With a momentous election approaching, the American public has been buffeted by nerve-wracking volatility in the markets, blame mongering in the media, and debates among experts over the prospects of a financial meltdown. Surprisingly, however, Americans appear to be taking the crisis in stride. According to a new poll from the Pew Research Center for the People and the Press, most Americans believe we are in a recession, but they are not panicking and they expect it to be over next year, partly because they retain confidence in the government's ability to fix the situation. Their attitudes may give leaders and policymakers some latitude to devise solutions—but not to overreach.
The Pew survey, one of the most respected in the business, was conducted October 9–12 among 1,485 adults reached on landlines and cell phones. The latest one conformed with the findings of others on the presidential contest, a good sign of its likely accuracy. But the answers to its questions about the financial crisis are in some respects counterintuitive.
After hearing the candidates blame greed and corruption on Wall Street or lax regulations in Washington, Americans are taking a more sensible approach, the survey suggests. Asked to list the causes of the crisis, 79 percent said it was "people taking on too much debt" and 72 percent said "banks making risky loans." While the candidates resist pointing the finger at Americans themselves, in other words, the public's views seem more in line with the famous dictum of Pogo the cartoon possum: "We have met the enemy and he is us."
Only 46 percent in the survey blamed "weak government regulation," which is interesting because both Barack Obama and John McCain seem to agree on that one. Not surprisingly, however, far more Democrats than Republicans were of that view. The Americans surveyed do agree that business leaders are greedier than in the past, but their views of government are more negative than any time since the late 1990s. Nearly six in ten say that "government is almost always inefficient and wasteful." This suggests to me that a new President and Congress must be cautious about drastically expanding the role of government regulation and spending.
"Basically this poll says that the public thinks that the fundamentals are OK, but we're in for a rough patch," Andrew Kohut, president of the Pew Research Center, told me. "On the other hand, they think we're not about to fall off a cliff. That's probably a pretty temperate almost conservative way of looking at things. There is no hue and cry for government regulation. Government remains pretty low in the public's estimate."
The survey also found that Americans now say that "people should learn to live with less" and their cutbacks on vacations, restaurant meals, household purchases, and cars are accelerating. These results suggest that if there is another tax rebate as part of an economic stimulus plan, the public may not be inclined to spend the money.
The full report, "Public Not Desperate About Economy or Personal Finances," is available on the Pew Research Center for People and the Press website.