December 18, 2014

Facing Facts Alert 7

Number 7, September 8, 1995


Facing Facts Alert 7

FACING FACTS The Truth about Entitlements and the Budget A Fax Alert from The Concord Coalition FAX ALERT (Number 7, September 8, 1995) PUBLIC REJECTS ENTITLEMENTS STATUS QUO The Senior lobby is circulating polls which, as usual, show the public monolithically opposed to cuts in Social Security and Medicare. These surveys misrepresent the true state of public opinion. Without any mention of why Congress is debating cuts, they ask people whether they favor yanking something away from senior citizens -- then record the knee-jerk "no." They imply that the only choice voters have is between doing nothing and abolishing popular programs. And they lard their questions with language about breaking "deals" and "commitments." Understandably, the public's response to such surveys gives the impression it is deeply wedded to the status quo. Reformers take heart. Many polls, including a recent Concord Coalition survey, show that the public is deeply troubled by the status quo -- and much more receptive to reform than the senior lobby wants you to think.* The share of the public which is "confident" in Social Security and Medicare is sinking like a stone and now stands around one-third in most surveys. Only one out of ten Baby Boomers believe the government will be able to keep its financial promises to their generation. More young adults aged 18-to-24 believe in UFOs than think they will ever collect Social Security. The public understands that fundamental economic and demographic trends are the cause of Social Security's and Medicare's bleak financial outlook. In fact, an amazing 93 percent of the public agrees that the projected decline in the ratio of workers to retirees is a very serious or somewhat serious problem. The public believes that averting a crisis tomorrow requires action on entitlements today. Asked whether "major reform" of Social Security and Medicare "is needed now" or whether it can await future developments, 78 percent of the public say "now." The more the public knows about the relative size of entitlement programs, the more it is willing to cut their projected growth. When respondents to Concord's poll learned the current and projected budget share of Medicare, Social Security, and interest on the national debt, the percentage willing to make cost-saving reforms jumped from roughly one-third to roughly two-thirds. The public becomes even more willing to make cuts when it learns that reforms can be means-tested. According to Concord's poll, 67 percent of the public would support reductions in Social Security benefits to higher-income households; 77 percent would support such reductions in Medicare benefits. Other surveys have found equally impressive support for means-testing. According to a 1994 poll sponsored by the National Taxpayers Union and the Congressional Institute for the Future, 62 percent of the public favors a comprehensive means-test for federal entitlements. According to a 1995 CNN poll, 73 percent of the public believes that Social Security and Medicare benefits should be reduced to households with incomes over $50,000; among those opposed, 49 percent are in favor of reducing benefits to households with incomes over $100,000. These favorable ratings are higher than those the public accords virtually every other approach to entitlement reformufrom hiking retirement ages to cutting COLAs to raising payroll taxes. None of this is to say that the public is not still ambivalent about cutting entitlements. The conventional wisdom about the "third rail" of American politics, however, is outdated. Yes, if asked out of the blue whether they want to shut down large and popular benefit programs for no apparent reason, most Americans will say "no." But the public is not necessarily wed to a "deal" that promises they will collect whatever they're "entitled to" under current lawuno matter what the consequences. Indeed, when the need for gradual yet fundamental reform is explained, and when the reform is perceived to be fair, the public's response is favorable. *All polling data cited below are from recent public opinion surveys sponsored by The Concord Coalition, the National Taxpayers Union and the Congressional Institute for the Future, Merrill Lynch, CNN, and Third Millennium.

FACING FACTS AUTHORS: Neil Howe and Richard Jackson CONCORD COALITION EXECUTIVE DIRECTOR: Martha Phillips

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