BUT WHENEVER I WATCH MY 50 INCH TV OR PLAY ON MY NEW COMPUTER....:

A Skeptical Take on the Economy: Best-selling author Keith McFarland argues against getting overly concerned about the bad economy (Keith McFarland, 6/27/08, Business Week)

It would seem that there really are two Americas, at least two American economies—the real economy and the perceived one. At first glance, the discrepancy can be explained by decreasing home prices and increasing energy costs. Home prices inform the fundamental wealth identity of most Americans, and fuel prices provide a weekly reminder that a fundamental change has taken place.

But there is an even greater discrepancy than the one between the real economy and the perceived, and it cannot be explained solely by the volatility in housing and energy. What really accounts for it is the way most Americans view their own situation and their impression of the economy as a whole.

In November 2007, only 19% of respondents to an Investor's Business Daily/TechnoMetrica Institute of Policy & Politics poll answering the question: "Do you consider yourself to be a part of America's haves or part of America's have-nots?" described themselves as "have-nots." An astounding 75% of the overall sample described themselves as "haves." In a 1988 Gallup survey with similar demographics, only 59% considered themselves "haves."

Even more striking is a Harris Poll that asked: "If you compare your present situation with five years ago, would you say it has improved, stayed about the same, or gotten worse?" A full 82% reported that their situation had improved or held steady. In response to the question: "In the course of the next five years, do you expect your personal situation to improve, stay the same, or get worse?" most people anticipated a bright future. Sixty-two percent expected improvement, with only 7% expecting their situation to get worse.

The truth is our impressions of our own economic well-being are based on actual experience, while our impressions of the national economy are shaped by the Chicken-Little loop of the media. The bad news is: The prognosis is not encouraging. With the increasingly competitive demands of the 24/7 news cycles, the doomsday drumbeat will only intensify. It seems that by today's media standards the traditional tempest in a teacup is unsatisfactory and is yielding to the perpetual quest for the Category 5 hurricane in a thimble.

...they tell me how bad off everyone else is...

Posted by Orrin Judd at June 29, 2008 7:41 AM