Has the mainstream gone Tea Party, or the Tea Party gone mainstream? Despite warnings from the White House of the “deeply irresponsible” nature of “play[ing] chicken” with the national debt-limit ceiling, a Reuters poll of adults shows almost three-quarters of Americans opposed to further increases in the statutory borrowing cap. But consensus gets smaller on what to cut instead (via Quite Normal):
Some 71 percent of those surveyed oppose increasing the borrowing authority, the focus of a brewing political battle over federal spending. Only 18 percent support an increase.
The poll underscores the tough task ahead for U.S. lawmakers as the debt nears its current ceiling of $14.3 trillion. Treasury Secretary Timothy Geithner last week warned that a failure to raise the borrowing limit in the coming months could lead to “catastrophic economic consequences”.
Republicans, who won control of the House of Representatives in November on a promise to scale back government, hope to pair any debt-ceiling hike with a commitment from President Barack Obama to reduce long-term spending.
The topline result is staggering. It shows that the Tea Party’s aversion to further borrowing and spending has hit a resonant chord with Americans, and today’s warnings on bond ratings will only intensify it. Right now, the White House stands with just 18% of the public, and likely an even smaller percentage of likely voters in the next cycle.
But if we don’t raise the debt ceiling, cuts have to come immediately to stave off a default, which could create a global financial collapse. Where do people see the potential for enough cuts to avoid further borrowing? Those results are also somewhat surprising, and a little contradictory:
- Education – 24%
- Military – 53%
- Environmental enforcement – 45%
- Financial regulation enforcement – 53%
- Social Security – 20%
- Medicare – 23%
- Foreign aid – 73%
- Tax collection efforts – 65%
That’s interesting, but not very realistic. Foreign aid and the cost of tax collection are not very large parts of the budget. Even eliminating them all would hardly put a dent in deficit spending, which is what drives the need to raise the debt limit. The same is true for environmental and financial regulatory enforcement, although scaling it back would create an economic boom that would raise revenues appreciably to help close the gap some. The Pentagon spends around $700 billion, and probably has room for substantial reduction if we rethink our global position, but the deficit is $1.3 trillion, or almost two Pentagons.
In order to really get at the heart of federal spending, entitlements need to be on the table, and right now. We need to start scaling them back to safety-net size rather than comprehensive entitlements. Federal pension systems have to be transformed into defined-contribution rather than defined-benefit plans. It won’t be popular, but structurally, that’s the only approach to the budget that gets us back to fiscal balance.