Economy gets traction as election issue - Many voters say rising prices cut into their income.

Economy gets traction as election issue - Statistics indicate times are good, with low unemployment and high productivity. But many voters say rising prices cut into their income.
By Jill Zuckman
Copyright © 2006, Chicago Tribune
Published September 23, 2006

BRISTOL, Pa. -- Richard Vallejo's gift shop lost money for two years in a row before he finally shut it down last Christmas. Now he's trying to sell the building that houses his antique store, which also is losing money as his customers cut back on buying Hummel figurines and other luxury items.

"I keep listening to our president, who keeps saying the economy is good, and I don't know what he's talking about," said Vallejo, 63, alone all day in his quiet shop except for the company of Killer, his miniature pinscher. "I'm further in debt now than I was 10 years ago."

In the collar suburbs of Philadelphia, where statewide elections are won or lost, voters are confronting an economic conundrum. Most statistics say the nation's economy is flourishing, with low unemployment, high productivity and new jobs.

But many people who live here along the Delaware River and elsewhere across the nation say they are struggling to get by. They say their salaries stay the same but the costs of health care, gasoline, heating oil and college tuition go up, taking bigger and bigger bites out of their take-home pay.

"In the early '90s in Pennsylvania, the big deal was losing your job," said Terry Madonna, director of the Keystone Poll at Franklin and Marshall College. "Now the concern is you have your job, you're working a lot harder and you're making less."

With less than seven weeks until Election Day, polls show the economy has begun to draw even with or edge out Iraq as the top issue of concern to voters, prompting some campaigns to shift their emphasis.

"The economy is getting progressively worse and worse and I do believe it's getting to be more and more of an issue," said Patrick Murphy, the Democratic Iraq war veteran challenging Republican Rep. Michael Fitzpatrick to represent this Bucks County district.

Most recently, the Jones New York apparel plant here announced that it was cutting 323 jobs. Statewide, nearly 200,000 manufacturing jobs have disappeared since 2001.


Emphasis on `good news'

Fitzpatrick, however, describes the economy as "a good-news, bad-news story."

"I'm one who's prepared and excited to talk about the economy's good news," said Fitzpatrick, who is completing his first term in Congress. "But even in a strong economy, people's increase in wages is being reduced by the spiraling cost of health care."

Some such costs have lessened in recent weeks as gasoline prices have plunged, although they still are high by comparison with previous years.

According to the Kaiser Family Foundation, a non-partisan research center for health care, health insurance premiums for family coverage have risen 67 percent since 2000.

Neither candidate in the 8th Congressional District race thinks much of the other's approach. Murphy complains that Fitzpatrick's vote for a Central American free-trade bill known as CAFTA will cost the state more jobs. Fitzpatrick accuses Murphy of planning to raise taxes and undermine recent economic gains, a common Republican attack on Democratic challengers around the country.

In Washington, President Bush and Democratic leaders also are sparring over the nation's economic health.

"We've overcome recession, attacks, hurricanes, scandals, and the economy is growing. Four-point-seven unemployment rate. It's been a strong economy," Bush said last week.

House Democratic leader Nancy Pelosi of California, however, called the president's economic policies "woeful."

"The middle class is being squeezed as more Americans are living paycheck to paycheck," said Pelosi, calling for a minimum-wage increase.

Historically, voters have paid close attention to their pocketbooks, and in most cases, personal financial issues have played a key role in elections. But this year, many candidates kicked off their campaigns with a heavy focus on the war in Iraq. In recent weeks, the White House has sought to shift the dialogue to the war on terror.

But according to a recent CNN poll, voters are more concerned about the economy than Iraq. And a new Pew Research Center poll found that voters believe Democrats would do better than Republicans on the economy by a 14-point margin.

"It seems like almost the forgotten issue of this election," said Christopher Borick, an associate professor of political science at Muhlenberg College in Allentown. "What history tells us [is] it's often the great determining factor in elections' outcomes. It's one of the driving forces in how people turn out on Election Day."

In 1992, for example, the Clinton campaign hit voters over and over with its mantra, "It's the economy, stupid." Even though economic indicators were showing an improvement in the economy's performance, voters still felt beleaguered and held President George H.W. Bush accountable.

"Politically, it's a failure not to be in touch with people's feelings," said Sal Russo, a Republican strategist and former adviser to President Ronald Reagan. "The first President Bush kept saying the economy was doing well and people felt he was disconnected."

Nevertheless, in Pennsylvania's Senate race, Republican incumbent Rick Santorum is touting gains in the state's economy, with 124,800 new jobs created since January 2003. It's a statistic also cited by the Democratic governor, Ed Rendell, as he seeks re-election.

Santorum's Democratic challenger, Bob Casey, on the other hand, talks about the poor economy hurting Pennsylvania's middle class in almost every television commercial he airs as he calls for Congress to balance the budget, eliminate tax cuts for multimillionaires and modify trade agreements to keep jobs in the U.S.

"Bob Casey believes the first step is to turn the economy around," said one ad. Another slaps Santorum for writing that most families could afford to have one parent stay home with their children: "I would like Rick Santorum to come to my house at the end of the month when we're doing our bills and tell me how we can live on one income," said Debbie Balcik, identified as a wife and working mother.

In response, the Santorum campaign denounces Casey as someone who refuses to acknowledge the reality of a robust economy.

"Bob Casey's delusional on the issue of jobs. It's as if he doesn't want to admit that Pennsylvania has increased jobs and the economy is growing," said Virginia Davis, Santorum's spokeswoman. "He's trying to create a dismal picture for his own political gain."


Union sees an opening

The AFL-CIO is trying to take advantage of the economic issues in Pennsylvania and 20 other states, expanding its political program to reach 12.4 million voters with phone calls, neighborhood walks, workplace contacts and e-mails.

In Pennsylvania, union voters and their families who cast ballots in 2004 made up 30 percent of the electorate, a 4-percentage-point increase over the previous election. This year, union officials are hoping for another increase in that percentage to propel their endorsed candidates--Rendell, Casey, Lois Murphy in the 6th Congressional District and Joe Sestak in the 7th--to victory.

Still, voters in Bristol say they haven't decided whom they will vote for, despite restiveness about their economic prospects.

"I think people are afraid to spend money," said Vallejo, owner of The Other Time Antiques. "They're afraid of taxes, of whether they're going to have a job next month and the cost of gas."

Although he's a Democrat, Vallejo has voted for Santorum as well as for Reagan. In 2004, he couldn't bring himself to vote for either the president or the Democratic nominee, Sen. John Kerry of Massachusetts.

This year, he hasn't made up his mind how he will vote.

"I loved Clinton, I loved Reagan and I made lots of money with them," Vallejo said. "It's been terrible ever since."

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jzuckman@tribune.com