Government Spending

Americans Are Open to Reforming Social Security and Medicare

Just don't take their savings

|

According to a recent Reason-Rupe poll, a majority of Americans favor reforming Social Security (61 percent) and Medicare (59 percent) if they are guaranteed to get back what they originally contributed into the system. This reveals important information about how the public conceptualizes entitlements in general and what policymakers must consider in order to reform the system. Moreover, a majority of people would also favor allowing workers to opt out of Social Security (54 percent) and Medicare (56 percent).

These results conflict significantly with the findings of other polls. The following will explain why.

Media poll after poll after poll, as well as left-leaning polls and right-leaning polls, have clearly demonstrated that the public does not want to cut spending for two of the largest federal programs: Social Security and Medicare. The media and political class have understandably come to theconclusion that, "It has become a maxim of U.S. politics that Americans approve of cutting spending in concept but disapprove of cutting specific programs." The Associated Press explains its AP-GfK poll results by arguing that "most Americans say they don't believe Medicare has to be cut to balance the federal budget, and ditto for Social Security." If one were to digest all of the commentary and polling data, one would likely conclude that not cutting Social Security or Medicare is one of the few things that most Americans agree on.

Moreover, as Fox Business Channel host John Stossel pointed out recently on his show, even among Tea Party supporters, 62 percent believe entitlements are worth the costs, compared to 33 percent of those who said entitlements are not worth it. This suggests hypocrisy among the movement that is most vocal about reducing the size of government.

Recent results from the Reason-Rupe poll dig deeper into American attitudes to reveal why these aforementioned survey questions do not get at how Americans actually conceptualize these programs. In fact, our results show that a majority of Americans are open to entitlement reform.

We started by asking the standard questions asked in the aforementioned polls:

"Would you be willing to have your current or future Social Security benefits reduced as part of a plan to balance the federal budget or ensure the Social Security program remains in place for future retirees?"

Not surprisingly, a similar proportion (57 percent) oppose.

"Would you be willing to have your current or future Medicare benefits reduced as part of a plan to balance the federal budget or ensure Medicare remains in place for future retirees?"

Again, not surprisingly, a similar proportion (51 percent) oppose.

However, we next asked if respondents would favor reductions in their Social Security and Medicare benefits if they were still guaranteed to receive at least the amount of money that they have contributed into the system. (Please review Methodology Detail below)

Interestingly our results flipped, with 61 percent and 59 percent, respectively, agreeing.

Social Security

Would you be willing to have your current or future Social Security benefits reduced as part of a plan to balance the federal budget or ensure the Social Security program remains in place for future retirees?/or if you were still guaranteed to receive at least the amount of money that you have contributed into the system?

Medicare

Would you be willing to have your current or future Medicare benefits reduced as part of a plan to balance the federal budget or ensure Medicare remains in place for future retirees?/ or if you were  still guaranteed to receive at least the amount of money that you have contributed into the system?

Entitlements have two components. The first is a "savings account" component such that individuals contribute money to Social Security and Medicare from their paychecks. Second, entitlements include a redistributive element whereby money from those with higher lifetime earnings is redistributed to those with lower lifetime earnings. These two components muddled together might help explain why both Republicans and Democrats generally favor these programs. According to Gallup data, support for the programs is virtually identical.

Source: Gallup

However, most poll questions that ask about reducing entitlement spending do not distinguish between these two components of the program. Moreover, it is not obvious that just because a person favors a Social Security savings account that they also favor having their income redistributed. The Reason-Rupe poll's findings suggest that when these two components are disentangled, Americans care most about getting back the money they contributed to the system. They would even be willing to cut additional benefits they may have received, as long as they get what they earned and contributed. This shows that support for entitlement programs like Social Security and Medicare is largely driven by the "contributive" component rather than the redistributive component.

Understanding how the two separate components drive support for Social Security and Medicare makes it clear why Americans have appeared so intransigently averse to reform. It does not make sense to most people why government would need to cut Social Security and Medicare after they have already contributed so much of their own money towards the programs. If they had known that the government would renege on its contract, they could have simply put their money in a risk-free low-return savings account, where at least their principal would remain the same.

These findings also undermine the idea that limited government advocates who are adverse to cutting Social Security and Medicare spending are hypocrites. It is not necessarily the case that these individuals want to cut government spending for everyone but themselves; instead, they simply want to recoup the money that they have already contributed to the system. They just want their money back.

Find full results here.

Methodology Detail:

For Social Security

The survey first asked respondents: "Would you be willing to have your current or future Social Security benefits reduced as part of a plan to balance the federal budget or ensure the Social Security program remains in place for future retirees?"

Yes 37
No 57
Don't Know 6
Total 100

Then among those who answered "No" we asked: "Would you be more willing to accept reductions in your current or future Social Security benefits if you were still guaranteed to receive at least the amount of money that you have contributed into the system?"

Yes 43
No 53
Don't Know 4
Total 100

Then we combined those who answered, "Yes" to the first question and those who answered, "Yes" to the second question. This totals the percentage of Americans who would accept reductions in their Social Security benefits as part of a plan to balance the federal budget and/or if they were still guaranteed to receive at least the amount of money that they have already contributed into the system.

Yes 61
No 30
Don't Know 9
Total 100

For Medicare

The survey first asked respondents: "Would you be willing to have your current or future Medicare benefits reduced as part of a plan to balance the federal budget or ensure Medicare remains in place for future retirees?" 

Yes 43
No 51
Don't Know 6
Total 100

Then among those who answered "No" we asked: "Would you be more willing to accept a reduction in your current or future Medicare benefits if you were still guaranteed to receive at least the amount you have contributed into the system?"


Yes 32
No 66
Don't Know 2
Total 100

Then we combined those who answered, "Yes" to the first question and those who answered, "Yes" to the second question. This totals the percentage of Americans who would accept reductions in their Medicare benefits as part of a plan to balance the federal budget and/or if they were still guaranteed to receive at least the amount of money that they have already contributed into the system.

Yes 59
No 33
Don't Know 8
Total 100

Click here for full survey results.

Survey Methods

The Reason-Rupe Q3 2011 poll collected a nationally representative sample of 1200 respondents, aged 18 and older from all 50 states and the District of Columbia using live telephone interviews from August 9th-18th 2011. The margin of sampling error for this poll is ± 3 percent. The margin of error for the GOP presidential race numbers is ± 4.79%. Interviews were conducted with respondents using both landline (790) and mobile phones (410). Landline respondents were randomly selected within households based on the adult who had the most recent birthday. Sample was weighted by gender, age, ethnicity, and Census region, based on the most recent US Census data. The sampling frame included landline and mobile phone numbers generated using Random Digit Dialing (RDD) methods and randomly selected numbers from a directory-listed sample. Clickhere for full methodological details. NSON Opinion Strategy conducted the poll's fieldwork. View full methodology.

NEXT: Americans Are Open to Reforming Social Security and Medicare

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

Please to post comments

5 responses to “Americans Are Open to Reforming Social Security and Medicare

  1. Therein lies the rub – IF. If it can be guaranteed they can get back everything they put into it.

    That money is GONE. In the old words of my econ profs, sunk costs are sunk. You have to choose the path that gives you the best outcome from where you are right now.
    Or, as I like to tell me son , it’s like golf. You have to play the ball where it lies, not where it could have been if you had made better shots or better choices before.

  2. there are other entitlements that could be adddreses as well as medicare. and social security.those who have paid long enough to draw ss earned conserably less money than those in the last 20 years so what they get from ss is barely enough to survive. yet all congressmen and senators receive lifetime free medical insurance for all their families. plus,a substantial retirement even if only serving 2 years service. perhaps one could look a little closer to home, as it were, for places to trim the budget.

  3. A unique discussion merits a comment. I think that you need to write more on this subject, it might not be a taboo issue however normally people are not enough to speak on such topics. to another. Many thanks

  4. there are other entitlements that could be adddreses as well as medicare. and social security.those who have paid long enough to draw ss earned conserably less money than those in the last 20 years so what they get from ss is barely enough to survive. yet all congressmen and senators receive lifetime free medical insurance for all their families. plus,a substantial retirement even if only serving 2 years service. perhaps one could look a little closer to home, as it were, for places to trim the budget.- ?????
    ????? 2017

Comments are closed.