Is The Economic Glass Half-Full Or Half-Empty? It Depends
The pace of hiring in the U.S. slowed last month. Employers added just 138,000 jobs. But the unemployment rate dropped to 4.3 percent, the lowest it has been in 16 years.
The monthly snapshot from the Labor Department is one of the most closely watched indicators of the health of the economy.
No matter what the numbers actually say, how we feel about them is often colored by politics.
For the first time in a decade, most Americans are feeling good about the economy. A survey this spring by the Pew Research Center found nearly 6 in 10 think the economy is in good shape. That is up 14 points from a year ago.
Nearly all of the gain has come from Republicans, who are now twice as likely to say the economy is doing well as they were last year, even though actual conditions haven't budged much.
"There's no big change in the economy. Clearly, the change is the election and the politics," says Nariman Behravesh, chief economist for IHS Markit. "Obviously, there's some people who like what happened and some who don't. The politics is sort of outweighing the economics."
You see a dramatic display of that in Wisconsin, where surveys before and after the November election found a stark partisan flip-flop in economic expectations. Democrats are now much more pessimistic about the economy than they were before the election, while Republicans are more than three times as likely to think the economy is going to get better.
"There's nothing irrational in partisans believing that a change of government will dramatically improve the outlook of the economy," says Charles Franklin, who conducts the poll for Marquette Law School.
But the election didn't just change people's expectations for the future. It also changed their feelings about the recent past. President Trump had been in office less than two months when Franklin conducted his most recent survey, and already, four times as many Republicans said the economy had gotten better in the last year than said so in October.
"It's really hard to see how people change their views of the past, except that our perceptions of the economy are filtered through partisan lenses," Franklin said.
When he was running for president, Trump often dismissed encouraging economic indicators as "phony." Now he celebrates every positive bit of news. This past week, he boasted of "absolutely tremendous economic progress since Election Day on Nov. 8. The economy is starting to come back, and very, very rapidly."
Franklin says it has long been the case that Americans are more satisfied when their own party controls the White House. But the trend lines for both Democrats and Republicans used to go up and down together, in response to real world conditions. However, over the past dozen years or so, those lines have become untethered from each other. Partisan differences now seem to carry more weight than our shared national experience.
"How do you have responsive politics if in fact the public is seeing two such different worlds?" Franklin asked.
Much of this partisan filtering is not even conscious.
"It would be one thing if we put on rose-colored glasses, and we knew we were doing it," Franklin said. "But I'm afraid with a lot of political perceptions, the color of our glasses is something we don't even think about. And when the party in control switches, we switch the shade of our glasses, without really much consideration of that."
Those partisan lenses probably wouldn't blind people to another deep recession or a genuine boom. But so long as the economy is chugging along in fits and starts, there's lots of room for partisan interpretation.