Average Americans don’t think like economists
Northwestern University and University of Chicago’s business schools surveyed a group of top economists, as well as the public at large, and found some big differences when it came to economic policy. Some of the questions tested basic economic literary: A full 100 percent of economists agreed that permanently raising the federal tax rate by 1 percent for those in the top income tax bracket would increase federal tax revenue over the next 10 years. By contrast, only 66 percent of the general public agreed that this was the case, with just 50 percent of Republicans concurring and 80 percent of Democrats. The misconception could partly explain why there’s such aversion to tax increases.
But the biggest differences between the two groups was over a highly politicized issue, rather than one that was primarily factual. The survey asked whether the “Buy American” provision of the stimulus — which required the bridges and roads built under the law to use U.S.-made steel and supplies — would have “a significant positive impact on US manufacturing employment.” Just 10 percent of economists surveyed agreed with the statement, as compared to 75 percent of the general public. Such overwhelming public support helps explain why both Republicans and Democrats have pushed for special breaks for manufacturing even when they don’t seem like the best economic policy.
(h/t Real Time Economics)