In America it’s still ‘the economy, stupid’

Twenty years ago, a man from Hope, Arkansas, became US president on the coat-tails of one phrase that epitomised voters’ frustration with the status quo in America.

“It’s the economy, stupid” catapulted William Jefferson Clinton from the Little Rock Governor’s Mansion to the Oval Office in Washington DC in 1992.

These days, residents of the Democratic 42nd president’s home state still hear echoes of the same axiom, even as the Republican-leaning populace is set to give Mitt Romney six electoral votes.

Many conservative Arkansans express discontent with the current administration’s economic record and are wooed by the GOP’s promises of more jobs, lower taxes and lower national debt.

Meanwhile, supporters of President Barack Obama’s re-election in 2012 say the current transition period of relatively slow post-recession growth will be followed by a restoration of budget health and an era of renewed prosperity.

‘Make that money stretch’

Heather, a criminology instructor for the Arkansas Department of Corrections (ADC), said she would vote Republican in November to help America get back on its feet.

“Due to the budget crunch, I moved back in with my parents,” said the earnest 27-year-old daughter of a librarian. “I’m just trying to make that money stretch, like everyone else with the way the economy is going.”

Heather, whose job is to instruct corrections officers in Pine Bluff, told Al Jazeera the ADC had to shut down one of its prisons and relocate staff but the state still has “one of the best prison systems around”.

She says the bad economy is making criminals more dangerous, and that offenders she encounters are starting off at a lower age.

“And there’s a lot of people that need to be working, instead of us just handing them a check,” she says about many Arkansans receiving government assistance. “I’ve worked for everything I’ve earned.”

“I want the same things all Americans want,” she says. “Something new. And with a better leader, all of our wants would be – maybe not assured – but there’d be a better outcome.”

Anemic Arkansas output

GDP growth last year in the southern state of Arkansas was a mere 0.3 per cent, 39th in the country. Agricultural output, which includes forestry, fishing and hunting, fell by 16 per cent. And the construction sector has been shedding jobs.

While the outlook is decidedly better than when the state was in the depths of recession in 2009, unemployment has remained stubbornly high in areas like Pine Bluff, on the outskirts of Little Rock, the state capital.

A Unilever manufacturing plant in Jonesboro recently announced an investment of $40m and 125 new jobs. And in Osceola, a Beckmann Volcker facility said it would be adding 300 workers building steel components for wind turbines.

But in the same span of time, the Forestry Commission laid off 300 people. Hewlett-Packard announced massive national layoffs that could affect several hundred people in Conway. And Whirlpool is shutting down a refrigerator factory in Fort Smith that employed about 1,000 people, as the company announced it would move the plant south of the border.

The flux in economic fortunes for many states is a common theme in Republican efforts to slam the incumbent’s effectiveness at creating jobs.

In the Vice Presidential debate on Thursday, Rep Paul Ryan said of his opponent’s performance: “Look, did they come in and inherit a tough situation? Absolutely. But we’re going in the wrong direction.”

The Wisconsin Congressman continued: “The economy is barely limping along. It’s growing at 1.3 per cent [nationally]. That’s slower than it grew last year and last year was slower than the year before … Job growth in September was slower than it was in August, and August was slower than it was in July.”

The politician famous for his budget-cutting credentials continued: “Twenty-three million Americans are struggling for work today; 15 per cent of Americans are living in poverty today. This is not what a real recovery looks like.”

‘That’s what built America’

Republicans often say growth hinges on higher incentives for private entrepreneurs to invest in small businesses.

Lee Watson is one serial entrepreneur who praises Obama as the “first president to truly encourage startups” and commends the recent JOBS Act, which paved the way for crowd-funded businesses. But Watson also thinks Romney’s proposal for income tax reduction would be more conducive to reinvesting income.

“In the long run, it’s not the rich guy or the poor guy. We need to celebrate the entrepreneur“ – Lee Watson, business owner

The zealous networker from the small town of Heber Springs in northern Arkansas cites Startup America as a nonpartisan solution to increase economic productivity.

“Someone might be doing something in Fayetteville but because we don’t go up there to see what’s going on, we didn’t know,” he says of the organisation’s ability to connect people. “I hear about one startup launching every month. In a state like Arkansas, I’m pretty happy with that.”

“People working out of their garages or apartments – we plug them in to Walmart or whoever their customer base is. The reason DC or Silicon Valley works is the high density of people with a lot of energy. But not everybody is going to be Mark Zuckerberg,” Watson said of the Facebook founder. 

“Entrepreneurship is a buzzword, but that’s what built America. In the long run, it’s not the rich guy or the poor guy. We need to celebrate the entrepreneur, globally.”

One of the main points of contention in this year’s presidential contest – with increasing partisan rancor about opposing solutions – revolves around the government’s role in sustaining education, fostering growth and aiding the free market.

Arkansas like the ‘Global South’

Ellen Fitzpatrick, an economist at the University of Arkansas, says the Republican economic programme is dangerous at both the state and national level.

“What’s really important in the upcoming election is to have leaders that value education,” the professor told Al Jazeera. “But if Arkansas elects a predominantly Republican legislature, there will be cuts in education, especially higher ed.”

“The Republican ideas are short-term oriented. It’s like cutting off the nose to spite the face“ – Ellen Fitzpatrick, Arkansas professor

“The long term result is a more permanent underclass with no access to [socioeconomic] mobility,” Fitzpatrick says. “This [state] legislature has the lowest level of education of any in the country, so it’s not surprising that they give low value to education.”

Last year, a study by the Chronicle of Higher Education revealed that 25 per cent of the state’s lawmakers have no college experience, compared with just 8.7 per cent nationally.

“We are creating a dual economy, where Little Rock and Fayetteville may be like the Global North, and the rest of Arkansas will be much like you see in the Global South,” she says, before lauding Obama’s Keynesian principles.

“The Republican ideas are short-term oriented. It’s like cutting off the nose to spite the face.”

Fitzpatrick also says the trickle-down economics embraced by Mitt Romney’s running mate and championed during Thursday’s showdown in Kentucky are a proven failure.

“I don’t think Ryan understands these issues at all. He’s too caught up in the ideology of what he’s trying to promote.”

Ryan, who said in 2009 that the “morality of capitalism is under assault”, has made debt reduction a signature item on the Republican ticket’s agenda.

“Our ability to carry a deficit is a wonderful thing,” Fitzpatrick says. “We would have been in a much deeper recession [had we not] borrowed from the future.”

“It’s sort of like student loans to earn a much higher salary later than if you were just flipping burgers at McDonald’s.”

Democrat as a ‘dirty word’

Arkansas is 48th in the country for median household income and consequently had the lowest political donations of any state this election cycle.

Although Arkansas has been a “red state” since Bill Clinton left the presidency, polls show around 35 per cent of voters will vote for Obama in 2012. And in much of the right-leaning state, Democrats hide their political beliefs.

“In Hamburg, Arkansas, ‘Democrat’ is a dirty word,” says Rebecca, a speech therapist who works for the government and did not give her surname. “There are Romney signs all over our neighbourhood, so we don’t usually talk politics.”

The 37-year-old told Al Jazeera that she finally “came out of the closet” as a liberal Democrat on Thursday to her co-workers – following 13 years of political silence – after they laughed at an Obamacare joke she thought was not funny.

She says her views on the economy and taxes also set her far apart from most people in her town of 3,000.

“I work with pre-schoolers. We teach them about sharing – and socialism,” she says, chuckling. “Should everyone pay the same share?”

Follow @BenPiven on the #RedStateRoadTrip through Kansas, Oklahoma, Arkansas and Tennessee.