'People are scared to death,' said Alan Heaton, a mechanic in his fifties, as he sat in the porch of his house in Hamilton Township, a suburb of Trenton, the New Jersey capital. 'Paying mortgages of dollars 1,800 ( pounds 1,000) a month, they can't afford to be sick for a day. A lot have two jobs and can't afford to lose either of them.'
For the first time since 1964, New Jersey is likely to vote against a Republican president. It is a critical defection because the white suburban voters of this mid- Atlantic state, sandwiched between New York and Philadelphia, were a key part of the coalition that brought the Republicans victory in five of the past six presidential elections.
According to Jack Rafferty, Republican mayor of Hamilton (population 89,000), the township will vote for Bill Clinton. 'Whatever he (Bush) says about Clinton in Russia or Vietnam, it is all secondary to the economy,' he said.
Hamilton is less badly off than the rest of New Jersey because many people work for the state government. But last week 1,500 government employees were laid off because there was no money to pay them.
The township's blue-collar and lower-middle-class householders had their expectations raised during the Reagan boom. Five years ago, McDonald's had trouble getting people to flip hamburgers at dollars 8 an hour, six-bedroom houses were being built and there was heavy investment in new office buildings. But the recession began earlier and went deeper in New Jersey than elsewhere.
Hanging from a bridge across the Delaware River, which separates the New Jersey capital from Pennsylvania, there is a sign which reads: 'Trenton makes, the world takes.'
Not any more it doesn't. The USX steel plant is largely idle and General Motors is expected to close a plant that makes door and window handles for cars. Some 235,000 manufacturing jobs have gone in the last decade. The city itself has a desolate air as the department stores close or move to the suburbs. Despite the presence of the governor and the legislature, there is no hotel (all the state legislators commute). 'Even the Holiday Inn went out of business,' a cab driver said.
Herb Klein, a Democrat running for a northern New Jersey congressional seat, says earnings are down 30 per cent in restaurants, and car sales are flat. In Paterson, an industrial city in his district where Samuel Colt made the first revolvers in 1837, unemployment is 15 per cent, and among young black and Hispanic men it is 60 per cent.
New Jersey's cities were always Democratic bastions, but were usually outvoted by the suburbs. Now, says Harold Hodes, a political consultant in Trenton, if you go to a school in a middle-class neighbourhood, 'you see fathers picking up their children in the afternoon - which means they are out of work'. He doesn't believe that George Bush's attacks over Mr Clinton's draft record and trip to Moscow will cut any ice. 'This year people are worried about three things: the future of their children, jobs and welfare.'
A further consequence of the economic failures of the past two years is that big business support for the Republicans is reduced. The Clinton campaign has raised dollars 4m in New Jersey compared to dollars 2m by Mr Bush. A week ago a dollars 1,500-a-plate fund-raising dinner for Mr Clinton was attended by 2,500 people. And just before the dinner Fin Casperson, formerly chief fund-raiser for Governor Thomas Kean and other senior Republican politicians, gave a small party at which a dozen businessmen each paid dollars 50,000 for the pleasure of meeting Mr Clinton.
The only real weapon Mr Bush has to combat these inroads on his support is to say that Mr Clinton will raise taxes. In New Jersey, this will be a potent weapon since state politics are still riven by the decision in 1990 of the freshly elected Democratic governor, Jim Florio, to raise taxes to meet a deficit. His popularity fell to 14 per cent and the Republicans won big enough majorities in the legislature to override his veto. Republican commercials say Mr Clinton will do to the country what Florio did to the state.
Every politician in New Jersey repeats that this year all anybody cares about is the economy. They do so in part because the economy really is flat, but also because they are influenced by the ceaseless repetition by pundits in newspapers and on television of the nostrum that in 1992 only the economy matters. This means Mr Bush is paying a much higher political price for the current recession than his advisers expected. They were also slow to realise that, in reaction to the feel-good optimism of the Reagan years, the public is very receptive to the idea that things are bad and about to get worse.