WASHINGTON, Oct. 14, 2011 /PRNewswire/ -- After a summer of contentious battles over the federal debt ceiling, tumult in the stock market, renewed concerns about the global economy, and anxiety about a "double-dip" recession, Americans have become skeptical about borrowing, even to finance growth -- and they think Washington should be, too. According to poll results announced today by The Allstate Corporation (NYSE: ALL) and National Journal, nearly eight in 10 Americans believe the federal debt and deficit have a meaningful impact on their personal finances. Concerns about that impact are fueling a strong preference for deficit reduction over stimulus spending.
The 10th quarterly Allstate-National Journal Heartland Monitor Poll explored Americans' experiences with and attitudes toward debt, both on a personal level and in government spending. The results reveal a population that views taking on personal debt as an obstacle to – rather than an investment in – achieving the American Dream. That view is mirrored when it comes to federal debt, as 56% of respondents say reducing the debt and deficit needs to take priority over additional government spending to stimulate the economy.
Americans are increasingly skeptical about the federal government's role in the economy, with 40% now saying government is the problem, rather than the solution, when it comes to the economy, up from 36% in May 2011. Another 29% say they would like to see the government play an active role in ensuring economic benefits, but are not sure they can trust the government to do so effectively, while 27% support an active government without those reservations. A full 71% of respondents say they are not confident in Washington's ability to reduce the federal budget deficit.
"The poll's message is that Washington and the business community need a new approach to leadership and a renewed focus on issues that are the building blocks of family security," said Joan Walker, Allstate executive vice president. "The American people overwhelmingly expect leaders from every field, community and business to compromise and solve America's economic problems together, from making sound budget decisions to creating more jobs."
According to the poll results, Americans are practicing what they preach on a personal level. Nearly half of the poll's respondents said the economic downturn had encouraged them to reduce their debt, even if it meant cutting back on spending. Only one in eight said they had borrowed more money in order to get by. Just 39% agreed that "personal debt provides a path to achieving the American Dream by making it possible for people to borrow against their future earnings," while a solid 56% majority said that "personal debt creates an obstacle to achieving the American Dream by encouraging people to spend beyond their means."
"The consistent preference expressed in the poll for reducing debt – both individually and collectively – suggests that, like the Depression, the Great Recession could have a lasting impact on how today's Americans borrow and spend throughout their lives," said Ronald Brownstein, editorial director of National Journal Group. "At the least, it's clear that the fierce downturn has triggered a profound moralistic streak in millions of Americans who equate debt with profligacy, and profligacy with an erosion of the discipline required for economic success, both individually and as a nation."
Key findings from the 10th Allstate-National Journal Heartland Monitor Poll (PDF) include:
1) Americans' concerns about the economic impact of federal debt are fueling a preference for deficit reduction over stimulus spending.
- 79% of Americans believe that the federal government's budget deficit and debt has a "great deal" of impact or "some" impact on their personal finances.
- 56% say that deficit spending during an economic downturn is the wrong approach because it increases long-term debt instead of growing the economy by cutting spending and not raising taxes.
- 38% say that deficit spending during a downturn is critical because the government has the unique ability to stimulate the economy through public investment that lowers unemployment and encourages spending.
- 55% of Democrats support spending to stimulate the economy, while 74% of Republicans prefer cutting spending and not raising taxes. Independents side mostly with Republicans, preferring spending cuts over stimulus by a 59%-36% margin.
2) Americans are skeptical about the federal government's role in the economy and its ability to reach an agreement on the budget deficit.
- Americans hesitate to endorse an active role for the government.
- 40% say that in the current economic environment, government is not the solution to our economic problems – it is the problem.
- 29% say they'd like to see the government play an active role in ensuring the economy benefits people like them, but they are not sure they can trust the government to do so effectively.
- 27% believe that the government must play an active role in regulating the marketplace and ensuring that the economy benefits them.
- The Heartland Monitor series has tracked this question since January 2010, across five surveys. By a small margin, this "government is the problem" sentiment is the highest tested thus far, indicating a steady and slightly increasing mistrust of government's role in the economy.
- Americans express little confidence in Washington's ability to reach an agreement to reduce the federal budget deficit.
- 71% say they are "not too confident" or "not confident at all" in elected officials' ability to reach an agreement.
- Just 28% say they are "very" or "somewhat" confident.
3) Most Americans believe that personal debt creates an unwanted obstacle that they are eager to pay off.
- A majority of Americans reject the idea that personal debt provides a path to the American Dream.
- 56% believe that personal debt creates an obstacle to the American Dream by encouraging people to spend beyond their means and burdening them with years of interest payments.
- 39% believe it provides a path to the American Dream that allows them to borrow against future earnings to pay for college, a home, a car, or to start a business.
- The economic downturn has encouraged many Americans to take steps to pay off debt or not take on any new debt.
- 47% say the downturn has encouraged them to pay off debt or not take on new debt, even if that meant cutting back spending.
- Only 12% say the economy has required them to take on more debt to meet their daily expenses.
4) Americans remain pessimistic about the direction of the country, and President Obama's approval rating has eroded slightly across the poll series. However, there is a remarkable consistency to the trend data, indicating that most Americans have deeply rooted opinions about the President's impact on the country and on the economy.
- 70% of Americans believe that things in the country are "seriously off on the wrong track," while only 20% believe the country is "headed in the right direction."
- Americans' pessimism is at its highest point in the 2.5-year history of the Heartland Monitor Poll.
- The President's approval rating is 44%, lower than it has been in the nine previous polls.
- 41% of Americans say they would vote to re-elect President Obama, while 51% say they would vote for someone else.
- 40% say they trust President Obama to develop solutions to the country's economic problems, while 33% would trust Republicans in Congress, and 20% say they would trust neither.
- 11% believe the country is significantly better off because of the policies President Obama has pursued. 42% say the country is not significantly better off, but beginning to move in the right direction because of his policies. 41% say the country is significantly worse off because of the president's policies, including new lows for the president among white voters and independents.
Notes to Editors
A nationally representative survey of American adults conducted September 28 – October 2, 2011, among N=1,000 American adults age 18+. Respondents were reached via landline and cell phone. The survey has a margin of error of +/-3.1%.
The Allstate Corporation (NYSE: ALL) is the nation's largest publicly held personal lines insurer known for its "You're In Good Hands With Allstate®" slogan. Now celebrating its 80th anniversary as an insurer, Allstate is reinventing protection and retirement to help nearly 16 million households insure what they have today and better prepare for tomorrow. Consumers access Allstate insurance products (auto, home, life and retirement) and services through Allstate agencies, independent agencies, and Allstate exclusive financial representatives in the U.S. and Canada, as well as via www.allstate.com and 1-800 Allstate®. For an overview of the other Allstate-National Journal Heartland Monitor Polls, visit http://www.allstate.com/heartland-monitor. Additional information is available at www.storiesfromtheheartland.com.
About National Journal Group
National Journal is Washington's premier source for 360-degree insight on politics and policy. With up-to-the-minute breaking news and analysis at NationalJournal.com, the essential intelligence of National Journal Daily, the knowledge and depth of National Journal magazine, and the comprehensive campaign coverage of National Journal Hotline, National Journal delivers everything you need to know to stay ahead of the curve in Washington.
About the Strategic Communications Practice of FTI Consulting
The Strategic Communications practice of FTI Consulting, formerly known as FD, is one of the world's most highly regarded communications consultancies. With more than 20 years of experience advising management teams in critical situations, the Strategic Communications practice supports clients in protecting and enhancing their reputation in the capital markets, society and the political environment. Services of the Strategic Communications practice are financial communications, corporate communications and public affairs, with specialty offerings that include strategy consulting, research, creative engagement, crisis and issues management, and change communications. The Strategic Communications practice of FTI Consulting is an established market leader in M&A communications and has been for many years.
About FTI Consulting
FTI Consulting, Inc. is a global business advisory firm dedicated to helping organizations protect and enhance enterprise value in an increasingly complex legal, regulatory and economic environment. With more than 3,700 employees located in 22 countries, FTI Consulting professionals work closely with clients to anticipate, illuminate and overcome complex business challenges in areas such as investigations, litigation, mergers and acquisitions, regulatory issues, reputation management and restructuring. The company generated $1.4 billion in revenues during fiscal year 2010. More information can be found at www.fticonsulting.com.
SOURCE The Allstate Corporation