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Independent, objective, nonpartisan research
Press Release · September 20, 2007

California: Doom, Gloom, And What Happened To Our Boom? Mood Sours As Housing Slumps; Leaders Take A Hit

Will Health Care Be This Year’s “Redeeming” Issue For Electeds? 2008 Primary: Giuliani Lead Narrows; Republicans Signal Discontent

SAN FRANCISCO, California, September 20, 2007 — A dark mood is settling over the golden state as pessimism about California’s economic conditions hits its highest point since 2003, according to a survey released today by the Public Policy Institute of California (PPIC) with funding from The James Irvine Foundation. Housing woes and the spectacle of this summer’s budget battle are taking their toll on residents’ economic outlook— and affecting everything from trust in government to approval ratings of state and federal leaders.

A strong majority of residents (59%) expect bad economic times in the coming year—a 10-point increase since June (49%) and a 20-point increase since January (39%). Likely voters are equally negative, with 62 percent expecting bad economic times. And the attitude is pervasive: Majorities across all the state’s regions and income levels say troubled economic times are on the way.

“There has been a significant shift in attitude this year—and it is very likely being driven by bad news about the stock and housing markets,” says PPIC president and CEO Mark Baldassare. “For so many people, the feeling of overall financial well-being is tied to the value of their homes—something that seems increasingly threatened as they see sales slow, prices dip, and foreclosures rise.” Anxieties this personal are bound to spill over into other areas, and the overall mood in the state is closely in step with the economic outlook: Half of Californians (50%) today believe the state is generally headed in the wrong direction—a 13-point jump since January (37%).

News about the economy, and this summer’s very partisan budget clash, are also hurting approval ratings of state leaders. Governor Arnold Schwarzenegger, who has had positive ratings from a majority of residents since January, is now seeing a more lukewarm response: Half (50%) approve of how he’s handling his job—an 8-point drop since January. Approval of how he is handling the state budget has also dropped (40% approve today, 47% approved in January). Notably, however, among likely voters, the governor’s ratings on both overall and fiscal performance have not changed substantially.

As has been the case in recent years, the state legislature earns even lower marks. Today, only 34 percent of all adults and 29 percent of likely voters approve of how the legislature is handling its job, a decline among both since January (all adults 40%, likely voters 37%). Approval of how lawmakers are handling the budget is even lower, with 25 percent of residents and 23 percent of likely voters giving them positive marks. Perhaps even more indicative of their worsening mood is how residents rate their own individual legislators. That’s a number that has generally remained stable—but has now dropped from 47 percent in March to 41 percent among all adults, and from 46 percent to 39 percent among likely voters.

A Matter of Distrust: As Confidence Deteriorates, Residents Support Reform

The falling approval ratings reflect a concomitant drop in trust of state government. A large majority of both residents (69%) and likely voters (75%) say they trust the government to do what is right only some or none of the time. Even worse, only 29 percent trust the government to do what is right most or all of the time, close to the lowest proportion registered by PPIC’s Statewide Survey since October 2003 (27%), when the recall election of then Governor Gray Davis was under way. Likely voters are even more suspicious, with only 25 percent saying they trust the government most or all of the time.

Mistrust may arise from deep-seated feelings that state government is run by a few big interest groups, not for the greater good; 69 percent of residents and 73 percent of likely voters hold this view. And strong majorities across all political parties agree (Democrats 73%, Republicans 70%, independents 70%). Moreover, more than half of all residents and likely voters (53% each) say the state wastes a lot of taxpayer money. “This is not a new sentiment; a majority of Californians have held this view since early 2003,” says Baldassare. “However, we’re in choppy fiscal waters right now, and these attitudes could be more consequential for public officials and policies.”

Such concerns may go a long way toward explaining robust voter support for various legislative reforms. For example, about two-thirds of likely voters (64%) say term limits in California need at least minor changes, and over half (55%) say they would vote yes on the term limits initiative that would reduce time in office from 14 to 12 years and that is headed for the primary ballot in February. Support for the initiative is shared by half of Democrats (50%) and a majority of Republicans (60%) and independents (56%). Although no redistricting measure is officially slated for next year’s ballot, this reform idea enjoys even stronger support among likely voters, with 66 percent saying they favor an independent citizens’ commission drawing legislative district lines, as opposed to the governor and legislature.

Voter support for both term limits and redistricting stems from a desire to put more checks on government—the same reason behind voter opposition to another reform: replacing the two-thirds vote requirement to pass a state budget with a 55 percent majority. While this reform could prevent voter-antagonizing budget standoffs, only 39 percent of likely voters think it is a good idea; 56 percent think it is a bad idea. “At this moment, it’s difficult to imagine voters easing up on the reins when it comes to their elected representatives; government has simply become too suspect in people’s minds,” says Baldassare.

High-Flying Health Care: Strong Awareness, Support for Reform Efforts

What’s a leader to do? One policy area in which state officials may have a chance to earn public approval is health care reform. Topped only by immigration (18%), health care (14%) is now second on Californians’ list of most important issues facing the state. It has even edged out jobs and the economy (13%), rising six points since June. In fact, 69 percent of residents and 72 percent of likely voters think California’s health care system is in need of major changes. “This issue has been highly publicized and is resonating with the public right now,” says Baldassare. “If actual reform happens, it could be a shot in the arm for state leaders.”

And Californians are paying attention: Nearly half of residents (47%) and a majority of likely voters (55%) say they are following news about Sacramento’s efforts to reform health care at least fairly closely. The interest may be due, in part, to recent high-profile advocacy efforts. For example, half of residents (52%) say they have seen or heard of the documentary film “Sicko,” by filmmaker Michael Moore, with 17 percent saying it has made them more likely to think there is a need for health care reform in the United States. Nearly half (46%) also report having seen, heard, or read advertisements about California health care reform over the summer.

But what are Californians actually willing to support? Strong majorities of residents (72%) and likely voters (63%) favor the plan being advocated by Governor Schwarzenegger, which would require all Californians to have health insurance, with costs shared by employers, health care providers, and individuals. The plan being floated by the state legislature, which would require employers to provide insurance to their employees or pay a fee to the state and would cover all children regardless of immigration status, enjoys strong support among all adults (61%) but falls short of a majority among likely voters (47%). While majorities of Democrats (72%) and independents (58%) favor the proposal, a majority of Republicans (68%) oppose it.

Negative Attitudes Color National Scene as Well …

Closely reflecting skepticism about state government, Californians are equally—if not more— mistrustful of federal government. Three-fourths of residents (75%) and 81 percent of likely voters say they trust the federal government to do what’s right only some or none of the time. And these attitudes may be rooted in the pervasive belief that the federal government is run by a few big interests (all adults 71%, likely voters 77%) and not for the benefit of all people. This view is shared by strong majorities of Democrats (79%), independents (78%), and Republicans (65%). Moreover, about two-thirds of residents (65%) and even more likely voters (71%) think the federal government wastes a lot of taxpayer money.

These attitudes may be reflected in Californians’ approval ratings of President Bush. About seven in ten residents and likely voters (69% each) disapprove of the way he is handling his job, similar to ratings by adults nationwide. Among all Californians, the president’s approval ratings have not surpassed 30 percent once this year. There are, however, major partisan divisions: A huge majority (88%) of Democrats and a very strong majority of independents (74%) disapprove of Bush’s job performance, while a majority of Republicans (58%) approve.

Approval of both of California’s Democratic senators is also faltering. Senator Dianne Feinstein’s approval among likely voters is down seven points since March and stands at 52 percent. This mirrors the 7-point drop in support for Senator Barbara Boxer among likely voters (53% in March to 46% today). In fact, disapproval of Congress as a whole has risen significantly across political parties since January (53% to 69%, Republicans; 49% to 64%, independents; 40% to 53%, Democrats).

… And Iraq Is a Key Reason; Heading into ’08, GOP Voters Troubled by Choices

The war in Iraq is dominating the national landscape and continues to distress the vast majority of Californians: Only about one in four adults (24%) and likely voters (26%) say things are going at least somewhat well. Among the different answers respondents could choose on this question, Californians were far more likely to choose “things are not going at all well” than any other response (48% all adults, 46% likely voters).

This attitude extends to the recent surge of troops in Iraq: Only 25 percent of all Californians believe the strategy has made the situation in that country better, while 27 percent believe it has made things worse, and 43 percent don’t think it has had any effect. Consistent with those perspectives, most Californians (68%) and most likely voters (61%) want the United States to set a timetable to withdraw U.S. troops from Iraq in 2008. As with all questions related to Iraq, however, there is a huge partisan divide: Republicans oppose a timetable (63%) and Democrats and independents support one (86% and 64%, respectively).

As for Bush’s approval ratings on Iraq, about 7 in 10 adults (72%) and likely voters (68%) disapprove of his management of the war. At the six-year anniversary of the September 11th attacks, the president’s overall approval has dropped a stunning 52 points, from 79 percent in December 2001 to 27 percent today.

How are things shaping up for leaders who might inherit the Iraq situation? Among the 2008 Democratic primary candidates, Hillary Clinton (41%) continues to enjoy a strong lead over rivals Barack Obama (23%) and John Edwards (14%) with likely voters today. Among Republican contenders, Rudy Giuliani’s hold on the frontrunner spot is less secure at 22 percent and has narrowed with Fred Thompson (16%) entering the race and already running neck and neck with Mitt Romney (16%) and John McCain (15%). Another possible sign of division within the GOP is that, overall, far fewer Republican (55%) than Democratic (76%) likely voters say they are satisfied with their choice of candidates.

More Key Findings

  • Gender matters? — Pages 17, 18, and 22
    Women are more likely than men to approve of the job being done by Senator Feinstein (53% to 45%), Senator Boxer (48% to 41%), and Speaker Nancy Pelosi (48% to 42%); women Democratic likely voters are also more likely to throw their support behind candidate Hillary Clinton (44% to 38%).
  • Disapproval ratings get slightly more personal — Page 18
    Californians’ approval of their own representative in the U.S. House has dropped from a majority in March (55%) to half (50%) today. Likely voters’ support has dropped from 59 percent to 54 percent.
  • Hope does not spring eternal on Iraq — Page 21
    Whatever course of action the U.S. takes in Iraq, most Californians think that establishing a democratic government in that country is not too likely (36%) or not at all likely (30%).

About the Survey

This edition of the PPIC Statewide Survey is the 25th in the Californians and Their Government series and is supported by funding from The James Irvine Foundation. This survey is intended to raise public awareness, inform decisionmakers, and stimulate public discussions about the social, economic, and political trends that influence Californians’ public policy preferences and ballot choices. Findings are based on a telephone survey of 2,003 California adult residents interviewed between September 4 and September 11, 2007. Interviews were conducted in English or Spanish. The sampling error for the total sample is +/- 2%. The sampling error for the 1,045 likely voters is +/- 3%. For more information on methodology, see page 25.

Mark Baldassare is president and CEO of PPIC, where he holds the Arjay and Frances Fearing Miller Chair in Public Policy. He is founder of the PPIC Statewide Survey, which he has directed since 1998.

PPIC is a private nonprofit organization dedicated to improving public policy through objective, nonpartisan research on the economic, social, and political issues affecting Californians. The institute was established in 1994 with an endowment from William R. Hewlett. PPIC does not take or support positions on any ballot measure or on any local, state, or federal legislation, nor does it endorse, support, or oppose any political parties or candidates for public office.