Yeah, it’s the economy

OPINION:

By now, Mitt Romney knows whether his commitment to resurrect tens of thousands of auto jobs in Michigan was enough to bring him victory in yesterday’s Republican primary in that Midwestern state, which has the highest unemployment rate (7.4 percent) in the nation.

Throughout the primary campaign in Michigan, Mr. Romney promised to “end the one-state recession in Michigan.” History may record that he was talking about the “good, old days.” Indeed, the news about the U.S. economy is getting worse from one day to the next.

Yesterday, the Commerce Department reported that retail sales dropped in December, as retailers experienced their weakest year since 2002. Also yesterday, two of America’s largest financial institutions — Citigroup (the nation’s biggest bank) and Merrill Lynch (the country’s largest brokerage) — revealed that they had to rely upon foreign investors from the Middle East and Asia to replenish tens of billions of dollars of capital lost after the housing bubble burst and the mortgage crisis erupted. (DataQuick, a real estate information clearinghouse, reported yesterday that the median price for a Southern California home had declined 13.3 percent over the past year and that December home sales were 45 percent below their level a year ago. The Orange County Register reported yesterday that foreclosures in that Southern California county had increased nearly 550 percent last year.)

With unemployment soaring in Michigan and housing prices plummeting in California, voters in New Hampshire, according to last week’s exit polls, revealed that East Coast residents were also pessimistic. Among voters in the Democratic primary, 98 percent were either “very worried” (58 percent) about the economy or “somewhat worried” (40 percent). Voters in the Republican primary weren’t very happy either; 25 percent said they were “very worried,” and 55 percent said they were “somewhat worried.”

The percentage of adults who identified “economy/jobs” as the “single most important issue” in their choice for president increased from 11 percent in September to 29 percent today, according to the latest ABC News/Washington Post poll. In January 1992, nine months after a recession had ended and nine months before voters returned a Democrat to the White House, 47 percent believed the economy was getting worse and 8 percent thought it was getting better, according to a CBS News/New York Times poll. This month, before an economic downturn has been officially identified, 62 percent believe the economy is getting worse compared to 4 percent who believe it is getting better. The makings of a recession are in the wind. “It’s the economy, stupid” appears to have returned.