Are you wearing red-colored glasses? Partisanship can affect views of the economy.

Even in states where jobless rates are falling, Republicans are more likely to say things are getting worse.

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Can partisan negativity on the direction of the economy become a self-fulfilling prophecy? Is partisanship a drag on the recovery?
In the five years since the end of the Great Recession, the U.S. economy has consistently been improving – the stock market is up, the unemployment rate is at the lowest level since the recession, and the economy added more than 300,000 jobs in November 2014, far more than expected.

But despite all this good news, our latest national poll finds that barely a quarter of Americans (27 percent) think the economy has gotten better over the past six months. This is only four points higher than the percentage of Americans who think the economy has gotten worse (23 percent).

So why is it that more than seven in ten Americans say they see no change in the economy, or believe that things are getting worse, when all economic indicators point to the opposite?

Our research points to one answer: Partisanship.

In particular, whether you’re “red” or “blue” may have an adverse effect on how you view the economy. In fact, our research shows that party affiliation is the most reliable indicator of how an individual perceives the state of the economy – regardless of the actual economic conditions where that person may live.

Knowing that states are recovering differently from the recession, we categorized states into three different groups based upon whether the unemployment rate was rising, falling, or staying the same. While the jobless rate is not a perfect measure of each state’s economy, it’s still a good indicator of overall economic trends.

Using this breakdown, there are 19 states (including the District of Columbia) where the unemployment rate improved from May to October 2014, 22 states where joblessness rates have barely changed, and 10 states that have seen their unemployment rate rise over the past six months.

The first surprising finding is that people’s views on the state of the economy are barely different from group to group.

Americans in states where the unemployment rate is improving are only two points more likely to say that the economy has gotten better than those in states where unemployment is getting worse (28 percent versus 26 percent). In fact, in states where unemployment is increasing, only 19 percent say that the economy is getting worse, compared to 24 percent of Americans in states where unemployment is improving or staying the same (24 percent). Even when states are split into just two groups – states where the unemployment rate has fallen or stayed the same versus states where it has risen – there is only a one point difference between Americans’ views of the economy.

Since more localized economic situations don’t explain why Americans aren’t seeing the economy is improving, what is driving these numbers? Of all the demographic and geographic breaks we examined, the one variable that appears to be driving the way people answer this question in polling is partisanship.

In fact, there is a 30-point gap between the percentage of self-described Democrats who think that the economy has gotten better (42 percent) compared to Republicans (12 percent), with Independents somewhere in between (20 percent). The opposite is true among those who think that the economy has gotten worse – 37 percent of Republicans versus just 11 percent of Democrats. However, there is only a four point difference between Democrats and Republicans who think that the economy has stayed about the same over the past six months (45 percent versus 49 percent, respectively).

Further illustrating the point, there is no difference in the negativity of Republicans who live in states where the unemployment rate has fallen or stayed the same and that of Republicans in states where unemployment has increased. And the same is true for Democrats’ positivity.

The bottom line: Regardless of where they live and what economic conditions are actually like in their state, Republicans are consistently more likely to believe the economy is getting worse, while Democrats are consistently more likely to see things getting better.

Why does this matter?

For one thing, we know partisanship affects responses to a variety of questions, such as how respondents feel about the direction of the country. For example, a majority of Republicans said the country was heading in the right direction when George W. Bush was in the White House, and then a majority said the opposite once Barack Obama took over (the opposite was true for Democrats).

But what we don’t know is whether these views are just what people say in polls to make the president look bad (or good) or if these stated views actually affect behavior. For example, if people truly believe that the economy is not improving, does it affect their spending habits? Can partisan negativity on the direction of the economy become a self-fulfilling prophecy? Is partisanship a drag on the recovery?

More in-depth research could produce a more complete answer to this question.

But what is clear is the extent to which partisanship and polarization now cloud Americans’ perceptions of what should be objective economic realities. And for strategists in both parties, this raises another question: is it worth the price?

Stefan Hankin is Founder and President of Lincoln Park Strategies, a public opinion research firm based in Washington, D.C.

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