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'Mourning' in America: What must be done about a depressed nation

By Ed Hornick, CNN
Jason Blatt of Knight Capital Americas LP reacts to the down market at the New York Stock Exchange on Monday, August 8.
Jason Blatt of Knight Capital Americas LP reacts to the down market at the New York Stock Exchange on Monday, August 8.
STORY HIGHLIGHTS
  • Americans are depressed when it comes to the economy, polls show
  • President Obama has tried to assure the public that the country will survive
  • But critics and economists point out that it won't get better anytime soon

Washington (CNN) -- As the Broadway musical "Anything Goes" says, "It's always darkest just before they turn on the lights."

Recent polls confirm that the country is desperately looking for those lights amid continuing economic malaise. But positive signs are hard to find.

The evidence: an unemployment rate over 9%, the S&P downgrade of the U.S. bond rating, troop deaths in Afghanistan, soaring government deficits, a ballooning national debt, the dollar getting pummeled overseas, yo-yo gas prices and gridlock in Washington that has stalled virtually everything.

America, it appears, is stuck.

"Since the White House and members of Congress could not get it together, the United States gets downgraded," said Juneous Pettijohn, a CNN iReporter. "Let this serve as a lession! Let go of your EGOS and come together to get us out of this financial mess."

It certainly doesn't help the country's psyche when some economists predict that the U.S. could face a double-dip recession. The Fed appears to have signaled surrender by telling banks it intends to keep interest rates near zero for the next two years.

Read more: Fed keeps money cheap. What else is new?

And Wall Street reminds us every day that investors are anxious. On Monday, the Dow closed down more than 600 points. On Tuesday, it gained most of it back, up 430 points. On Wednesday, it fell more than 500 points at the closing bell.

"The Dow goes up; the Dow goes down. ... It's a self-fulfilling prophecy, really, and the more uptight we get, the more likely we are to not take risks -- that's being bearish, right?" asked iReporter WJ O'Reilly.

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It's hard to find a majority of American voices -- besides those of President Obama and a few optimistic Republicans -- who still think that our best days are ahead.

"I think the country is depressed. ... The mood of the electorate is depressed," said Jennifer Donahue, a political fellow at the Eisenhower Institute at Gettysburg College. "I think it is mourning in America when nothing will change the fact that Americans may be accepting that our fundamental way of living has changed -- that the American lifestyle has change for the foreseeable future."

Poll finds that Obama's approval rating remains steady in mid-40s

Is the light switch going to turn on anytime soon?

"I don't see it as a sort of darkness before the end of the storm," Donahue said. "I think voters are hunkered down, and I think people are watching very closely. ... Voters are scared."

Obama has tried to calm the fears that are dominating kitchen tables across the country.

"No matter what some agency may say, we've always been and always will be a AAA country," he said at the White House on Monday. "For all of the challenges we face, we continue to have the best universities, some of the most productive workers, the most innovative companies, the most adventurous entrepreneurs on Earth."

The president then summoned history, noting that Americans have always come out on top after an economic crisis.

"The American people have been through so much over the last few years, dealing with the worst recession, the biggest financial crisis since the 1930s, and they've done it with grace," he said. "And they're working so hard to raise their families, and all they ask is that we work just as hard, here in this town, to make their lives a little easier. That's not too much to ask."

What if Obama is right about the downgrade?

Is there anything Obama can do to change it around? Donahue suggested that he tell America that it may be years before we bounce back or celebrate even the smallest sign that the economy, and the country, is improving.

Either way, many observers say that it will come down to jobs, jobs and more jobs.

"I think it will take a lot to reassure voters, especially those unemployed, that a small dip in unemployment rates will make a difference. It'd have to go down significantly," Donahue said. "I think it's very difficult for the White House now to come up with a message that can be hopeful and also accurate. There's very little Obama can say that will realistically cause people to be less concerned about what the market is doing."

In recent polling, Americans say they aren't convinced that will happen anytime soon.

I think it's very difficult for the White House now to come up with a message that can be hopeful and also accurate.
--Jennifer Donahue, political analyst

A CNN/ORC International Poll released Monday found that 60% of respondents say that the economy is still in a downturn and getting worse. That's up 24 points from April, when a plurality believed that things had stabilized.

"Since the question was first asked in the spring of 2009, the number of Americans who said the economy was in a downturn had never been higher than 40%," CNN Polling Director Keating Holland said. "The jump in economic pessimism is across the board: A majority of every major demographic and political subgroup thinks the economy is in a downturn and getting worse."

Read more on the poll

Three out of four people questioned now say that things are going badly in the country today, a 15-point increase since May. Just 24% say things are going well, the lowest figure since April 2009.

Compare that to October 1987, when the stock market had its biggest one-day loss in history as measured by percent decline. Holland said that only 4% of voters polled back then thought they were "affected in a major way, and only 23% were affected in a minor way."

That stock market crash happened under President Reagan, a Republican championed by many as saving the economy. And remember that under Reagan, taxes went up -- as did the nation's debt.

It also didn't hurt that Congress was not as contentious as it is today, Donahue said.

"I think people had more faith in governmental institutions during the Reagan era," she said. "There was more of a sense that the government could be potentially trusted."

Perhaps that's due to Reagan's fiscal conservatism and his famous line, "government is not the solution to our problem; government is the problem." Democrats were also willing to sign on to Reagan's defense policies toward the Soviet Union and with his plan to raise taxes.

And then there's Reagan's iconic campaign ad touting "It's morning again in America," in which he sought to reassure the public that the economy was back on track.

Watch Reagan's ad

The ad, part of his 1984 presidential campaign showed Americans hard at work.

"Today, more men and women will go to work than ever before in our country's history," proclaimed ad man Hal Riney, the folksy voice in the commercial. "It's morning again in America, and under the leadership of President Reagan, our country is prouder and stronger and better. Why would we ever want to return to where we were less than four short years ago?"

And that question is something Obama's 2012 presidential campaign opponents will undoubtedly use in their own ads.

The backlash has begun. GOP presidential hopeful Mitt Romney is blasting the president over his handling of the economy.

"I don't think I've seen a more partisan, blame-oriented presidency in my lifetime," Romney told members of the Concord, New Hampshire, Chamber of Commerce on Monday. "Stop the attacking, take responsibility, and lead."

Palin, who's mentioned as a potential contender, said "be wary of the efforts President Obama makes to 'fix' the debt problem. The more he tries to 'fix' things, the worse they get."

Romney, the former governor of Massachusetts and 2008 presidential contender, added that the president is the person who leads the nation and leads the effort in Washington. "And if it's tough working there, welcome to the real world," he said.

But Obama still holds on to his campaign message of hope.

"The reason I am so hopeful about our future, the reason I have faith in these United States of America, is because of the American people," he said. "It's because of their perseverance and their courage and their willingness to shoulder the burdens we face -- together, as one nation."

CNN Deputy Political Director Paul Steinhauser contributed to this report.

 
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