The so-called super committee—formally, the Joint Select Committee on Deficit Reduction—is required to report legislation no later than Nov. 23 that will reduce future budget deficits by no less than $1.2 trillion over the next 10 years. Although granted extraordinary power to propose measures that cut across the jurisdictional lines of various congressional committees, the super committee appears poised for failure. The key stumbling block is, and has been since the beginning, that the American people are not yet willing to suffer any pain to reduce the deficit.
Like so many failed past efforts to deal with our fiscal problems, such as last year’s Simpson-Bowles commission, the idea of the super committee is that our deficit problem is merely technical, that it just requires a few experts to go through the budget and find waste and other painless budget cuts.
It is commonly believed that half of all government spending is wasted. A September Gallup poll found that Americans believe the government wastes 51 cents out of each $1 spent. This view is surprisingly consistent across ideological and political party lines. It’s also consistent worldwide. According to a 2010 BBC poll, people everywhere think that their governments waste an average of 52 per cent of spending.
Obviously, if one believes that half of government spending is wasted then balancing the budget is a piece of cake. Just cut the waste and everyone will be able to continue enjoying the same government benefits they currently receive without paying more taxes and only the undeserving will suffer.
Of course, one person’s waste is another person’s essential government program. When asked, it turns out that people believe the bulk of government spending is, in fact, essential. Indeed, they often say that spending should be increased for particular programs.
- In February, Pew asked people whether spending should be increased or decreased for various programs. People favoured increasing spending over decreasing spending by the following margins (percentages): education (62/11), veterans’ benefits (51/6), health care (41/24), Medicare (40/12), crime fighting (39/18), energy (36/23), scientific research (36/23), environmental protection (36/26), anti-terrorism (33/21), agriculture (32/23), military defence (31/30), unemployment assistance (27/28), and global poverty assistance (21/45).
- An April Economist/YouGov poll found similar results. Here are the increase/decrease ratios (percentages): education (42/20), veterans’ benefits (33/6), Social Security (29/12), health research (29/18), science and technology (28/19), Medicare (26/16), highways (26/15), mass transit (25/30), the environment (24/33), aid to the poor (22/25), Medicaid (22/23), national defence (16/36), unemployment benefits (15/27), housing (14/38), agriculture (12/38), and foreign aid (4/73).
Keep in mind that those that favour neither increasing spending nor reducing spending favour keeping it where it is. Consequently, there is just one program that people really favour cutting and that is foreign aid.
Most experts believe that foreign aid is a critical tool of American foreign policy. If we could no longer use the promise of aid or the threat of cutting aid to exercise influence over other countries we might have no alternative except to use military force, which is far more costly just in terms of dollars, not to mention human lives.
A bigger problem is that people grossly overestimate the amount of federal spending going to foreign aid. A 2010 World Public Opinion poll found that people think 27 per cent of the federal budget is devoted to foreign aid. The true figure is about one half of one per cent. Zeroing out the entire international affairs budget, including that of the State Department, would only save $46 billion in a budget of $3.6 trillion.
The problem of budgetary ignorance is evident in other ways as well. In 2010, Pew asked people which of these programs spend the most money: national defence, education, Medicare, or interest on the debt. Only 29 per cent of people correctly said it was national defence. Interest on the debt was ranked highest by 23 per cent of people even though its cost is less than one-third of what is spent on defence. Medicare was named highest by 15 per cent of people, but its cost is just two-thirds of the defence budget. Education spending constitutes a little over one per cent of federal spending.
In 2011, Pew asked a similar question about which of these programs is biggest: Medicare, education, scientific research, or interest on the debt. Only 29 per cent of people correctly guessed Medicare, with 36 per cent saying it is interest on the debt, which is less than half of what Medicare spends. Spending for scientific research and education is trivial by comparison.
Given these misperceptions, it’s not surprising that people consistently oppose cutting popular programs like Social Security and Medicare or raising taxes to deal with the deficit. They don’t think it’s necessary. Just cut foreign aid, many apparently believe.
What is critically necessary if we are to solve our budget problem is for people to get the correct information about the composition of government spending. Since it is rare for anyone in politics or the media to ever tell them, average people can be forgiven for not knowing basic facts. Unfortunately, their ignorance allows demagogues to lead them down the primrose path of costless and painless cures for deficits.
20 years ago, billionaire Ross Perot captivated the country with charts and graphs showing the true nature of our budget problem and he received a substantial number of votes for president in 1992 and 1996. Why no one is doing the same today is a mystery. I even had to Google Perot’s name just to see if he is still alive. (He is.)
Unfortunately, the media believe that facts are boring and people just want opinions—the more strongly held the better because that makes for better television. And politicians are by nature purveyors of lies and mischaracterizations. But at some point, people need to know the truth.
Sadly, the super committee missed an opportunity to use its mandate to help educate the American people, spending most of its time behind closed doors search for a painless cure for deficit spending that won’t increase anyone’s taxes or cut anyone’s benefits. But the real failure of leadership is President Obama’s. He alone has the power to get the nation’s attention and give them the facts the way Perot once did. But Obama has never done it and now it may be too late to avoid a budgetary train wreck when the super committee inevitably fails in its mission.
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