Who Cares about Budget Deficits?

by John Sides on February 27, 2013 · 17 comments

in Political Economy,Public Events

We welcome another guest post from Brown University political scientist Michael Tesler.

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With Republican deficit hawks digging in on the sequester, liberal politicians and pundits have been quick to point out the GOP’s silence on this issue during George W. Bush’s presidency (e.g. here, here, and here).  Of course, prominent Democrats, including Barack Obama, who used the mounting debt to criticize the previous administration, aren’t exactly a model of consistency on the deficit either.

This sharp reversal in elite partisan discourse about the debt since Obama took office should produce profound shifts in public opinion, especially amongst the most informed Democrats and Republicans.  For, as John Zaller’s groundbreaking account of public opinion demonstrates, the best informed partisans are quickest to update their beliefs in response to elites’ position changes because they are most likely to receive those messages.

Consistent with that expectation, the figure below shows a dramatic shift between 2007 and 2011 in the importance well-informed partisans placed on the federal budget deficit.  The display graphs out the percentage of Democrats and Republicans who thought the federal budget deficit was at least a very important issue in 2007-2008 AP/Yahoo Election Panel Study and the baseline wave of the 2011-2012 Cooperative Campaign Analysis Project (CCAP).  The responses of Democrat and Republicans are broken down by their level of political information, which captures how much attention they pay to politics.  It is important to note that the 2007 and 2011 percentages are not directly comparable because the issue importance response options and political awareness items were different in the two surveys.  Yet the shift is unmistakable nonetheless.


Back in December 2007, politically attentive Democrats were 20 percentage points more likely than politically attentive Republicans to say that the federal budget deficit was at least a very important issue.  Four years later, though, the most politically attentive Republicans were now a whopping 60 points more likely than their Democratic counterparts to say the deficit is very important.

Contrary to some recent media claims that the deficit is an issue average Americans care about, it appears that public perceptions of the debt’s importance are fundamentally linked to which party is making it an issue.  These results are consistent with research showing that Americans’ issue positions are often consequences rather than causes of their vote choices and help explain why increases in the federal budget deficit do not significantly predict vote tallies in national elections.

{ 17 comments }

Scott Monje February 27, 2013 at 11:46 am

Is there any accounting for the fact that the economic situation changed between 2007 and 2011? It may be more “consistent” to say that if you have surgery when you’re sick, then you should have surgery when you’re well, but it doesn’t make a lot of sense.

Rob Mellen February 27, 2013 at 12:03 pm

I have no doubt that some of the drop in Democratic worrying about the deficit between 2007 and 2011 is related to party control of the White House. But as Scott alluded to, is there any way to determine what portion of this might be less partisan based and more philosophically rooted in the changing economy and views on economic intervention? Democrats are generally more supportive of deficits when economic times are bad while Republicans argue that bad times require belt tightening. Just wondering if we account for that what the charts might look like.

Fact Checker February 27, 2013 at 12:21 pm

In 2007 the deficit was $160 Billion
In 2011 the deficit was $1.3 Trillion.

Why do people care – It was 8 times larger.

Information for Republicans seems to be the ability to perform math.
Information for Democrats seems to be told what to do by their social-dominating masters.

http://www.cbo.gov/sites/default/files/cbofiles/attachments/43904-Historical%20Budget%20Data-2.xls

Scott Monje February 27, 2013 at 1:03 pm

Austerity during an economic downturn is counterproductive. Britain has slashed its spending over the past three years only to see its economy stall in a triple-dip recession and its debt-to GDP ratio get worse.

Fact Checker February 28, 2013 at 1:36 am

Scott. You need to find new facts. The UK has had one year of “slashing” – 2013. The amount “slashed” is a whopping 1.5%. Following a previous 4 years where public spending increased by 5% per year. Even with the cut, spending grew at an average of 3.5%/yr – much faster than inflation and population.

Scott Monje February 28, 2013 at 2:22 pm
Bill February 27, 2013 at 2:15 pm

“Fact Checker” is low on facts. The debt would have risen as much or more if Republicans had been in control since 2008:

– revenues would still have plummeted
– spending on the poor and unemployed would have grown automatically
– a permanent tax cut would have been enacted as “stimulus”
– entitlements would have been scaled down for GOP ideological purposes.

Republican voters would have accepted more debt to finance the tax cuts. Democratic voters would have blamed the GOP for passing unaffordable tax cuts in a time of big deficits. As Professor Sides implies, nobody really cares about deficits that pay for their party’s agenda.

Fact Checker February 28, 2013 at 1:45 am

Bill.
Let me get this straight. Since I used hard information, I’m the fool. When you make up numbers, you’re an “expert”. Please give me the referenced source to your claim that Republicans would have increaed the debt as much as Obama. I want proof.

I giggle when you claime that mandatory spending “entitlements” would go up, only to go down. Are you high, or just a complete fool? I don’t blame you – I blame your parents’ inability to instill a desire t0 educate yourself.

$160 B is not a large deficit – in terms of deficit/GDP it is the 5th lowest deficit in the past 50 years. I feel that I need to break out a pack of Crayons to draw you a graph, as these “numbery” concepts probably go right over your head. Look, when you have your Cheerios tomorrow. Count out 50 Cheerios, and put them in a line, replace the 5th Cheerio with a Fruit Loop. That colored cereal represents Bush’s 2007 deficit. Is there a bunch of Cheerios on one side? Those are the years with deficits larger than Bush’s. Those are almost enough to fill your tum-tum.

GiT February 28, 2013 at 11:04 am

Given your alleged aptitude at “performing math,” perhaps you’d like to consider the cost of debt, without which deficit and debt numbers border on meaninglessness.

But then, that would reveal that the cost of debt – interest paid as a % of GDP – is on the low to middling side for the post 1950 period, set to increase to the historically high level typical of the 1980-2000 period (horrible years, I’m sure).

http://www.usgovernmentspending.com/spending_chart_1950_2017USp_13s1li111mcn_90t

But yes, 1.7 trillion is a very big number. Congratulations on your ability to count.

Sander February 27, 2013 at 12:55 pm

Article is true as far as it goes. In 2000 we had a surplus. CBO had reported that all things being the same, we would pay off the national debt 100% within 10 years, alarming some like Alan Greenspan. Bush tax cuts were deliberately designed to maintain and deepen the deficit which Greenspan signed off on. And we got Cheney’s quote, “Reagan proved, deficits don’t matter.” So we paid for 2 wars and other increased spending by borrowing more than ever, so it’s not entirely fair to accuse Democrats of only politics as usual under those circumstances. Suddenly the republicans who did not mind & seemed to welcome deficits became deficit hawks only when the Republican candidate lost in 2008.

BTW, in 2008, before election day the CBO projected the 2009 budget deficit to be over $1 trillion, regardless of who won.

Fact Checker February 28, 2013 at 2:00 am

Sander.

The changes from 2001-2011 are detailed here: http://www.cbo.gov/sites/default/files/cbofiles/attachments/06-07-ChangesSince2001Baseline.pdf
Basically we spent $5.6 T more than we thought, we taxed $2.8 T less than we thought and had a $3.3 T oops (the CBO miscalculated). The technical mis-haps of the 2001 calculations would have certainly made it impossible to have paid off the debt even with no changes.

Also there was an event on 9/11/2001 where some terrorists attacked us. I’m pretty sure we would have went to war regardless of who was president. That cost about $1 T or so.

The CBO predicted a $1T deficit for FY2009. But we ended the FY2009 with a $1.4T deficit – that’s quite a bit more – thanks to Obama’s omnibus, the stimulus, cash for clunkers and many other appropriations signed exclusively by Obama.

Sander February 28, 2013 at 6:45 am

In the late 1990′s, the CBO optimistically predicted, all things being equal, the payoff of the debt. Likely not since by 2000 the bubble was leaking air. That said, the Bush tax cuts were justified on And Cheney did say “Deficits don’t matter.” We would have invaded Afghanistan at any rate but Iraq? That was unnecessary. Both wars were fought on borrowed money, traditionally taxes go up to pay for wars even though war expenses might still cause deficit spending. However considering the wars cost “only” $1 T, fighting future wars mostly on borrowed money seems likely. Then there was other spending on borrowed money. The CBO predicted “over $1T,” not, “not one penny over $1T” for 2009 budget deficit. The deficit was a result of reduced revenue. Cutting spending to equal that cut in revenue would have likely put us in a depression. As it is the CBO stated the stimulus likely kept the economy from completely falling apart. Since 2009 the annual deficit has grown smaller as the economy has slowly grown even as spending has been cut likely depressing economic growth. And for fiscal year 2013 the CBO is predicting a deficit below $1T again. But with friends like the Congress, the economy certainly needs no enemies. So far austerity spending hasn’t bloomed the economies in Britain or any other country in Europe. They’re worse off than we are in many or most cases. It’s deficits in the future that need to be addressed, not right now. But we’ll see what happens with sequestration, if that causes the economy to bloom.

dirkmjk February 27, 2013 at 1:15 pm

On a related issue: according to these authors, common wisdom has it that there’s no penalty at the ballot box for budget cuts, but their research suggests there may well be a penalty in the form of social unrest: http://www.guardian.co.uk/commentisfree/2011/aug/16/austerity-programmes-cause-riots.

j February 27, 2013 at 2:51 pm

My question is more with regards to the fact that the budget deficit question in 2007 was more about the Iraq war and perhaps the Bush tax cuts. I guess that proves your point though: voters don’t like it when the other party spends money on things they don’t like!

Nadia Hassan February 27, 2013 at 3:36 pm

Any clear trends with pure independents?

Biotunes February 28, 2013 at 9:29 am

While not arguing with your basic premise, isn’t it possible that a tiny bit of the shift has to do with how the deficit money is being spent? In 2007 it was to fund tax cuts (mainly for the richer among us) and a war that nearly the whole country was opposed to by then. The current deficit spending is mainly an attempt to get the crashing economy that Obama was handed off the ground. Yes, there is plenty of hypocrisy to go around, but it’s not merely blind loyalty — it’s whether you agree with the party in power about how money is being spent, therefore based on substantive policy views.

doncastro February 28, 2013 at 11:35 am

How an economically literate person feels about deficits when an economy is expanding…as it was in 2007 prior to the downturn…and how he/she feels in a recession and/or during a struggling recovery…should be different.

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