- The Washington Times - Thursday, July 25, 2002

Republican leaders around the country say the stock market's long decline has sparked anxiety, fear and anger among voters.
"You see and hear and feel anxiety and concern, but it hasn't translated politically yet. At some point, it probably will," said Florida Republican Chairman Al Cardenas. "The ball is in our court, and it's up to us to give the public a sense that we our going to get our arms around the problem."
Mr. Cardenas' public worries, echoed by other Republican chairmen this week, came as some polls showed President Bush's approval ratings falling into the mid-60s, down from the mid-70s just a week ago.
Mr. Bush's pollster, Matthew Dowd, predicted in a public memo in March that the president's historically high numbers would decline gradually as the election campaigns heated up and "Democratic partisans returned to the norm, and that is what is happening now."
A random survey by The Washington Times of Republican state chairmen found that many party leaders have been picking up increasing anxiety at the grass roots. For the first time, officials are saying they are worried about the effect the stock market's roller-coaster ride could have on their state races.
Republican leaders expressed fears that voters could vent their anger in the midterm elections, when the party in the White House traditionally loses seats in Congress, if the market does not bounce back during the next three months.
"You are hearing more talk about it in the last few days more than anything else and the effect it is having on the economy. They are watching their IRA and 401(k) reports and they are starting to get angry. And anytime the voters get angry, incumbents are endangered," said Ohio's Republican chairman, Robert T. Bennett.
"Do I think that this is raising fires right now [for Republicans]? No, but if it continues, the trend will concern me. There's not a lot of time left," Mr. Bennett said.
Wisconsin Republican Chairman Richard Graber said he is beginning to worry about what the fallout from the stock market's collapse will mean to his party's candidates.
"When you see the market falling 400, 500 points, people are concerned, and I worry about what that does to the Republican base of voters. We have a Republican governor here. This will be a very close race this fall, and we don't have a very large margin for error," Mr. Graber said.
Still, party chairmen are hopeful that legislation to crack down on corporate accounting abuses, which appears headed for passage and the president's signature before week's end, will restore investor confidence before the November elections.
Republicans also were breathing a sigh of relief at the nearly 500-point rise yesterday in the Dow Jones Industrial Average.
"I think we've hit bottom. I think come Labor Day we'll see some positive signs. A whole lot of paper wealth has gone out the door, though it is not clear who people blame for that," Mr. Graber said.
"But it does not take a rocket scientist that if they blame somebody, it is going to be people in office. I'm not sure if it will be 'throw all the bums out,' but if it continues the way it has over the past two or three weeks, there is a problem" for the Republicans, he said.
Democrats have been escalating their election-year attacks as rapidly as stock prices have been falling, blaming Mr. Bush and Republicans for the collapse.
But Republican strategists say the voters thus far are blaming businessmen rather than politicians.
"There's a lot of talk about the stock market. It's been front-page news. The Democrats are saying it's the fault of Bush and Republican policies, but people are not buying it here. They blame corporate executives," said Marty Ryall, Arkansas Republican chairman.
R. Glenn Hubbard, chairman of the White House Council of Economic Advisers, said yesterday that "in terms of the economy, the fears are a little overblown. If you take the decline [in the stock market] over the past few weeks, it might decrease GDP in worst-case assumptions as much as half a percentage point. That's bad and something to worry about but by no means comes close to a double-dip recession.
"The stock market's decline does have a drag on the economy. But I think the economy is in reasonable shape at this stage of a recovery," he said.
White House spokesman Ari Fleischer said yesterday that the president is not worried about his falling poll numbers.
"The president does what he thinks is right based on the merits. By many of the measures that you're seeing, the public continues to have large support of the president's handling of the economy, domestic issues, and strongly approves of the job he's doing," he said.
White House and Republican National Committee officials say they have been monitoring their state party leaders and so far see no deterioration in the Republican voter base.
But RNC officials were concerned enough about the situation to send party leaders Mr. Dowd's latest polling data.
While Mr. Bush's approval numbers have come down from their highs after the September 11 terrorist attacks, "he is still experiencing historically high approval ratings," Mr. Dowd said.
"Nonetheless, we still expect [Mr. Bushs] average drop to continue, and the numbers should settle out around 62 to 64 percent by November," he said.
Other polls show that Americans are split evenly about whether the country is headed in the right or wrong direction.
Republican pollsters Public Opinion Strategies also found that confidence in the country's direction has dipped below 50 percent.
"While these issues individually might not cause much damage, they could be poised to collide and create a very different 2002 election cycle," the polling firm said in a news release.
Earlier this year, voters said by a margin of 2-to-1 that the country was on the right track; therefore, Democrats are encouraged that the number has dropped to below 50 percent.
"There are drastic differences in the 'right track-wrong track' numbers, where now a majority of Americans belive this country's going in the wrong direction," said Maria Cardona, communications director for the Democratic National Committee.
Mr. Dowd said this closely watched "right track-wrong track" number is just returning to its pre-September 11 level and that Republicans are in strong shape as the general election approaches. His memo reported a string of numbers to make his case.
"The following political dynamic exists today: one, the Republican Party has a two-point favorability advantage [over the Democrats]; two, the congressional generic ballot is even; three, Bush approval is approximately 73 percent; four, Bush approval on the economy is +23 percent over disapproval; and five, Bush's understanding of the average person is now +23 over not understanding," he said.
"It still looks as though the outcome of the November elections will be decided district by district and state by state," he said.
Joseph Curl contributed to this report.


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