1991 Personal Income Slide Revised Upward : Economy: But it still represents the first decline since 1982, and illustrates how a poor economy throws roadblocks at the Bush reelection effort.

The government reported Wednesday that Americans’ income fell about 2% last year when adjusted for inflation--not as much as previously estimated, but more than enough to illustrate how a poor economy hampers President Bush’s reelection bid in key electoral battlegrounds.

It was the first annual decline in inflation-adjusted income since the recession of 1982.

The revised report issued by the Commerce Department shows that per capita personal income rose 2.4% in 1991 to $19,092, about half as much as needed to keep pace with the consumer inflation rate of 4.4%. In April, the department had estimated the rate of income growth before inflation at 2.1%.

Income failed to keep pace with inflation in 44 states. Only three saw their income rise once inflation was taken into account; another three just kept up.

The new numbers underscore the widespread economic anxieties that are bedeviling the Bush campaign and show how the arithmetic of income growth affects key states as the fall campaign heats up.

From California, where average inflation-adjusted incomes fell by 3.1%, to New Jersey, where the gap was 2.4%, Bush is struggling to overcome the repercussions of what many analysts believe to be among the most politically potent of all economic statistics.

Economic stagnation hurts Bush nationwide, but Democratic strategists believe declining real incomes hurt Bush particularly badly in certain key areas. “Any state where income grew less than 2.5%” before adjusting for inflation “gives us a good shot,” said one senior Democratic strategist.

In addition to California, whose 1.3% income growth before adjusting for inflation was lower than the growth in every state but Nevada, the list of states with incomes lagging far behind inflation include such major electoral battlegrounds as Illinois, 1.9%; Florida, 1.9%; Michigan, 2% and Ohio, 2%.

Republicans have won all four of those states in each of the last three presidential elections--in each of the last four in the case of Illinois--but Democrats now think they are ahead in all but Florida and that they can stay competitive even there, in large part because of the sour economy.

One piece of good news for Bush: Arkansas, home state of Democratic presidential nominee Bill Clinton, continues to rank near the bottom in per-capita income--47th in the new rankings. But incomes in Arkansas grew 4.4% in 1991, making the state one of the three to stay even with inflation and ranking it fourth in income growth last year.

Nationally, income per person--which includes wages, investment earnings and government benefit payments--came to $19,092 by the end of last year. But that overall figure masks a wide variation among states. Mississippi ranked as the nation’s poorest state with $13,328, but it kept pace with inflation. Connecticut, the richest with $26,022, fell behind, with an income growth rate of 1.9%. California ranked ninth with a per-capita income of $20,847.

Although some economists think incomes and production will pick up over the next few months, those changes may come too late to help Bush. Past elections indicate that voters’ feelings about the economy lag somewhat behind the actual numbers.

“It takes a while for the statistics to filter through, for people to hear about them in the media and experience them in their own lives,” said Michael S. Lewis-Beck, a University of Iowa political scientist who has studied the impact of the economy on elections. The key period appears to run from sometime late in the year before the election until sometime in the summer of the election year--or in this case roughly November or December of 1991 through June or July of 1992.

That is bad news for Bush, for whom slow income growth has been a burden since he took over the White House. During Bush’s first year in office, 1989, average incomes grew faster than inflation--6.5% income growth versus 4.8% inflation. But in 1990, income growth slowed to 5.3%, just about the same as that year’s inflation. And in 1991, income growth slowed yet again.

Full state-by-state figures for this year will not be available until next spring. National figures for the first six months of 1992 show incomes doing better than in 1991 but still staying only slightly ahead of inflation, with overall inflation-adjusted growth of about 1.6%.

“It’s not a situation like Jimmy Carter faced (in 1980) when the economy was collapsing, but it’s clearly going to cost Bush votes,” said Lewis-Beck.

Trailing Inflation

Here is a state-by-state listing of per capita incomes for 1991. Rate of change is before adjustment for inflation, which was 4.4%. Any state with an increase below that lost ground:

State Income Rank Chg Ala. $15,518 42 4.3 Alaska 21,067 8 1.5 Ariz. 16,579 35 2.6 Ark. 14,629 47 4.4 Calif. 20,847 9 1.3 Colo. 19,358 15 3.2 Conn. 26,022 1 1.9 Del. 20,816 10 1.5 D.C. 24,063 3.0 Fla. 18,992 19 1.9 Ga. 17,436 29 2.4 Hawaii 21,190 7 3.1 Idaho 15,333 44 1.5 Ill. 20,731 11 1.9 Ind. 17,179 32 2.3 Iowa 17,296 30 2.4 Kan. 18,322 21 3.1 Ky. 15,626 39 4.4 La. 15,046 45 5.4 Maine 17,454 28 1.8 Md. 22,189 5 1.7 Mass. 23,003 3 2.1 Mich. 18,655 20 2.0 Minn. 19,125 18 2.3 Miss. 13,328 50 4.9 Mo. 17,928 24 3.5 Mont. 15,675 38 7.0 Neb. 17,718 26 2.9 Nev. 19,783 13 0.5 N.H. 21,760 6 3.6 N.J. 25,666 2 2.0 N.M. 14,644 46 4.2 N.Y. 22,471 4 1.9 N.C. 16,853 34 2.8 N.D. 15,605 40 3.2 Ohio 17,770 25 2.0 Okla. 15,541 41 2.7 Ore. 17,575 27 2.8 Pa. 19,306 16 3.1 R.I. 19,207 17 2.2 S.C. 15,467 43 2.5 S.D. 16,071 37 3.5 Tenn. 16,486 36 3.8 Texas 17,230 31 3.9 Utah 14,625 48 4.2 Vt. 17,997 22 1.9 Va. 20,082 12 1.8 Wash. 19,484 14 4.0 W.Va. 14,301 49 4.4 Wis. 17,939 23 2.7 Wyo. 16,937 33 3.0 U.S. Avg. $19,092 2.4

Source: Commerce Department