The economy and the election
Source Ravi
Date 04/10/12/20:05

The dismal science bites back
Oct 7th 2004 | WASHINGTON, DC
From The Economist print edition

George Bush comes out worst in our poll of academic economists

WOULD John Kerry or George Bush do a better job stewarding America's
economy? Judging by the polls, voters are not sure. Within the past
couple of months both candidates have had narrow leads on the issue. Ask
economics professors, however, and you get a clearer answer.

In an informal poll of 100 academics, conducted by The Economist, Mr
Bush's policies win low marks. More than 70% of the 56 professors who
responded to our survey rate Mr Bush's first-term economic policies as
bad or very bad. Fewer than 20% give positive marks to Mr Bush's
second-term economic agenda, and almost six out of ten disapproved. Mr
Kerry hardly got rave reviews either, but his economic plan still fared
better than the president's did. In all, four out of ten professors
rated Mr Kerry's economic plan as good or very good, but 27% gave it
negative scores. (The complete numbers are available at

Are our economists partisans? We chose their names, at random, from
among the referees of the American Economic Review, one of the
profession's more prestigious publications. Conservatives often moan
that university professors are all left-wingers. Though most of our
professors claim they are not interested in working in Washington, 80%
of those who would accept a policy job would prefer to work for Mr
Kerry. However, even if you allow for some partisanship, the results are
fairly striking.

A third of the economists reckon the economy is in good or very good
shape; about half give a neutral response, and one in five deems the
economy to be weak. They are almost equally split about how much
responsibility the Bush administration deserves for the state of today's
economy. Just over a third assign some or all credit or blame to the
president; another third think he has had little or nothing to do with it.

Despite their diverse assessments of today's economy, the professors are
overwhelmingly critical of the central plank of Mr Bush's economic
policy?tax cuts. More than seven out of ten respondents say the Bush
administration's tax cuts were either a bad or a very bad idea, and a
similar proportion disapproves of Mr Bush's plans to make his tax cuts
permanent. By contrast, Mr Kerry's plan to roll back the tax cuts for
people with incomes over $200,000 wins the support of seven in ten of
them. (This poll was taken before October 4th, when Mr Bush signed into
law his fourth tax cut, which extended several popular components of
earlier tax cuts that were due to expire at the end of this year,
including the child tax credit.)

The broad condemnation of tax cuts seems to be linked to the professors'
worries about America's fiscal health and the looming retirement of the
baby-boom generation. Although Americans overall seem relatively
unconcerned about the budget deficit, a large majority of the economists
rate it as a serious problem for the economy, with almost one in five
describing it as a crisis. And they back Mr Kerry by a large margin (79%
to 18%) to do more to promote fiscal discipline than Mr Bush. In
contrast, the boffins seemed much less concerned by the current-account
deficit; only one respondent called it a crisis, and close to 20% deemed
it either a small problem or no problem at all.

Health care also seems to be an issue that pushed our economists towards
Mr Kerry. More than 70% of the academics reckoned health-care costs were
a serious problem for the economy?and they preferred Mr Kerry's plans to
control those costs by a margin of 59% to 25% (with the rest ducking the

There was some good news for Mr Bush on tax reform. More than 40% of the
academics hail his plan to simplify the tax code as a good or very good
idea?twice as many as think it bad or very bad. Mr Kerry's main
tax-reform proposal?ending the ability of foreign subsidiaries of
American firms to defer taxes on their profits?was less well received.
Around a third of the professors thought that was a good or very good
idea, a third were neutral, and a third thought it was a bad idea.

On entitlement reform, the academics' opinions are harder to interpret.
They are evenly split on the merits of Mr Bush's proposal to reform
Social Security by creating personal retirement accounts: 36% think it
is a good or very good idea, 38% a bad or very bad idea. Oddly, most of
them think Mr Kerry offers better plans for dealing with the
baby-boomers' retirement, even though he has not actually made any
concrete proposals for entitlement reform.

One area where the economists clearly favour Mr Bush is trade. Mr
Kerry's ranting about outsourcing has irritated economists: a huge
majority dismiss outsourcing as either a small or non-existent problem,
and almost 60% give Mr Kerry's trade policy a bad or very bad rating.
Although they are plainly not wild about Mr Bush's record on trade, they
back him by a margin of almost two-to-one to do more to help free trade
and globalisation than Mr Kerry would.

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