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Friday, July 15, 2011

President Obama, the American Public, and the Debt Crisis

Polls have been a topic of discussion in presidential press conferences and press briefings twice this week.

President Obama on Monday was asked about a poll showing that the majority of Americans were opposed to raising the debt limit. Obama responded expansively, in essence saying two things. First, that he didn’t think the public was knowledgeable enough to weigh in on this subject (“…The public is not paying close attention to the ins and outs of how a Treasury option goes. They shouldn’t. They're worrying about their family; they're worrying about their jobs; they're worrying about their neighborhood. They've got a lot of other things on their plate. We're paid to worry about it”).

Second, that if he wrote a poll question on the topic he could get majority support for raising the debt limit. (Here’s his question: “…if you said to the American people, is it a good idea for the United States not to pay its bills and potentially create another recession that could throw millions of more people out of work, I feel pretty confident I can get a majority on my side on that one.”)

Later this week Press Secretary Jay Carney was asked about a Gallup poll showing that people didn’t want to raise the debt ceiling. Carney -- obviously briefed on the same talking point Obama used -- responded in similar fashion: “So I think it’s easy to understand why most Americans don’t have a lot of time to focus on what is a debt ceiling. I mean, honestly, did anybody in this room, before they had to cover issues like this, have any idea what a debt ceiling was?

So it’s clear that the White House strategists have decided that their way of publicly dealing with poll results on the debt ceiling issue is to dismiss it under an assumption that the topic is too complex for the public. Therefore, the public’s responses are not terribly meaningful. I say “publicly” in the previous sentence because it is highly likely that the Obama team is being briefed on, if not conducting, its own internal public opinion research on this topic.

Others in the media have adopted this same type of take on polls on the debt. One news site reported a question from this week’s Gallup poll on the topic thusly:

"It may say more about the state of economic education than anything else but a majority of Americans remain opposed raising the federal debt ceiling according to a new Gallup poll. And that's despite dire warnings by experts that a default by the U.S. government could be calamitous. It would likely cause higher interest rates not just for the federal government but throughout the economy."

The underlying assumption on the part of the journalist who wrote this, of course, is that the public’s state of economic education is not all that great.

If that’s true, then we might expect that those who are paying the most attention to the issue, and those with the highest levels of education, would be most strongly in favor of raising the debt ceiling.

However, that’s not the case. As pointed out by my colleague Lydia Saad in her recent analysis, those Americans following the issue very closely tilt almost as strongly against raising the debt ceiling as those who are not following it closely. In terms of education, college graduates are as likely to oppose raising the debt ceiling as those with some college or only a high school degree. Those with post graduate degrees -- who tilt Democratic in party orientation -- oppose rather than favor the idea of raising the debt ceiling, albeit by a smaller 44% to 40% margin.

Take a look at the reasons given by those who oppose raising the debt ceiling, as discussed here:

These appear to be fairly rational responses. They don’t seem to suggest that the 42% of Americans who opposed raising the debt ceiling are totally clueless. Of course, these open-ended responses don’t address directly the issue raised by Obama -- that people may not be aware of the deleterious consequences of not raising the debt ceiling. But they do show that those opposed to raising the debt ceiling have fairly well-thought out explanations. Also, we know that those who are in favor of raising the debt ceiling are aware of the type of consequences Obama brought up. Read through the responses given by the pro-raise-the-debt-ceiling respondents below:

All in all, it seems that the type of knowledge available to the experts in Washington who are, as the president put it, paid to worry about such things, is also to at least some degree available to the hoi polloi.

In our recent poll, we asked respondents which they worried about more -- not raising the debt ceiling and therefore opening up the country to an economic crisis, or raising the debt ceiling without plans for major spending cuts in future spending. The answers showed that Americans were more worried about the latter than the former.

Of course, the first of these is essentially Obama and the Democrats’ position. Our wording of the question was not as dramatic and dire as the wording suggested by the president in his press conference. But the results show that when reminded of the consequences of a “crisis,” Americans still tilted toward being more concerned about the consequences of raising the deficit without cutting back spending.

Wall Street Journal and NBC News polling came at this in a somewhat different way in two recent surveys, one in April and one in May. They gave respondents arguments on both sides of the debt ceiling issue.  They changed the wording in the arguments significantly between the two dates, but when we focus just on the wording used in the May survey we find a statement somewhat like the one suggested by Obama:

“Some people say raise the debt ceiling because failing to do so could stop the government from meeting its obligations, including payments to those on Social Security and in the military, and cause a shock to the economy. Efforts to control debt should be comprehensive and long term rather than artificial and short term.”

The writers of the WSJ-NBC News survey used the following wording on behalf of the “don’t raise” the debt ceiling position:

“Some people say do not raise the debt ceiling because doing so will make it easier to increase spending and harder to reduce the deficit, and will increase the debt held by other countries and passed on to the next generation”.

With these two arguments included in the question, the responses broke almost even -- 46% against raising the debt ceiling, and 42% in favor of it. When a milder explanation of the “pro-raising the ceiling” position was used in April, including most importantly not including the specific words “Social Security” and “the military,” the responses broke 62% against, and 32% in favor of raising the debt ceiling.

These results suggest that public opinion can be moved on the issue of the debt ceiling when various arguments are presented pro and con.

Mark Blumenthal at Huffington Post, admirably collected and analyzed a number of other questions which have been asked about the debt ceiling with various explanations and rationales and arguments attached.

His review basically shows, as I’ve been saying here, that opinion can be moved in one direction or the other on this issue with various arguments included in the question wording, but -- as was the case in the WSJ-NBC News poll -- that there is no evidence that Obama's type of argument wins out in some dominant fashion when arguments on both sides are made by pollsters.

Gallup asked a “naked” question about the debt in our most recent poll (by naked, I mean without explanations or discussions of the rationale). We found Americans more opposed than in favor of raising the debt ceiling by a 20 percentage point margin, with a little more than a third having no opinion on the issue.

Many leaders who have well-thought out and fiercely held beliefs and positions assume that if the public looked at the issues just as thoughtfully and thoroughly as they did, the public would come to the exact same conclusions as they (the leaders) have. These leaders naturally assume that if available evidence shows that the public does not share their beliefs, then the public’s grasp of the issues must not be well-thought out or thorough.

This is the type of position adopted by Obama in his press conference -- that Americans’ opinions were not valid since Americans are not paying attention to the debt issues and are not in a position to grasp the complexities of what is involved, and that if Americans were given the facts they would shift strongly towards his position.

The data don’t fully support these contentions, however. I would say a) there is little evidence that the most informed Americans and those paying most attention to this issue are heavily in favor of Obama’s position on this issue, as he implied they would or should be, and b) there is little evidence that if Americans are given both the type of argument in favor of raising the debt ceiling suggested by Obama and an argument against raising the debt ceiling along the lines of the Republican position, that they come down heavily in favor of the Obama position.


Best Forex said...
July 16, 2011 at 7:07 PM  

President Obama is living in a dream world. He put forward a budget that not even 1 democrat voted for it in the Senate. And yet, he keeps hammering on this tax hike thing as if these people are not paying taxes enough.

Wealth is in the mind and therefore no amount of money thrown at an un-wealthy mind can become wealthy. Help the people to change their thinking and all of a sudden is like the light bulb comes on and they begin to see the possibilities even in a time of economic recession.

Anonymous said...
July 17, 2011 at 7:08 AM  

Mr. Newport:

One would expect you to defend your polling, but one shouldn't pay attention to that defense, because of your incentive bias. Charlie Munger makes the point well in his speech the Psychology of Human Misjudgment.

Public opinion is rarely correct, especially on issues of Modernity (slavery, voting, Women's Rights---all are issues that come to mind). Look at the Muslim world, today, where public opinion is shaped by the Koran.

You poll question is meaningless, for it is stripped of context.

A more meaningful question would have been: Should the United States take any action permitted by the Constitution that will reduce unemployment? 100% of the population would have to answer, Yes.

Your broader question permits the person answering to project their lack of knowledge, information, limitations, and bias, which is plain to anyone reading the question.

Contrary to your arguments, being interested does not mean being informed. The Civil War proved that.

Anonymous said...
July 23, 2011 at 11:54 PM  

Anonymous clearly believes polls are to create consent. What do we learn by asking questions to which there is only one answer? Stripping a question of context allows for the one being asked TO project their knowledge or lack thereof, and bias. THAT is the point: From whatever background they come, what do the people BELIEVE?! Only poll questions asked TO solicit a specific, consensual answer are meaningless!

I'd love to see a poll of those who don't believe a crisis, or default will result from raising the debt ceiling (me)asking: Why don't you believe a crisis or default will result in our governments failure to raise the debt ceiling? MY answer: Beginning with Bush II, EVERYthing has been a crisis. The end of the world or worse is going to happen unless we XYZ. Decisions made under this premise have been terrible (invading Iraq, bailing out the banks, the legislation passed to stimulate the economy and create jobs that has FAILED). I'm left to wonder what could be worse than all these actions we've taken under the threat that doing nothing would be worse. I'd like to know if that is why a sizeable minority aren't afraid of the consequences of failing to raise the debt ceiling.

Anonymous said...
July 25, 2011 at 4:28 PM  

if your credit card debt was so high that it took 42% of your income just to pay the intrest, would you still keep using it, would/should a bank allow you to use it. today or tomorrow you/we will default, history proves this to be true. eat the damm peas now

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