Consumers discouraged by economy, 2 polls say

August 14, 1993|By New York Times News Service

WASHINGTON -- Two widely followed consumer confidence polls taken in the first half of August show Americans are even more discouraged about the economy and their own financial situations than they were before the Aug. 6 vote on President Clinton's budget.

This suggests that most consumers, already as depressed about economic prospects as they were when George Bush was president, have not bought the Clinton administration's assurances that its plan will help get the economy moving and benefit all but the richest Americans.

"There is no question that our opponents have been very successful in misleading average Americans about the tax implications in our plan," said Gene Sperling, deputy assistant to the president for economic policy.

A regular weekly poll by ABC and Money magazine showed a sharp deterioration in confidence immediately after the budget vote on Aug. 6.

The index, based on a telephone poll of 125 families Aug. 7-8, fell a sharp seven points from the previous week, from -32 to -39.

While consumers' views of the national economy and buying conditions changed only slightly from the previous week, the fraction who reported that their personal finances were in bad shape jumped from 46 percent to 53 percent, the biggest weekly jump in the poll's history.

A second poll, a proprietary survey by the University of Michigan -- whose results are incorporated into the government's official forecasting gauge -- showed that the consumer mood, already dismal, worsened in the first half of August.

Its consumer sentiment index, based on a telephone poll of 280 families in the first half of this month, declined from 77 points, to 75.4 points -- the lowest level since the winter of 1992 and down sharply from 83 points last December. The proportion of respondents who expected the economy to get worse in the next year jumped from 69 percent in July to 80 percent in the first half of August.

Two results in the Michigan poll particularly concerned administration officials.

One showed that 9 percent of Americans approved of the nation's economic policies in early August while 36 percent disapproved, the same proportion as in July. The other showed that, by a margin of 5 to 1, consumers described the news they had heard about changes in economic policy in negative terms.

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