Fact-checking Americans on the budget

March 12, 2011

The American public appears to be clamoring for a discussion about the size and scope of the federal government. But how can Washington have a serious debate when most Americans are ignorant of what is in the budget?

Yet another depressing survey was released last week that attests to the failure of most Americans to understand the basics of the federal budget — and why there is a soaring budget deficit. Respected Republican pollsters Ed Goeas and Nicholas Thompson reported that 63 percent of those surveyed believe the federal government spends more on defense and foreign aid than it does on Medicare and Social Security. (That’s wrong.)

This survey is broadly reflected by other polls, recently collected by analyst Bruce Bartlett. For instance, a Nov. 30 poll by WorldPublic­Opinion.org found that, when people were asked what percentage of the federal budget goes to foreign aid, the average response was 27 percent. (The real number is about 1 percent.) The estimates were essentially the same for Democrats, Republicans and independents.

The Facts

Imagine a pie, representing the federal budget. Insurance — i.e. Social Security, Medicare, Medicaid — makes up almost half of the pie. A quarter of it is for the military. Spending on domestic programs is one-eighth. Interest on the debt is less than a tenth.

The sliver of the pie for foreign aid would barely feed a mouse. While it’s about 1 percent of the overall budget, it amounts to less than 3 percent of the dollars allocated year after year by Congress, known as the discretionary budget. Perhaps some people lump together foreign aid with military spending, since a lot of military dollars go to wars overseas. Certainly the military is a big part of the budget, but that is not foreign aid.

In fact, compared with other wealthy countries, the United States is an absolute miser on foreign aid. The best way to compare budgets is by looking at how much is spent as a percentage of the country’s overall economy, or gross domestic product. A 2008 list shows the United States as last among 22 countries, with 0.19 percent of GDP. The United Nations has set a target contribution rate of 0.7 percent, and the average country contribution was 0.45 percent.

To some extent, politicians are to blame for some of the public confusion. The debate in recent weeks has focused on cuts in the discretionary part of the budget — which is only about one-third of the government’s $3.7 trillion budget — and the tiny sliver of spending on foreign aid was a big part of that debate. For his part, President Obama, in his 2012 budget, highlighted cuts to relatively minor programs and avoided making proposals for reining in the cost of the big-ticket spending programs, such as Social Security, Medicare and Medicaid.

A recent study by the University of Maryland found that when people were actually given the facts about the budget, they could seriously understand and make choices about how to deal with the deficit. In fact, the results upended some of the usual media stereotypes, with Democrats willing to cut spending more than Republicans — and members of both parties agreeing to raise taxes.

The Pinocchio Test

No matter what rhetoric politicians use about the budget, people need to find out the facts in order to understand the costs, the trade-offs and the challenges ahead. Every year, when the president releases his budget, newspapers print pie charts showing how the money is spent. The budget is publicly available on the Web. There should be little excuse for not knowing the basic facts about how the U.S. government spends taxpayers’ money.

Alas, four Pinocchios to the American public.

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