Mitt Romney has enjoyed surprising strength among seniors — perhaps even more surprisingly after adding entitlement-reform crusader Paul Ryan to the ticket. Most assume that the argument over raiding Medicare Advantage now to pay for ObamaCare costs later have resonated much more strongly than Democrats expected, and that’s probably true. Glenn Reynolds argues in a USA Today column that there is more to the story than just Medicare Advantage raiding, and that seniors have an even sharper concern over the economy:
Interest rates on bonds, CDs and money market accounts — staples of the retirement crowd’s portfolio — are at historic lows. (I’m always shocked to see what banks are touting. Really? 0.35% — that is, 35/100 of a percent — on a money market? 0.90% on a CD? Yep.) Stocks are nothing to write home about, still well below their highs of five years ago. As for those real estate investments? Forget about it.
The squeeze is real. Some years ago, when earning say 5% on your money was realistic, a $360,000 portfolio of CDs would produce $18,000 a year in interest — that’s $1500 a month. Couple that with an unexceptional Social Security payment of about the same amount, and that’s $36,000 a year, $3,000 a month. Nothing fancy, but enough to get by.
Now change that 5% to 0.9% and you’re earning $3,240 per year, or about $270 a month. Add that to $1,500 a month in Social Security and you’ve got $1,770 a month to live on; just $21,240 a year. That’s a brutal 41% cut in income. And it is why many senior citizens around the country are being forced to draw down savings to make ends meet.
At the same time, prices are rising, eating away further at that reduced fixed income:
For senior citizens, it’s a double squeeze. While incomes for retirees are going down, costs are going up. Gasoline is now roughly double what it was when President Obama took office and, in many places, it’s back up in the neighborhood of $4 a gallon.
According to the Bureau of Labor Statistics, ground beef recently hit a national average of more than $3 a pound, the first time in history it’s reached that level. (When Obama was inaugurated, it was $2.35). Anyone who has spent time in a grocery store knows that this sort of thing is happening on every aisle — coupled with “shrinkage,” as manufacturers reduce the amount of product in a box while keeping the price the same, a way of hiding price increases from (they hope) inattentive consumers. And it’s going to get worse, according to the Department of Agriculture, when this summer’s drought hits food prices in a few months.
The economics for seniors have become dire indeed. They need improved economic growth stat in order to survive on their retirement plans. Raiding Medicare Advantage makes that worse, as their medical care choices become more restricted and costly, but it’s the core economics that are likely the biggest reason for seniors to support Romney/Ryan.
A new Rasmussen poll today provides evidence for that conclusion. While Romney only edges Obama by four points on the economy, the internals tell a very interesting story:
Voters still trust Mitt Romney more than President Obama when it comes to handling the economy – but just barely. They have more confidence in the president when it comes to national security, and as for taxes, health care and energy policy, the presidential hopefuls are virtually tied, indicative of how close the race remains.
A new Rasmussen Reports national telephone survey finds that 48% of Likely U.S. Voters trust Romney more on the economy, while 44% have more confidence in the president.
Obama has actually gained ground on this measure, coming back from 12 down earlier in the year. But the numbers for seniors and independents are eye-popping. Seniors trust Romney more on the economy by thirty-five points, 65/30, with only 5% undecided. Independents trust Romney more by twelve, 51/39. Middle-aged voters give Romney a 21-point lead, 56/35, while voters under 40 — not the most reliable voting bloc — favor Obama 58/33. Men give Romney the edge by 13 points — while women only favor Obama by three, 47/44.
Seniors give Romney a double-digit advantage on every issue listed in the poll. Independents do the same on health care, but give Romney only a plurality lead on national security, taxes, and energy. Their support for Romney is broad and deep, but most focused on the economy. Expect Romney and Ryan to hit that hard with seniors in the next two months.