Commentary

Home Prices, Job Opportunities Add To O.C.ís Sense Of Satisfaction: Despite The Grave Fiscal And Political Circumstances Facing The Nation And The State, Most Orange County Residents Are Upbeat About The Future


By Mark Baldassare, research director, Public Policy Institute of California
This opinion article appeared in the Orange County Register on December 7, 2003

Perceptions of Orange County's quality of life have held up remarkably well over the last two decades. Even today, with the addition of 1 million residents since the first Orange County Annual Survey in 1982, residents still give uniformly high ratings to the basic features of local life, including housing, neighborhoods, schools, roads, parks and public safety. Nine in 10 residents say they're satisfied with the quality of life in the region, surpassing satisfaction levels among Angelenos, Bay Area residents and Californians as a whole.

Despite the grave fiscal and political circumstances facing the nation and the state, most Orange County residents are humming "Happy Days Are Here Again." Why the optimism? From their own back yard to the nation's capital, they like what they see. County residents rate local conditions highly and have confidence in the leadership coming from Sacramento and the White House, according to the 22nd Orange County annual survey conducted by the Public Policy Institute of California in collaboration with UCI. Survey results were released last week.

When asked to rate the state of the county this year, very few residents are critical. Nine in 10 residents say their quality of life is good; only one in 10 think things are going badly. Most express high degrees of satisfaction with their homes and neighborhoods, and say they are happy with local public services - including parks, police, roads and schools.

Moreover, six in 10 residents rate the county's economic conditions as excellent or good. When asked if there is an economic recession, the majority of Orange County residents say "no," and only 7 percent perceive the current economic situation as evidence that a serious business downturn is taking place in the region.

Clearly, a red-hot real estate market and a positive outlook on job opportunities are driving much of this exuberance. Homeowners were once again treated to solid increases in local home prices this year, so it is no surprise that nine in 10 conclude that owning a home in Orange County is an excellent or good investment. And compared to other major metropolitan areas of the state, relatively few Orange County residents believe that finding a job that pays well is a "big problem." Indeed, 44 percent of San Francisco Bay area residents and 38 percent of Los Angeles residents rate finding a decent-paying job as a big problem, compared to only 23 percent of Orange County adults.

Among the most closely watched local economic indicators is the Orange County Consumer Confidence Index that we derive from combined responses to five questions repeated from national surveys conducted by the University of Michigan. The Orange County index shows gains from last year and is outpacing the national index. The main reason for increasing confidence is a brighter outlook about their finances and the U.S. economy as a whole: 53 percent of county residents report that their personal finances have improved in the past year; and 63 percent anticipate good business conditions in the United States for the next 12 months, up 16 points from a year ago.

These positive evaluations of the national economic scene today are one of the most striking features of this year's Orange County survey. Despite a ballooning federal budget deficit and upsetting news about military casualties in Iraq, many more county residents believe that the nation is headed in the right direction than the wrong direction (56 percent to 38 percent). The reason? Local residents' perspectives on national trends are greatly influenced by their political leanings: Three in four Republicans think that the nation is going in the right direction, while two in three Democrats believe that the nation is headed in the wrong direction. Voters outside of the two major parties are evenly split in their evaluation of the nation's overall outlook.

The generally optimistic national outlook is consistent with the strong job performance ratings that President Bush enjoys in Orange County today: Overall approval for the president is at 59 percent, and ratings of his handling of economic issues (55 percent) and terrorism and homeland security issues (60 percent) are also positive. Of course, much will depend on the future course of the economy and national and international events between now and Election Day on Nov. 2, but a continued showing of public support for President Bush in Republican strongholds such as Orange County may once again make California a competitive state in the presidential sweepstakes.

We've explained some reasons for the optimism of county residents when it comes to local and national issues, but why the surprising turnaround in attitudes about the state? Californians have been in a grim mood about the Golden State since the initial months of the electricity crisis in early 2001. However, in the wake of the political changes brought about by the governor's recall earlier this fall, half of Orange County residents now believe that the state is headed in the right direction, and 56 percent expect that California will have good economic times next year.

Similar to perceptions of the national scene, the most striking differences in attitudes about the state today are partisan in nature: Most Republicans believe that the state is headed in the right direction (58 percent) and will see good economic times next year (68 percent), while only four in 10 Democrats share these views. More than anything else, this partisan gulf reflects a difference in opinions on the outcome of the governor's recall.

But despite these partisan differences, a majority of Orange County residents like what they hear thus far from their new governor: 55 percent say they approve of his plans and policies for California while only 25 percent disapprove. Even Democrats and voters outside of the major parties are more likely to say they approve than disapprove of the governor's early performance.

Across party lines and political philosophies, Orange County residents agree on another topic as well: Gov. Arnold Schwarzenegger needs to set his sights on solving the state's budget deficit. However, they are divided over the approach that the governor should take in closing the state's projected budget deficit in the next fiscal year - 39 percent favor a mix of spending cuts and tax increases, 36 percent want mostly spending cuts and 7 percent prefer mostly tax increases. Despite the complexity of the budget proposals from the Republican governor and Democratic-controlled state Legislature, it is interesting that the vast majority of county residents believe there are plain and simple ways out of the current quagmire: Most say government could spend less and provide the same level of services.

As rosy as the outlook is today, history warns us against complacency and quick fixes. A decade ago, local governments in Orange County tried to make up for the cutbacks in state funding by earning high interest rates in the Orange County Investment Pool - a risky strategy that backfired when the county-managed fund collapsed and the county government declared bankruptcy on Dec. 6, 1994. This time, Orange County residents should be wary of promises of easy solutions, and instead use the state's fiscal crisis as an opportunity to determine priorities for local government.

Publications

PPIC Statewide Survey: Special Survey of Orange County, December 2003

PPIC Statewide Survey: Special Survey of Orange County, December 2002

When Government Fails: The Orange County Bankruptcy