April 17 (Bloomberg) -- Protectionist and populist sentiments run strong among Democrats in three states holding presidential primaries, showing why the campaigns of candidates Hillary Clinton and Barack Obama are moving in those directions.
A plurality of Democratic primary voters in Pennsylvania, Indiana and North Carolina blames predatory lenders and mortgage- company greed for the housing crisis that may be dragging the U.S. economy into a recession. A majority in each state favors a government bailout of homeowners in danger of foreclosure, according to a Bloomberg/Los Angeles Times poll of likely Democratic voters.
Most Democratic voters in the three states also believe free trade has hurt the economy and favor tougher regulation of Wall Street.
``We've got more stuff coming in from other countries than we've got going out,'' says Louis Bixler, 63, a Logansport, Indiana, Democrat, in a follow-up interview. The retired factory worker blames the loss of trade-related jobs for economic problems including the housing crisis. ``Let's get back to, `Made in the U.S.A.','' he says.
Obama and Clinton, who are competing for the combined 406 delegates in the three states, have bashed free trade, promising to slow new agreements, renegotiate existing ones and punish China, with which the U.S. had a record $256 billion trade deficit last year.
The two candidates also advocate greater supervision of financial markets and have devised plans to assist homeowners in danger of default. Clinton, 60, has called for a moratorium on foreclosures and a five-year freeze on subprime interest rates.
`Failure of Oversight'
``There has been a regular failure of oversight'' of the financial industry, she said on March 18.
``Our free market was never meant to be a free license to take whatever you can get, however you can get it,'' Obama, 46, said in a March 27 address.
The poll of 687 Democratic primary voters in Indiana, 623 in Pennsylvania and 691 in North Carolina was conducted April 10-13, and has a margin of sampling error of plus or minus 4 percentage points. The Pennsylvania primary is April 22; the contests in North Carolina and Indiana take place May 6.
After mortgage lenders, voters in the three states faulted insufficient government regulation, as well as irresponsible borrowers, for the housing crisis.
Blaming the Lenders
``Lenders were looking for ways to make a buck in an era when many Americans were eager to grab a piece of the American dream,'' says Jennifer Simmons, a poll respondent from Raleigh, North Carolina. Asked if she thinks homeowners should be bailed out by the federal government, the 31-year-old lawyer says, ``Yes, I do.''
Democrats in all three states had a negative view of trade, with 58 percent in Indiana, 55 percent in Pennsylvania and 61 percent in North Carolina saying it has hurt the economy. At least three in 10 in each state say it hurt a lot.
In an economic speech this week, Republican candidate John McCain also sounded populist, criticizing business executives for ``extravagant salaries'' and bankers for bad decisions that contributed to the economic slowdown.
Still, McCain called free trade ``indispensable to our future prosperity'' and chided the Democrats for preaching ``economic isolationism.''
Respondents in all three states say, by margins of 2 to 1 or better, that the federal government should regulate the financial industry more aggressively. Sixty-four percent of North Carolina Democrats and 62 percent of those in Pennsylvania support a federal bailout of homeowners caught between rising mortgage payments and falling home values. Slightly more than half of those in Indiana agree.
Freeze Rates
``I don't feel that the government should bail homeowners out, but I do feel that lenders should freeze escalating interest rates, and the government should require them to do it,'' says Renee Webb, a Democrat in Fort Washington, Pennsylvania. Webb, 57, a rental property owner, says banks need more regulation because ``what's happening on Wall Street is infecting the rest of the economy.''
More than six in 10 Democratic voters in each state call their personal finances secure, though at least eight in 10 say the economy is in a recession.
A slight majority of respondents in Indiana and North Carolina say it's easy for them to pay their monthly mortgage or rent, with about a quarter saying they're having difficulty.
Paying the Bills
In Pennsylvania, four in 10 say they're having no trouble making payments and 35 percent say they are. Almost one in 10 voters in each state say paying bills is ``very difficult.''
Similarly, 55 percent of Indiana respondents and 61 percent in North Carolina say paying other monthly bills is easy, while half of Pennsylvania respondents agree. A majority of those in each state say they're not concerned about losing their jobs.
None of the states had an unemployment rate significantly different from the national average of 4.8 percent in February, according to the Labor Department. However, both North Carolina and Pennsylvania saw a jump in jobless rates over the last 12 months.
Poll respondents in all three states were split over whether the government did the right thing by helping Bear Stearns Cos. avoid bankruptcy.
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