Friday, July 08, 2011

ECONOMY - Deficit Politics, Both Parties Tone-Deaf

"Can Obama, Congress Pull off a 'Big Deal' on Deficit Despite Political Perils?" PBS Newshour Transcript 7/7/2011 (includes video)

Excerpt

JUDY WOODRUFF (Newshour): Andy Kohut, you have been looking at what the American public thinks about the deficit, the debt. What do you find when you look at public opinion in terms of how they see the debt and what they think has caused the debt?

ANDREW KOHUT, Pew Research Center: Well, the debt and deficit, concern about it are at an all-time high.

Interestingly, we did a poll a few weeks ago which showed 60 percent saying that great contributions to this were the wars in Afghanistan and Iraq. Only 24 percent said increased domestic spending.

And while there is a lot of focus on domestic spending, if you talk to the ordinary person, it's -- that spending is seen as vulnerable if it involves waste, fraud and abuse, but when benefits or when the entitlements are considered, that's not considered waste, fraud and abuse.

JUDY WOODRUFF: So, when you -- when you ask them about the tradeoffs they're prepared to accept in terms of, you know, how much of -- how much cutting are you, as a citizen, prepared to see to deal with the debt, what do you find?

ANDREW KOHUT: Well, surprisingly, when you ask about what is more important, preserving benefits for Social Security and Medicare, by 2-1 -- or reducing deficit or the debt -- 2-1, people say, preserve -- preserve our benefits.

There is very little give there. Now, Republicans are of the view -- more of the view that reducing the -- reducing the deficit should be given high priority. But even among Republicans, it's really interesting. There is a big income divide. Affluent Republicans say it is more important to reduce the deficit, but poorer Republicans, middle-class and lower-middle-class Republicans say, no, no, protect our benefits.

JUDY WOODRUFF: And have -- are these attitudes, Andy, that have changed over time, with all the attention that's now being given to the size of the debt and the urgency of the problem?

ANDREW KOHUT: Well, a lot -- people are willing to do a lot of things to reduce this deficit. Concern is at an all-time high.

But when it comes to entitlements, there's no movement. It really is rock-solid when we see 2-1 margins.

JUDY WOODRUFF: And, again, entitlements meaning Social Security, Medicaid, and Medicare.

ANDREW KOHUT: And even Medicaid. Having states raise the -- make it more -- reduce eligibility for Medicaid, not 2-1, but a solid majority say, no, let's not do that.

JUDY WOODRUFF: Naftali, with all the public opinion in mind, what sort of divide, or is there one, between the leadership in the Democratic and Republican parties and the rank and file?

NAFTALI BENDAVID, The Wall Street Journal: I actually think that is one of the most interesting dynamics that we're seeing. President Obama and Speaker Boehner feel, I think, that it is in their interests to have a historic, grand deal that could burnish their legacy.

But the rank-and-file members, they have to run for reelection not too far from now. So any grand deal that includes benefit cuts to Social

Security and Medicare, that includes tax increases, they are much more resistant to. So, there's a couple things that have to happen here.

Obama and Boehner have to agree on something, and then they also have to sell it to their members. And both of those things are equally important.

JUDY WOODRUFF: One of the -- I guess one of the overriding sense, senses that one gets out of all this is that more of the debt reduction would come from cuts, from cuts in entitlement, than it would on the revenue side. Is that pretty much a given?

NAFTALI BENDAVID: That is pretty much a given. I think there is something about the way the political landscape has evolved, that people are willing to accept far more cuts, even Democrats, spending cuts, rather than tax increases.

I mean, tax increases have become such anathema, such political poison in the political dialogue, that I think people are talking about a 3-to-1 ratio or something approaching that.

ANDREW KOHUT: And that is completely opposite to public opinion.

When we say, if push comes to shove, if you have to do something, what would you rather see with respect to these entitlements, revenues increased, or taxes increased, or benefits cut? People say, raise taxes, raise costs, but don't cut those benefits.

JUDY WOODRUFF: And you see that across the board?

ANDREW KOHUT: See that across the board.

JUDY WOODRUFF: Republican -- what about Republican vs. Democrat?

ANDREW KOHUT: Well, there is a gap on this, but when you get such large 2-1 margins and you have this class division within the Republican Party, that is potentially big stuff come election time. There will be a huge cry and howl if benefits are seen to have been -- to have been cut here.

JUDY WOODRUFF: And so I hear you saying some of the public reaction is going to depend on how this is packaged, how it is described to the American people, whatever -- if they come up with an agreement.

ANDREW KOHUT: Right.

I mean, there is support for raising the contribution cap, of doing some things like that. But the notion that the retirement ages will be delayed or in some way people are going to have to pay a larger share of their Medicare costs out of their pocket, all of those things are very, very unpopular.

See. Both Republicans and Democrats are NOT listening to voters. We, the people, have come to realize that the government (local/state/federal) NEED increased revenue (aka tax increases) but BOTH parties are tone-deaf on the subject.

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