I could hardly believe it when I saw this poll come out.
It's a testament to effective public relations that a majority of people believe that they will be better off next summer than they are right now. If perception was all that mattered then the mission of fixing the economy has already been accomplished.
Unfortunately for all of us, actual facts mean more than managing perception. Just ask Baghdad Bob.
With that in mind, let's look at those pesky inconvenient facts.
The often quoted statistic is that 70% of America's economy is consumer spending. That, in and of itself, is disturbing for reasons I will go into later on.
In the meantime, let's look at what the consumer has been up to recently.
That's not looking very rosy to me, and it's filtering directly into manufacturing.
No matter how positive the attitude of The Great American Consumer (TGAC), it doesn't make a bit of difference unless he/she has an income. So let's look at the job situation.
Without good jobs and higher income, the Great American Consumer simply can't step up and live beyond his/her means anymore. Almost every nation in the world is waiting for TGAC to restart buying things they don't need with money they don't have.
The reason that isn't going to happen is that the Great American Consumer no longer has an asset to borrow against.
TGAC has already leveraged themselves to the hilt. He/she has nowhere else to turn, and is thus forced to save money and pay down existing debt.
Even when TGAC mortgage's have been modified, they are more than likely doomed.
So what must happen for TGAC to begin spending again? Two things must change, neither problem has even been addressed so far.
The banking system must cut down on its overhanging debt. But to do that it must write off its bad debts. The government has allowed the banks to change its accounting in order to hide the bad debts, thus the banks are zombies - sucking up capital while not loaning it out. Those zombie banks live off of the healthy parts of the economy, weakening it.
In an economy that was an actual capitalist, free market system, those zombie banks would have been allowed to fail. We don't have that.
The other part of the economy that must change is this:
Notice how no nation on Earth, except maybe the UK, devotes as little to savings and investment as America (and the UK may be in even more trouble than we are).
It's the sign of an unhealthy economic system. We shouldn't be depending on other nations, like China, to do our savings and investing for us.
Both the zombie bank problem, and the lack of savings and investment, are normally cured by a deep recession. However, the bailouts, deficit spending, accounting rules, and government stimulus, are all designed to prevent those those healthy corrections from happening.
So why should anyone expect the economy to be better next year?