Do Americans Trust Goverment Less Because It’s Become an Insurance Broker?

At the end of an interesting and data-packed post on the growth in federal spending, Nate Silver offers a hypothesis:

Nevertheless, the declining level of trust in government since the 1970s is a fairly close mirror for the growth in spending on social insurance as a share of the gross domestic product and of overall government expenditures. We may have gone from conceiving of government as an entity that builds roads, dams and airports, provides shared services like schooling, policing and national parks, and wages wars, into the world’s largest insurance broker.
Most of us don’t much care for our insurance broker.

Nate suggests that the growth in spending on social insurance is changing what goverment does and perhaps making people trust the government less.  The former is undoubtedly true.  I am more skeptical about the latter.  Here is why.

Nate looks at the growth in entitlements as a percent of GDP, and categorizes spending on health care, education, and welfare as entitlements.  (The data are available here.)  I think I’ve adequately replicated the trend he documents, though focusing on the period from 1958-2011.

And now the trend in trust in the federal government.  This is the percentage who say that you can trust the “government in Washington” “just about always” or “most of the time,” using data from the American National Election Studies, supplemented with an October 2006 CBS News poll.  (Adding more data from public polls would show the same trend.)

The two trends don’t appear to square that well.  Entitlement spending increases consistently, if not linearly.  But trust in government has important peaks and valleys.  It hasn’t simply declined since the 1970s.

What happens if we plot the relationship for those years were we have both sets of data?

Using all the data, 1958-2008, there is a negative correlation: more entitlement spending coincides with lower trust in government.  But this relationship leans heavily on the period from 1958-1972 (or 1958-1974 or 1958-1976—you can cut the data a couple different ways and get the same finding).  Once we focus on the period from 1974 onward, there is no meaningful correlation.  This is despite the fact that entitlement spending increased from 9.5% of GDP in 1974 to 15.7% in 2008.  So a lot depends on how you want to interpret the decline from 1964-1972 or thereabouts.  Entitlement spending did increase during this time—it nearly doubled—but there were also an economic slowdown, the Vietnam War, and Watergate.

Of course, these data don’t speak to the more subtle question of whether popular conceptions of government have changed as government has devoted more resources to entitlements.  That said, it’s also worth mentioning that entitlement programs like Social Security and Medicare are among the most popular (though less so Medicaid and welfare, obviously).  People may not care for their insurance broker, but they do seem to like government insurance.

[Full disclosure: I have been an occasional contributor to the 538 blog.]

6 Responses to Do Americans Trust Goverment Less Because It’s Become an Insurance Broker?

  1. EvdM January 17, 2013 at 5:35 pm #

    Entitlement spending may not affect trust in government, but it must surely affect the number of cyclones.

  2. rvman January 17, 2013 at 7:04 pm #

    The big spike up in “trust government” is obviously 9/11. I think you have to look at 2002 and 2004 as outliers due to an exogenous shock. Take those out and the trend still looks good, albeit noisy. In fact, the 1974-2008 flattening is a strong argument in favor of the the thesis – the Great Society increase in social insurance occured in the ’60s. Since ’74 the trend had been, until Bush, much slower growth in entitlements.

    • John Sides January 17, 2013 at 7:56 pm #

      rvman: First, the spike you’re pointing to began in the 1990s, well before 9/11, and is more connected to the growth in the economy. Second, if you take out 2002 and 2004, that does nothing to affect the lack of relationship between 1974-2008. Third, the rise in entitlement spending grew much more after the 1960s and the Great Society than during. There is more growth in entitlements since 1974 than before.

      • rvman January 18, 2013 at 2:49 pm #

        True, the second graph shows that the climb begins pre 2001. I was looking at the third graph, graphing trust against Entitlement GDP share with the years marking the points. In that graph 1996, 1998, and 2000 are very near the black (long run) trendline while 2002 and 2004 are quite far distant from it. My particular ‘criticism’ is to note that the red trendline is highly influenced by the 2002 and 2004 data points, both being outliers with an obvious cause exogenous to this relationship, and thus should be controlled for. Same with the black trendline, which would probably be steeper in the absence of the two 9/11-related outliers.

        I will note that from 1996 to 2000, entitlement share fell while trust rose, but as you say that particular adjustment probably more easily attributed to a good economy – both variables should be strongly correlated to economic performance independent of each other. It is hard to say what 2002 would have looked like without 9/11, given the economic mess of the bubble imploding just around that 2000-2002 timeframe.

  3. Eric January 18, 2013 at 1:37 am #

    He may be wrong, but I do think this is one of the more interesting and important discussions to be having right now.

  4. Howard Clark January 18, 2013 at 11:01 am #

    I’d like to posit a different cause and effect loop.

    As industrial management techniques have been driven into public services (through call centres, automated voice recognition and shared services), the public services that people rely upon has moved physically further away from them.

    The state (as in a an entity their to serve and help its people) no longer has a human face. Public services have been industrialised and automated with unintended consequences. One of those consequences is that public services have increased in cost and not decreased. And if we don’t know who the state is in our day-to-day lives, of course we won’t trust them.

    That’s just my hypothesis, but read this as it might be of interest.