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Public agrees on deficit as a problem, but not on solutions

June 15, 2012|By David Lauter

Whichever candidate wins the presidential election in November will face the problem of fixing the country’s built-in federal budget deficit. In doing so, the president and Congress can’t expect much help from the public, according to a new analysis by the Pew Research Center.

“In my years of polling, there has never been an issue such as the deficit on which there has been such a consensus among the public about its importance – and such a lack of agreement about acceptable solutions,” the Pew Center’s director, Andrew Kohut, wrote.

In March, a Pew poll showed that the budget deficit has rapidly risen on the public’s list of national problems, with only the economy and jobs ranking higher.  But the public turns thumbs down on virtually all proposed solutions to the budget problem – generally by large margins. Indeed, on most items, majorities of Americans would like to see the government  spend more, Pew polling shows. The one significant exception -- “aid to the world’s needy” -- makes up a minuscule percentage of federal spending.

Republicans are particularly likely to rank the budget deficit as a top problem, with 84% doing so, compared to 42% five years ago. Among Democrats, two-thirds rank the deficit as a top problem, with independents being just slightly less likely to do so. In both of those groups, concern about the deficit has grown over the past five years, although not as much as concern has grown among Republicans.

The government’s deficit involves two separate problems. One is the impact of the bad economy, which pushes tax revenues down while increasing spending on programs including unemployment insurance, food stamps and Medicaid.

Even if the economy fully recovers, however, the second part of the deficit – the built-in part -- would remain. It results from a simple fact of life – the average age of the U.S. population is going up, meaning that more retirees are eligible for Social Security, Medicare and other benefit programs for the elderly, which currently make up about half of every dollar the federal government spends.

As the cost of those programs rises along with the number of retirees, the country faces a relatively straightforward – but politically, very difficult – choice between cutting Social Security and Medicare benefits and raising taxes.

Republican lawmakers have argued that taxes cannot be raised. The budget proposal by Rep. Paul Ryan, which has been embraced by House Republicans, would change Medicare to a voucher-type program that most experts say would, over time, cut the government’s bill but would shift significant costs to individuals. The Pew polling shows that Americans, by a 58%-35% margin would chose “keeping Social Security and Medicare benefits as they are” over “taking steps to reduce the budget deficit.”

President Obama has argued for combining some benefit cuts with some tax increases, a position that a majority of the public has shared – at least in theory. In a Pew poll in November, almost two-thirds of those surveyed favored a combination of cuts and tax increases, while only 17% favored a strategy of cuts alone.

The only tax increases that the public has favored – an increase in taxes for the wealthiest Americans, which Obama has advocated – would only accomplish part of the job.

Administration economists argue that increasing taxes on those earning more than $250,000, combined with some new restraints on benefit programs would reduce the deficit enough to at least stabilize the federal debt at current levels. Actually bringing down the debt would require much harder decisions than the public in either party has so far been willing to support.



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david.lauter@latimes.com

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