Coping with The Crash

While traders panicked and economists wrung their hands over the stock-market meltdown, the public at large seemed relatively unfazed: 70% of 810 Americans polled for TIME last Thursday by Yankelovich Clancy Shulman* said the market fall had no effect on their family's finances. Behind the general nonchalance, however, the survey found an undercurrent of anxiety: 46% said they were more worried now than before Monday's rout about America's economic future. Among the poll's findings:

What is to be done?

Sixty-one percent of the respondents believed the stock-market crash will hurt all Americans, not just the wealthy. Though most people said they will not change their purchasing habits as a result of the stock-market decline, the number who plan to curtail spending could significantly affect the economy.

Are you likely to cut back your spending for:

Yes No

Vacations 25% 71%

Christmas presents 23% 75%

New clothes 23% 75%

Major items such as

a new car 35% 61%

When asked about remedies for the U.S. budget deficits and trade imbalance, Americans leaned toward protectionism but would not like a tax increase.

As a way to improve the economy, do you favor or oppose:

Favor Oppose

Reducing military spending 47% 43%

Reducing spending

for social programs 35% 56%

Lowering taxes 54% 38%

Raising taxes 22% 72%

Tougher restrictions

on imports 72% 21%

Nevertheless, 50% of those surveyed said a tax hike will be necessary to reduce the federal budget deficit.

The President's performance

When asked, "Who or what is most to blame for the fall in the stock market," just 13% named Ronald Reagan, and 8% cited Congress; 36% blamed "basic problems in the American economy," while 28% said the crash is the fault of "Wall Street speculators." When asked about the federal deficit, 33% blamed Reagan, 47% blamed Congress, and 13% blamed both equally.

In general, 53% approved of the way the President is handling his job, but people are increasingly skeptical about his abilities: only 31% said they have a lot of confidence in Reagan on dealing with the economy (in contrast to 43% in 1985). Just 17% have a lot of confidence in Reagan on reducing the federal budget deficit; on this question, 29% have no confidence in him at all. While Republicans remain generally supportive, 59% of the public said Reagan is a less effective leader now than in the past. Many Americans doubt the President even has a handle on the pressing issues of the day.

Do you feel President Reagan fully understands the problems facing the country today, or are many problems beyond his grasp?

Total Republican Independent Democrat

Fully understands 44% 64% 42% 34%

Beyond his grasp 50% 31% 53% 66%

The effect on 1988

While 41% of those questioned think it would be better to have a Democrat as the next President, 28% want a Republican, and 22% said it makes no difference. Nevertheless, 65% said last week they want a President who will follow different policies from the Reagan Administration's (up from 57% in a TIME survey last August).

But Americans are even more uncertain about who the next President should be. Among the Democrats and those who lean Democratic, Jesse Jackson remained the first choice of 23%, followed by Governor Michael Dukakis (12%), with support for the other four candidates in single digits. A whopping 44% of the Democrats and leaners surveyed had no first choice for President, up from 28% in August; 61% said they were "only somewhat satisfied" or "not satisfied at all" with Democratic candidates, up from 49% in August.

A similar disaffection has occurred among Republicans and independents who lean toward the G.O.P. The result has been a drastic 13-point decline in support for George Bush over the past two months. Dole remained the same, while none of the other four Republicans is over 6%.

Which of these candidates would be your first choice as the Republican candidate for President?

October August

Vice President George Bush 32% 45%

Senator Robert Dole 22% 21%

None/Not sure 30% 10%

FOOTNOTE: *The survey was conducted by telephone on Oct. 22. The potential sampling error is plus or minus 3.5% for the full sample, 5.5% for Democrats and leaners and 6% for Republicans and leaners. "Not sure" responses are not included.