GOP talk of vibrant economy rings hollow
By LIZ SIDOTI, Associated Press Writer
Mon Sep 18, 3:15 AM ET
FALMOUTH, Ky. - Used boots fetch $3 and old salt-and-pepper shakers bring in a buck at a makeshift flea market along Highway 27, presumably not what President Bush and Republicans have in mind when they herald a vibrant economy.
Times are "very good for the rich and very, very bad for the poor" who "can't afford to live," laments Larry Mitchell, 43, a now-and-then merchant peddling his wares recently in a submarine sandwich shop parking lot. He says the middle class is "having a hard time."
In the Ohio River Valley, where people decry high gas prices, stagnant wages, lost jobs and factory closures, many don't buy the claim that the economy is humming along.
Seven weeks before the midterm elections, the gulf between Bush's perceptions and that of voters form the political backdrop across the country as well as in a region with several competitive House races. This area typically gets left out of national boom times and usually feels the pinch more than others during slowdowns.
Here and elsewhere differing views on the economy could hurt the GOP's efforts to retain control of the House and Senate this fall, and give voters reason to put Democrats in charge instead.
In Washington, the economist in chief encourages GOP candidates to embrace the economy as a stellar accomplishment. "I'd say 'Look at what the economy has done. It's strong. We've created a lot of jobs,'" Bush said recently.
So, Republicans hit the campaign trial with a rallying cry that 5.7 million jobs have been created since August 2003. They cast Democrats as tax-raisers who would bring economic gloom and doom.
"President Bush and the Republicans are out of touch with Americans who are living paycheck to paycheck and are struggling to make ends meet," House Minority Leader Nancy Pelosi, D-Calif., counters.
Her rank-and-file portrays an economy under Republicans that leaves behind the poor and hinders the middle class. Democrats also complain about a soaring federal deficit and Bush's tax cuts "for the wealthy" during wartime.
Nationally, the economy grew strongly at the beginning of this year but it has slowed, reflecting the toll of high energy prices and two-plus years of interest-rate pain from the Federal Reserve. Gasoline and other energy prices now are falling and the Fed is expected to stay on the sidelines for a while after halting its rate-raising campaign last month.
Economic growth through the rest of the year is expected to stay relatively subdued. However, most economists don't believe the economy is in danger of falling into recession.
Hiring, which has been uneven this year, picked up in August, pulling the nation's unemployment rate down to 4.7 percent. At the same time, wages are rising. However, inflation has taken a bite out of workers' paychecks and put the squeeze on some family budgets.
The mixed picture could have consequences for Republicans who control Congress.
"They could very well be held accountable on the economic front," said Robert Shapiro, a public opinion expert at Columbia University in New York.
A recent Associated Press-Ipsos poll found that Democrats have a 22-point edge among likely voters who care deeply about the economy, with 57 percent saying they're more likely to vote for Democrats and 35 percent indicating they probably would lean Republican.
It's also possible that the country's economic vitality may not be much — if any — consequence to the political party in power.
In the poll, more likely voters ranked the situation in Iraq and terrorism as "extremely important" to them personally than the economy. And, an AP analysis found that while most likely voters rated it an important issue, the economy isn't driving their vote in November.
A dozen years ago, when Republicans came into power in Congress, health care and crime were more important to voters than the economy. Exit polls from 1994 show that 22 percent of voters picked the economy as their most important issue, compared to health care, 30 percent, and crime, 25 percent.
This campaign season, Bush has been championing his economic policies but public sentiment over his job performance on the economy remains sour.
Only 40 percent of likely voters in an AP-Ipsos poll conducted last week said they approve of how he's handled the economy.
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Economic strength is a perpetual concern in the factory-and-farmland Ohio River Valley that mainly encompasses parts of West Virginia, Ohio, Kentucky and Indiana, four states that all saw their unemployment rates rise from June to July.
Kentucky's was 6.3 percent, Ohio's was 5.8 percent, Indiana's came in at 5.7 percent and West Virginia's at 5.4 percent — all higher than the national average.
Voters in these states and others wince at suggestions of a robust economy.
"It's just scary," said June Meredith, 49, a self-employed caterer, as she passed along talk of business closures at the Cake Ladies Dream Shoppe along a not-quite-bustling road in New Albany, Ind.
In this region full of commuters, voters bemoan the "trickle down" effect of high gas prices — even though they had dipped from $3 a gallon to $2.61 in Lexington, Ky., one recent week.
"Everything from a loaf of bread to a pair of shoes," seems to cost more, said Ronald Barrett, 70, a Democrat supervising a group doing community service on Scottsburg's quaint town square in Indiana.
At a nearby diner, waitress Jeanine Gordon, 32, who makes the minimum wage, mused about her latest trouble — her van has been in the shop for a week because she and her husband can't afford to fix it.
"This is the least I've ever made in my entire life," the Republican and mother of three said. "The gas prices went up and the tips went down."
In Butler, Ky., business could be better at Thaxton's Canoe Trails and Paddler's Inn, where a six-mile trip on the Licking River costs $15.95 per person and a one-night "cozy cabin" stay for two goes for $59.99.
"People don't want to spend money, and the ones that do want to spend money do it sparingly," said Glen Thaxton, 25, a ponytailed Republican who voted for Democrat John Kerry in 2004. He took over the family business recently, and says he hopes to boost business.
To the south, in New Castle, Ky., Debbie Brewer, 50 and a deli owner, rattled off her biggest complaints about the economy as she counted change while closing her register for the night.
"We'll never see 99 cents again," the Republican said of gas prices. "Everything's jumping — your gas, your food and everything — but your wages don't go up."
After a moment, she cracked a smile and chuckled: "I sound like a Democrat!"
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