May 16, 2011
That bumping sound you may have heard this morning is the U.S. government hitting the debt ceiling: the legal limit for federal borrowing. There’s been a lot of talk about dire consequences if Congress doesn’t settle its differences over the budget, but the fact is, we still have a little more time. The Treasury Department, by using the financial equivalent of what fighter pilots call “violent evasive maneuvers, ” can put off an actual default until August (this Wall Street Journal chart sums up what that means). But eventually, crunch time will arrive.
There are a lot of issues where surveys show leaders and the public holding dramatically different views of the same problem, and this is one of them. Gallup got a lot of attention last week when it reported that Americans oppose raising the limit by a 2-1 margin:
Now compare that with the latest edition of Public Agenda’s of Beltway insiders on the federal budget and national debt, “The Buck Stops Where?” The question is phrased differently from Gallup’s, but we found two-thirds of leaders (executive and legislative staffers, as well as media, nonprofit and interest group executives) say the ceiling should be raised. More than half of “opinion elites,” or politically active citizens in the Washington area, say the same. (See the report for a full definition of the groups).
|Please indicate which of the following two opinions comes close to your view, either if neither is completely right||Leaders||Elites|
|Congress needs to raise the debt ceiling in the next few months; there is a risk of a financial crisis if they do not||67%||56%|
|Congress should not raise the debt ceiling; it’s an opportunity to limit federal spending and control the national debt||29%||44%|
|From The Buck Stops Where?|
There are two points worth considering when you look at these surveys.
In Public Agenda’s research, it’s not uncommon at all for the public to define the problems — and the solutions — very differently from policymakers and experts. Part of that is that experts have, to put it bluntly, expertise. It’s not that they’re any smarter than the public, but they have put in a lot of time thinking about their specialty. The public, on the other hand, has a lot to worry about besides politics, and its not surprising that they’re not as focused on a technical issue like the debt ceiling. Policymakers are extremely aware of what the implications may be in the financial world if the United States were to default on its obligations; the public may not be. Or, as Gallup puts it:
Americans conditioned by so much news coverage of the enormous federal budget deficit may be reacting to the idea of raising the debt ceiling more in the context of a political deficit discussion as opposed to a financial market implications context. Nevertheless, the public’s perceptions are clearly negative, suggesting the debt ceiling vote is a political hurdle lawmakers will need to overcome.
The second point is this: 57 percent of those surveyed by Gallup said they’re following this issue closely, yet more than one-third — 34 percent — said they didn’t know. That’s a huge warning sign on these results. In survey research, any time you get double-digit don’t knows, that means the results should be considered volatile and subject to change.
The American public is still getting up to speed on this issue — something which, in all fairness, has been the sole province of bond traders and budget wonks for years. As Gallup points out, the fact that so many Americans are skeptical of increasing the debt ceiling is a huge challenge for Washington leaders. Yet becaue of the high “don’t knows,” it’s not at all clear where the public will come down on this question — particularly if some of the dire predictions start to come true.
Join the discussion! Your voice is important. You can comment here at OurFiscalFuture.org, on Facebook, and on Twitter. And to learn more about the numbers that set the stage for some of our choices, check out our slideshow, iPhone and Android apps, and Our Fiscal Future’s Visual Budget Tool.
Fiscal Future Daily is produced by Public Agenda for Choosing Our Fiscal Future, in partnership with the National Academy of Public Administration and with support by the John D. and Catherine T. MacArthur Foundation. The editor in chief is Scott Bittle, with contributors Francie Grace, David White, Jen Vento, Hart Hooton and Tom Watson.