BarroMetrics Views: US Government Showdown IV
Harry Reid, Senate Majority Leader, is reported to have persuaded Obama not to negotiate with the Republicans – citing the Clinton 1995 shutdown as evidence that the public opinion would force Republicans to back down. And if you listen, watch, and/or read mainstream US media, you may be led to believe that is what is likely to happen.
But, if you do your own digging, you may think otherwise. Let’s have a look at some polls:
- In 1995, Clinton’s approval rating (Gallop Poll) before the first shutdown was slightly over 50%; Obama’s is 41%; in 1995;
- in 1995 those that said the battle was about principles is the same as today’s 37%.
- For me the telling Gallop poll is the one that has asked about the current shutdown:
‘..thinking about the budget conflict….who do you think has acted more responsibly….-President Obama or the Republican leaders in Congress’
- The Republicans voted: Leaders 73 Obama 9%
- The Democrats voted: Leaders 9% Obama 77%
- The Independents voted: Leaders 33% Obama 34%
In short, what the polls tell me is this: the US of today is far more polarized than that in 1995. If so, then neither the Democrats or the Republicans will emerge with an edge from this crisis; a crisis that may prove to be longer than the 21 days that is so far the record shutdown. What the crisis may do is provide the death blow to the market’s trust in QE; the trust that says QE can indefinitely sustain US stocks.
In case you are wondering why I look at Gallop rather than say, for example, Fox or MSNBC …….I find that many US pollsters have their own axe to grind. I trust Gallop to be independent and objective.