Policy

Let's Cut Spending! (Just Not Any of the Spending That Benefits Me.)

|

The Wall Street Journal's Sara Murray does a nice job of laying out the details of a well-known problem: In order to reduce the nation's deficit, we'll almost certainly need to cut entitlements. But an ever-growing percentage of Americans—about 45 percent in 2010—pays no taxes. And the number of people who receive government benefits is growing too. Not surprisingly, then, when you go looking for public support for cutting those entitlements, you don't find much. Voters tend to voice general support for cutting spending, but don't respond well to the idea of cutting benefits that affect them:

He needs you.

Yet even as Americans express concern over the deficit in opinion polls, many oppose benefit cuts, particularly with the economy on an uneven footing. A Wall Street Journal/NBC News poll conducted late last month found 61% of voters were "enthusiastic" or "comfortable" with congressional candidates who support cutting federal spending in general. But 56% expressed the same enthusiasm for candidates who voted to extend unemployment benefits.

As recently as the early 1980s, about 30% of Americans lived in households in which an individual was receiving Social Security, subsidized housing, jobless benefits or other government-provided benefits. By the third quarter of 2008, 44% were, according to the most recent Census Bureau data.

That number has undoubtedly gone up, as the recession has hammered incomes. Some 41.3 million people were on food stamps as of June 2010, for instance, up 45% from June 2008. With unemployment high and federal jobless benefits now available for up to 99 weeks, 9.7 million unemployed workers were receiving checks in late August 2010, more than twice as many as the 4.2 million in August 2008.

And, of course, the new health care law only expands the nation's entitlement infrastructure. Projections from the Congressional Budget Office indicate that, by the end of the decade, about 16 million individuals will receive health insurance subsidies, and another 16 million will enroll in Medicaid, the government's health insurance program for low-income individuals. Now, some portion of those folks already receive government benefits. (Those who end up enrolled in Medicaid are particularly likely to already receive some form of government assistance because they come from the bottom end of the income scale.) But the overall effect will almost certainly still be to add to the number of people who get government benefits.

If there's good news on the entitlement front, it's that voters do seem open to Social Security reform. From a Pew Poll released yesterday:

The latest Pew Research/National Journal Congressional Connection poll, sponsored by SHRM, conducted Sept. 9-12 among 1,001 adults, finds that 58% favor a proposal that would allow workers younger than age 55 to invest a portion of their Social Security taxes in personal retirement accounts that would rise and fall with the markets; 28% oppose this proposal. Majorities across all age groups—except for those ages 65 and older—favor this proposal. Among senior citizens, as many favor (42%) as oppose (42%) allowing private investments in Social Security. By contrast, fully 70% of those younger than age 30 favor this idea.

That's good news. But the bulk of the long-term budget problems stem from the country's commitments to health spending. But Pew reports that just a third of the public favors voucherizing Medicare. And even if there were more public support for general streamlining and downsizing, it would be tough to come up with politically plausible cuts, in large part because the new health care law sectioned off the most obvious potential savings from the program—and, you guessed it, put them toward a new entitlement.