over the next 12 months. Thirty-six percent think their home will increase in value in the next year.
Jay Campbell of Hart Research — who helps conduct CNBC’s survey — said that type of personal confidence isn’t limited to issues of economics. “The classic example is elected officials: People hate Congress, but generally they like their own congressperson,” he said. “So part of it is people think their ‘local’ situation is better than the ‘global’ one.”
Politically minded confidence
Our understanding of the country’s economic future can be strongly influenced by outside factors such as the media we consume and our political allegiances. Democrats are far more likely to express faith in the economy of recent years than Republicans, according to an ongoing survey from Gallup. The polling firm’s Economic Confidence Index shows a dramatic difference in Americans’ faith in the future.
The Gallup index is a combination of two other components: how respondents feel about the current state of the economy, and their confidence that it’s headed in the right direction. The index vacillates between a possible +100, which would mean that all Americans think the economy is in great shape and headed in the right direction, and -100, which would mean no one feels that way.
Democrats’ confidence in the economy had been falling in parallel with Republicans’ for much of 2015 and the first half of 2016. Following the Democratic convention in July, however, that figure jumped dramatically among Democrats in August to +26.
It could be that the Republicans polled would consciously say anything against the economy under a Democratic president, regardless of their actual views and experiences. On the other hand, individuals’ feeling that the economy has gone in the wrong direction under President Obama could have driven them to identify with the Republican party. It’s a chicken or the egg situation.
Distrust of ‘official’ data
That disconnect between macro economic trends and individual people’s situations also feeds into a growing trend where people no longer trust official statistics. People often don’t see the government’s reported economic improvement reflected in their lives, and therefore don’t believe it’s actually happening.
Social media plays a role, allowing people in geographically distant parts of the country to meet and share their experiences, often finding common ground in economic hardship. Social media information flow also leads to like-minded individuals exchanging more and more isolated ideas among groups of people who think similarly.
“The increasing polarization of news through social media allows liberals and conservatives to live in different versions of reality,” Timothy B. Lee wrote recently at Vox. Those differing realities could be a part of why people see their personal situation so differently from the economy as a whole.
It also leads to distrust of political polls and pollsters’ statistical methods. That’s one reason Donald Trump’s supporters swear their candidate is actually winning, despite practically all professional polls showing otherwise.
Sometimes, statistical traditions become outdated with the shifting world. As we have reported, the “official” unemployment rate has returned to normal levels since the recession, but other metrics of employment have been more stubborn. As more workers have taken part-time positions because economic factors have made them, they would be left out of the official unemployment rate of 4.9 percent, but would be included other, more broadly defined metrics.
That doesn’t mean the official unemployment rate is wrong, only that it’s measuring something that might be less important to a certain segment of the workforce.