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Obama's Approval Rating Dragged Down By Economic Disconnect
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Obama's Approval Rating Dragged Down By Economic Disconnect

Politics

Obama's Approval Rating Dragged Down By Economic Disconnect

Obama's Approval Rating Dragged Down By Economic Disconnect
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President Obama gets low marks for his handling of the economy — and that creates an opening for Republicans heading into next month's midterm elections.

AUDIE CORNISH, HOST:

Turning to the economy now. In the second quarter of the year, it grew at its fastest pace in nearly a decade. Corporate profits are up; unemployment is down. Despite all this, President Obama continues to get low marks for his handling of the economy, and that creates an opening for Republicans in next month's midterm elections. NPR's Scott Horsley reports.

SCOTT HORSLEY, BYLINE: President Obama sounded almost defensive reviewing his economic track record before an audience of business students at Northwestern University. He talked about the 10 million jobs private employers have added over the last four-and-a-half years, saying America's put more people back to work than Europe, Japan and the rest of the advanced economies combined.

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PRESIDENT BARACK OBAMA: By every economic measure, we are better off now than we were when I took office.

HORSLEY: Obama can point to other promising trends, including rising energy production, a falling federal deficit and a dramatic slowdown in the growth of health care costs.

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OBAMA: America's better poised to lead and succeed in the 21st century than any other nation on Earth.

HORSLEY: But polls suggest most Americans aren't sold on the recovery, and that's dragging the president's economic approval ratings down to about 40 percent. Why the disconnect? Maybe because while the economy is growing again, most people's paychecks are not.

PAVLINA TCHERNEVA: Basically, they haven't seen an expansion. Their incomes have shrunk.

HORSLEY: Pavlina Tcherneva is an economist at Bard College who studies the way pretax income growth has been divided during the past 10 business cycles. Back in the 1950s, income gains during good times were widely shared, with 90 percent of the workers collecting 80 percent of the extra income. But with each passing decade, those at the top of the income scale were grabbing a bigger and bigger share, until by the expansion of the 1980s, the bottom 90 percent of workers got just 20 percent of the gain.

TCHERNEVA: It sort of debunks that myth that a rising tide lifts all boats.

HORSLEY: In recent years, it's grown even more lopsided. Between 2009 and 2012, all of the income gains and then some flowed to the top 10 percent of earners, while average earnings for everyone else actually shrank. A few luxury yachts rose higher and higher while a flotilla of dinghies was taking on water. Tcherneva's research only goes through 2012, but White House economist Jason Furman admits there's been no real improvement since then.

JASON FURMAN: Over the past year, wage growth has picked up. But it's still, you know, sort of neck-and-neck with inflation and nowhere near what workers deserve based on, you know, their productivity growth and what they're adding to this economy.

HORSLEY: The one business cycle when those beyond the top 10 percent enjoyed relative gains in income was the 1990s when a red-hot job market allowed even those in the middle of the pack to demand raises. Workers today can only dream about that kind of bargaining power. Obama said yesterday there's no silver bullet to restore that kind of wage growth, but he offered several well-worn prescriptions that he says can help, including more spending on public works programs, better and more affordable education and a higher minimum wage.

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OBAMA: American economic greatness has never trickled down from the top. It grows from a rising, thriving middle class and opportunity for working people. That's what makes us different.

HORSLEY: Republican Party Chairman Reince Priebus countered with his own familiar suggestions, telling an audience at George Washington University the federal government needs to cut spending and red tape.

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REINCE PRIEBUS: Bureaucrats, lobbyists, out-of-touch politicians need to get out of the way and give American workers and businesses the freedom to create jobs.

HORSLEY: The back-to-back speeches were designed to frame the two parties' economic platforms in advance of next month's elections. But no matter which side voters come down on, pushing an agenda through divided government will continue to do be difficult, if not impossible. For now, the U.S. economy is expected to keep growing at a steady but slow pace. Economist Tcherneva warns, though, that a rising tide that lifts only the biggest boats is not likely to keep rising very long. Scott Horsley, NPR News, Washington.

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