Pedestrians carry shooting bags from Zara fashion store, operated by Inditex SA, in San Francisco, California, U.S., on Thursday, Dec. 26, 2019. Confidence among U.S. consumers advanced to a nine-week high on greater optimism about the economy and brighter views of personal finances and the buying climate. Photographer: David Paul Morris/Bloomberg
Low interest rates, an improving housing market and a stock market rally all helped to fuel voter optimism © Bloomberg

A year-end stock market rally and strong wage growth for low-income Americans have boosted public attitudes towards Donald Trump’s economic stewardship, with more than half of likely voters polled by the Financial Times and the Peter G Peterson Foundation saying they believe the president’s policies have helped the US economy.

About 51 per cent of Americans believe Mr Trump’s policies have either “strongly” or “somewhat” helped the economy, the first time a majority of respondents signalled their support for the president’s economic agenda since the FT and the Peterson Foundation began surveying American voters’ attitudes in October. 

The response represents a sharp increase over the previous month’s FT-Peterson Economic Monitor, which showed just 44 per cent of likely voters believed Mr Trump’s policies ad helped the economy, while 47 per cent said they had hurt economic growth.

The poll showed voters sharply divided by party lines, with just 19 per cent of Democrats saying the president’s policies had helped the economy, compared with 89 per cent of Republicans. But in a boost for Mr Trump, 43 per cent of independents said the president’s policies had helped, compared with 33 per cent who said they had hurt; the remaining 24 per cent said they had no impact.

Michelle Meyer, head of US economics at Bank of America Merrill Lynch Global Research, said a combination of low interest rates, housing market improvements and the year-end “high note” for the stock market were all likely factors in voters’ optimism. 

small-multiple line charts of the change in Democrat and Republican respondents' opinion of Trump's policies' effect on the economy, showing a rise in the proportion of respondents saying Trump's policies have helped the economy

The S&P 500, the Wall Street benchmark, rose 8.5 per cent in the final three months of 2019, its best fourth quarter in six years. Unemployment remained at historic lows at the end of last year, helping to drive up wages for all workers, particularly those in blue-collar sectors such as retail, hotels and restaurants.

Julie Hootkin, a partner at Global Strategy Group, the Democratic polling firm that conducted the FT-Peterson poll alongside the Republican group North Star Opinion Research, said consumer spending around the holidays may have also boosted voter sentiment.

“Improved perceptions of the economy around the holidays go hand-in-hand with this year’s higher consumer spending,” said Ms Hootkin. “And more people than ever travelled during the holidays this year, another indicator of economic optimism.”

The FT-Peterson poll showed that support for Mr Trump’s economic policies was less strong in some of the swing states that were key to his 2016 election victory. In Wisconsin, which Mr Trump won by just 23,000 votes, only 39 per cent of likely voters backed the president’s policies; in Pennsylvania and Michigan, 46 per cent believed his agenda had helped the economy. 

Still, the data provide an important bright spot for a president who has staked his re-election bid on a strong US economy. Mr Trump has frequently touted stock market records and strong employment figures on Twitter and at political rallies.

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The poll also indicated that some of the economic optimism may be tied to the recent truce in the US-China trade war, with more than three-quarters of Americans saying they believed trade tensions were having a “very strong” or “somewhat strong” impact on the US economy.

Mr Trump was able to claim trade victories last month after Washington and Beijing reached agreement on a “phase one” trade deal, and a revamped North American trade pact passing the Democrat-controlled House of Representatives.

The poll showed that 46 per cent of Americans felt that the US should not resort to tariffs in trade disputes with its largest trading partners, and another 31 per cent believed that while tariffs may have been appropriate for China, the trade war with Beijing had gone on long enough. Only 23 per cent felt that the US should continue its hard line with China regardless of economic consequences.

While a vast majority of Americans thought the trade disputes had hit the US economy, far fewer said they felt the repercussions personally. Only 43 per cent said trade wars had affected their personal finances, while 52 per cent said they had hit their local community’s economy. 

line chart of us public opinion on changes to personal finance, showing a large gap between Democrat and Republican respondents on whether they are better off than in 2016

Despite the changing sentiment towards Mr Trump’s policies, the FT-Peterson poll continued to show that most Americans do not feel better off financially than when Mr Trump took office. Almost two-thirds of likely voters said they were not better off, despite the continued strong economic growth of the past three years.

Only 37 per cent said they were better off financially than when Mr Trump became president, about the same levels as October’s initial poll. 

The monthly FT-Peterson US Economic Monitor tracks voter sentiment towards the US economy ahead of the presidential election in November. The poll seeks to follow whether likely voters feel better or worse off since Mr Trump became president. Ronald Reagan defeated Jimmy Carter in 1980 by asking voters: “Are you better off than you were four years ago?”

The most recent FT-Peterson Poll was conducted between December 16 and December 22 2019. It reflects the opinions of 1,003 likely voters nationwide, and has a margin of error of plus or minus 3 percentage points. 

The Peterson Foundation is a non-partisan, non-profit organisation focused on America’s fiscal challenges.

Additional reporting by Brendan Greeley in Washington

Copyright The Financial Times Limited 2023. All rights reserved.
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