America's Fiscal IQ: Don't Know Much About Deficits

A new poll shows that voters misunderstand entitlement programs, taxation.

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Caring about an issue and knowing about it can be two completely different things. Many Americans have strong views on how to fix the nation's ever-growing deficits and debts. But there are gaps in what, exactly, voters know about the subject. A new poll shows that many Americans lack basic knowledge on the nation's fiscal situation.

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Americans are relatively knowledgeable on a few key points but uninformed on others, according to the National Fiscal IQ poll by the Comeback America Initiative, a nonpartisan organization that seeks to promote fiscal responsibility. The poll of 1,000 registered voters shows that a significant majority—62 percent—understand that U.S. debt as a percentage of GDP rivals or exceeds that of several troubled European nations (margin of error of 3.1 percent). And 73 percent understand that government healthcare programs are not financially sustainable. As the Congressional Budget Office reported earlier this year, spending growth in these programs cannot continue at its current rate indefinitely.

[Want to test your fiscal IQ? Visit fiscaliq.net.]

However, respondents were less well-informed about how they personally relate to the federal deficit. Sixty-eight percent of respondents believe that most individuals pay more in payroll taxes and medicare premiums than they end up receiving from Social Security and Medicare—a statement that is false. And a plurality of respondents, 49 percent, believe that U.S. taxation is above-average compared to other industrialized nations—also a false statement.

"There's been a lot of disinformation and misinformation," says David Walker, former U.S. comptroller general and the founder of the Comeback America Initiative. "Leaders are supposed to educate people as to the facts, truth, and help make tough choices. ... While we've had a lot of these national [bipartisan deficit-reduction] commissions, none of them have done any meaningful work to try to educate the American people about the issues that they're going to have to understand and accept in order for the officials to make these tough choices."

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Walker believes the problem is widespread, with both major political parties, individuals, and special-interest groups all contributing to these misperceptions.

Of course, the news media is how people receive this information, and coverage that does not explore issues in-depth also helps to explain Americans' lack of knowledge on some issues.

"The media's not very good at explaining details. The media is good at talking about game stuff—'will we pass or not pass X,' not 'what's the meat of this about?'" says Kimberly Gross, associate professor of media and public affairs at George Washington University. For example, she says, many Americans may not understand the complicated benefits and funding structures of entitlement programs like Social Security or Medicaid.

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A media that closely monitors politicians' every move means that politicians can often set the agenda for what messages are broadcast, promoting particular narratives—sometimes not entirely factually based—to broad swaths of the public. "Partisans have an investment in telling certain stories," says Gross. For example, she says, "Democrats might say, 'We don't need to cut entitlements, and we can tax the rich.' ... Republicans might say, 'If we just lower taxes, more money really will come in.'"

Despite a persistent national atmosphere of partisanship, the poll does reveal some common ground, with 88 percent of voters agreeing that deficit and debt burdens are a national threat. In addition, knowledge levels about those issues are even across party lines. The poll also measured "fiscal IQ," a measure of respondents' factual knowledge as well as views on which potential solutions are realistic. The poll found that "fiscal IQ" scores were 60, 60, and 62 for Democrats, independents, and Republicans, respectively.