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Candidates Must Juggle Inconsistent Economic Data


Now, the presidential election is expected to turn on the economy, which means that every bit of economic news takes on political significance. Trouble is, we don't always know what to make of it when we hear that unemployment claims fell again. Sounds good. Or that the trade deficit jumped. Not so good. NPR's Tamara Keith and Scott Horsley will now help us sort that out.

TAMARA KEITH, BYLINE: Whatever story you want to tell about the U.S. economy, you can find some data points to make your case.

SCOTT HORSLEY, BYLINE: Take last week. On Thursday, we heard that first-time claims for unemployment benefits dropped more than they had in nearly a year.

KEITH: But the next day, the government's big jobs report came out and showed just 115,000 jobs added. Economists widely panned that number as a disappointment.

HORSLEY: Though the unemployment rate fell.

KEITH: Only because so many people dropped out of the work force.

HORSLEY: And so it goes, round and round and round.

KEITH: Just spend a little time watching CNBC or Fox Business and you'll get a constant stream of economic indicators: some good, some bad, some inscrutable.


UNIDENTIFIED WOMAN: Small business confidence in April rose to its highest level since February of last year.

UNIDENTIFIED MAN: Durable goods orders have suffered their biggest decline in three years. March orders slipping 4.2%.

UNIDENTIFIED MAN #2: We have the April read on ISM non-manufacturing: 53.5 We were looking for a number around 55.5.

HORSLEY: For the casual observer, it's hard to know what's going on.

KEITH: Nariman Behravesh, chief economist at IHS Global Insight, is what you might call a professional observer.

NARIMAN BEHRAVESH: Given the mixed signals that the economy's giving out right now, you can make the case for the glass is half-full or it's half empty.

HORSLEY: President Obama is in the half-full camp. After last week's disappointing jobs report, he accentuated the positive.

PRESIDENT BARACK OBAMA: Our businesses have now created more than 4.2 million new jobs over the last 26 months. More than one million jobs in the last six months alone.


KEITH: The presumptive Republican presidential nominee focuses on the half of the glass that's still empty. Here's Mitt Romney the same day on Fox News.

MITT ROMNEY: Clearly the American people are wondering why this recovery isn't happening faster, why it's taken years and years for the recovery to occur. And we seem to be slowing down, not speeding up. This is not progress.


Romney's campaign is all about how far it still has to go. Economist Behravesh says both men have a point. The economy is on the mend...

KEITH: But not very quickly. Behravesh likens it to a patient who's suffered a massive stroke.

BEHRAVESH: So we're in this period where we're recovering, there's no question. But it's quite slow and we haven't completely gotten the use of all our limbs, if you will. But the good news is we are recovering.

KEITH: And for all of us living in this economy, it's not just the raw data points that matter, but how the current economy makes us feel.

HORSLEY: Dennis Jacobe is chief economist at Gallup, which constantly polls people about their feelings on the economy. The picture here is mixed too.

DENNIS JACOBE: Our number for confidence is as high as it's been since 2008.

HORSLEY: But even though confidence is up...

KEITH: Jacobe says it's still lousy, even if the recession technically ended in 2009.

JACOBE: Most Americans still feel we're in a recession, so all those things have gotten better. We're still nowhere near where we were in the better days, even going back to 2006 and 2007.

HORSLEY: And people's feelings matter. The more confident consumers and businesses are, the more they'll spend and hire, and the faster the economy will improve.

KEITH: So far, Jacobe says most of the gains in confidence reflect people's hopes for the future, not their feelings about the less than stellar present.

ESTAFANO SANCHEZ: I'm still struggling, living paycheck to paycheck.

KEITH: Estafano Sanchez lives in Florida, which was hard hit by the housing bust, and where unemployment is still worse than the national average.

SANCHEZ: Obviously, whatever they're doing now isn't working. You know, so why keep doing something that isn't working. Why not try to improve on it.

HORSLEY: In Ohio though, where the jobless rate's fallen below the national average, Robert DeVoe is more upbeat,

KEITH: Even though he's been unemployed since the lumberyard where he worked shut down, and he's now homeless.

ROBERT DEVOE: It's a slow road but I do have hope, and I do see things getting better in future.

HORSLEY: People's personal experience shapes their feelings about the economy. Gallup's Jacobe says their politics are a factor too.

JACOBE: Generally what we see is if you're a Democrat and the Democrats are in power, you tend to be a little bit more positive. And if you're a Republican, and not in power, you tend to be a little more negative about whether the policies that are taking place will work.

HORSLEY: While confidence overall is on the rise, Democrats are generally more upbeat than Republicans. The opposite was true when George W. Bush was in office.

KEITH: So in a way, all those economic data points are just ink blots. Start with slow, unsteady growth, add in widely divergent political views and a lot of spin, and voters may just see whatever picture they want to see.

I'm Tamara Keith.

HORSLEY: And I'm Scott Horsley, NPR News.

INSKEEP: It's MORNING EDITION from NPR News. Transcript provided by NPR, Copyright NPR.

Tamara Keith has been a White House correspondent for NPR since 2014 and co-hosts the NPR Politics Podcast, the top political news podcast in America. Keith has chronicled the Trump administration from day one, putting this unorthodox presidency in context for NPR listeners, from early morning tweets to executive orders and investigations. She covered the final two years of the Obama presidency, and during the 2016 presidential campaign she was assigned to cover Hillary Clinton. In 2018, Keith was elected to serve on the board of the White House Correspondents' Association.
Scott Horsley is NPR's Chief Economics Correspondent. He reports on ups and downs in the national economy as well as fault lines between booming and busting communities.