Posted at 6:00 AM ET, 03/ 3/2011

Four pinocchios for the American public on the budget

By Glenn Kessler

"Poll: Americans confused by budget"

--Politico headline, March 2, 2011

The American public appears to be clamoring for a discussion

about the size and scope of the federal government. But how
can Washington have a serious debate when most Americans
are ignorant of what is in the budget?
Yet another depressing survey was released this week that
attests to the failure of most Americans to understand the
basics of the federal budget -- and why there is a soaring
budget deficit. Respected Republican pollsters Ed Goeas and
Nicholas Thompson reported that 63 percent of those surveyed
believe the federal government spends more on defense and
foreign aid than it does on Medicare and Social Security. (That's
wrong.)
A similar majority believes that problems with the federal
budget can be fixed by just eliminating "waste, fraud and
abuse" -- and that 42 percent of every federal dollar is wasted.
"Voters do not casually agree with these untruths -- at least 40
percent strongly agree," the pollsters said.
This survey is broadly reflected by other polls, recently
collected by analyst Bruce Bartlett. Among the gems he
uncovered:
A Nov. 30 poll by WorldPublicOpinion.org found that, when
people were asked what percentage of the federal budget goes
to foreign aid, the average response was 27 percent. (The real
number is about 1 percent.) The estimates were essentially the
same for Democrats, Republicans and independents.
A Jan. 26 Gallup poll found 59 percent of people favor cuts to
foreign aid, but a majority oppose cutting any other programs,
including Social Security, Medicare and education.
A Jan. 12 Ipsos/Reuters poll found that 75 percent of people say
foreign aid should be cut, but the only other programs that a
majority of people favor cutting are the budgets of the Internal
Revenue Service and the Securities and Exchange Commission.
The Facts
Take a good hard look at the chart above. Or go to this nifty interactive web page on
washingtonpost.com, which allows you to see what has happened to the budget over the last three
decades.
Notice that foreign aid is so small in the above chart that it doesn't even merit a mention. While it's
about 1 percent of the overall budget, it amounts to less than 3 percent of the dollars allocated year
after year by Congress, known as the discretionary budget. Perhaps some people lump together foreign
aid with military spending, since a lot of military dollars go to wars overseas. Certainly the military is a
big part of the budget -- about 25 percent -- but that is not foreign aid.
In fact, compared to other wealthy countries, the United States is an absolute miser on foreign aid. The
best way to compare budgets is by looking at how much is spent as a percentage of the country's overall
economy, or gross domestic product. This 2008 list shows the United States as last among 22 countries,
with 0.19 percent of GDP. The United Nations has set a target contribution rate of 0.7 percent, and the
average country contribution was 0.45 percent. Some countries come close to donating 1 percent of
GDP in foreign aid.
Nevertheless, House Republicans have targeted foreign aid for major cuts this year, with lawmakers
even eliminating all funding for the U.S. Institute of Peace, which helps resolve bloody conflicts
overseas. (One analyst has noted that the USIP's entire annual budget is equal to the cost of deploying
one infantry platoon -- that's about 30 to 40 people -- to Afghanistan for a year.)
To some extent, politicians are to blame for some of the public confusion. The debate in recent weeks
has focused on cuts in the discretionary part of the budget -- which is only about one-third of the
government's $3.7 trillion budget -- and the tiny sliver of spending on foreign aid was a big part of that
debate. For his part, President Obama, in his 2012 budget, highlighted cuts to relatively minor programs
and avoided making proposals for reining in the cost of the big-ticket spending programs.
Look again at the chart. Much of the budget -- more than 40 percent -- is spent on social insurance, such
as Social Security, Medicare and Medicaid. The interactive graphic shows that spending in those
programs have soared in the last 30 years (while foreign aid has essentially stayed flat). Projections
show the spending in those programs will only increase, especially as more of the baby boom generation
heads into retirement.
That's where the money is. Politicians should be honest about the real sacrifices that will be needed, by
all Americans, to deal with the looming sacrifices necessary to bring down budget deficits. Cutting
development aid in Africa really will not make much of a difference.
Interestingly, a recent study by the University of Maryland found that when people were actually given
the facts about the budget, they could seriously understand and make choices about how to deal with
the deficit.
In fact, the results upended some of the usual media stereotypes, with Democrats cutting spending
more than Republicans -- and members of both parties agreeing to raise taxes. (Even after the survey,
though, the respondents continued to have a misperception of foreign aid, with the median response
being that it was about 15 percent of the budget and that it should be about 5 percent -- still much
larger than the actual percentage).
The Pinocchio Test
No matter what rhetoric politicians use about the budget, people need to find out the facts in order to
understand the costs, the trade-offs and the challenges ahead. Every year, when the president
releases his budget, newspapers print pie charts showing how the money is spent. The budget is
publicly available on the Web. There should be little excuse for not knowing the basic facts about
how the U.S. government spends taxpayers' money.
Four Pinocchios