Thursday, 7 April 2011

Converting individual ignorance into collective wisdom

Results from the latest CNN poll on Americans' estimates of US Federal government spending.

If you take the median estimate of the proportion of the budget taken up by each programme, and sum across all programmes, the US spends 137% of its total expenditures. Net interest on the debt is not a listed category.

Here are median public estimates of US government spending along with actual 2010 figures (where easily obtained from Wikipedia).
ProgrammeEstimated proportionActual proportion
Medicare - the federal health program for the elderly20%12.8%
Medicaid - the federal health program for the poor15%8.2%
Social Security20%19.6%
Military spending by the Department of Defense30%18.7%
Aid to foreign countries for international development and humanitarian assistance10%0.8%*
Pensions and benefits for retired government workers10%?**
Food and nutrition assistance for the poor, including the program that used to be known as food stamps10%2.8%*
Housing assistance for the poor7%1.34%
Corporation for Public Broadcasting funding for public television and public radio stations5%.1%***
Federal funding for elementary, secondary and higher education10%1.8%****
*Sourced from 2012 budget proposal as I can't easily find it for 2010
** No clue where to find this one; it'll be mixed in as part of each department's funding
*** Sourced elsewhere; too small a proportion to make it into any of the big figures
**** Includes a bunch of training programs that might not be considered part of these categories, sourced from 2012 proposed budget.

In general, Americans overestimate the proportion of spending on all these parts of the budget.

Let's deflate things by asking how Americans rank programs relative to spending on Medicare. Even if the total amount spent is kinda ridiculous, maybe folks get the rank order and relativities approximately right. In the table below, Medicare is numeraire.


















ProgrammeEstimated size relative to MedicareActual size relative to MedicareRelative inflation or deflation
Medicare - the federal health program for the elderly111
Medicaid - the federal health program for the poor0.750.641.17
Social Security11.50.65
Military spending by the Department of Defense1.51.51
Aid to foreign countries for international development and humanitarian assistance0.50.068
Food and nutrition assistance for the poor, including the program that used to be known as food stamps0.50.22.3
Housing assistance for the poor0.350.13.4
Corporation for Public Broadcasting funding for public television and public radio stations0.250.00132
Federal funding for elementary, secondary and higher education0.50.143.6
On the big ticket items, they're not far out. Folks correctly guess that military spending is about 150% of Medicare spending, even if they've no clue about the actual proportion of the budget taken up by either.

It's on all the small programmes that folks massively overestimate spending. But, somewhat surprisingly, it's not overestimates of programme spending that seem to drive partisan opposition. Tea Party supporters give roughly the same estimates of foreign aid and public broadcasting spending as do Tea Party opponents: 31% of supporters and 34% of opponents correctly identify public broadcasting as taking up less than one percent of the federal budget. And a lot more Tea Party opponents radically overestimate spending on public broadcasting: 22% of Tea Party opponents think spending on public broadcasting is over 10% of the federal budget; only 9% of Tea Party supporters overestimate things that badly.

It would be awfully interesting to have the raw data to see if individual-level misperceptions of federal spending correlated with desired changes in the budget. But that's unlikely to be the driving force. 37% of Tea Party supporters (to 8% of Tea Party opponents) want public broadcasting funding eliminated entirely; differences in perceived spending on broadcasting were fairly trivial.

More worrying is that there's no support for funding decreases to any of the major spending items. 12% support decreases in Social Security spending - the single largest budget item. 37% supported decreased military spending; 30% want it increased. 14% support decreases in Medicare spending; 24% support decreases in Medicaid spending. Medicare, Medicaid, Social Security and Military spending make up about sixty percent of the budget. It'll be tough to balance the budget on the back of cuts to public broadcasting and foreign aid.

Update: it is especially troubling that there is more support for Medicaid cuts than for Medicare cuts. The former helps poor people. The latter helps old people regardless of income.

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