While Republicans in Congress and the recently reelected President attempt to negotiate a budget deal, NC State students’ preferences about increasing revenue depend on whether those choices are described as tax increases or reductions in tax breaks. Students’ preferences about where to cut spending, however, are largely unaffected by information about what percent of the budget is taken up by various programs, and altering the programs they can pick modestly changes their choices.
A simple experiment
The recent survey, conducted Nov 12-13 by the PACKPOLL, included two questions about the federal budget: one about where to cut spending, and another about how to raise revenue.
These questions, however, were also each presented in a “split-ballot” format. At random, about half of the sample received one version of the spending cuts question that identified the percentage of the budget taken up by each are of the budget. For example, defense spending was identified as 20% of the budget. Other respondents were not provided this information, and were also given fewer choices to see whether the exclusion of some items would significantly alter their rankings.
For the question about raising revenue, about half of all respondents were asked which kind of taxes should be raised (“If the federal government were to increase revenue to try and reduce the national debt, which kind of tax do you most support increasing?”), while the other half were asked which kinds of temporary reductions in taxes should be eliminated (“letting deductions and loopholes expire”). Although the net revenue is arguably identical, framing how it is achieved could have important implications for public support.
What the students think
As a result, students responded quite differently to the revenue questions depending on which format they were given. A plurality (30%) chose increasing taxes on those making $250,000 or more in the version asking about tax increases, but overall their answers were fairly evenly split across a number of options. Another 17% chose “raising income taxes on everyone,” while 25% picked raising the taxes that large corporations pay. Interestingly, 20% of students did not support any tax increase at all. This latter result comes close to matching what Gallup finds in a different format of this question. Gallup reports that while the public now supports reducing the debt through a combination of revenue increases and spending cuts, nearly as many support only spending cuts with no increase in revenue (http://www.gallup.com/poll/158828/balanced-approach-cutting-deficit.aspx).
Students receiving the other set of answer choices, those calling tax increases “expirations of loopholes and deductions,” indicated much different results. Students supported letting tax loopholes and deductions expire for all income levels at a modest rate (11%). Only a slightly larger portion (12%) picked letting tax breaks expire for those making more than $250,000 per year only. Conversely, a majority (52%) of students said they’d support reducing the loopholes and deductions that corporations pay as their most preferred tax solution to the deficit. A smaller group of students than before claimed they would not support letting any deductions expire (9%).
While conceptually the same, “raising taxes” and “letting tax breaks expire” yield very different results. A clear majority of students wish to let corporate tax breaks expire yet not even a plurality would advocate “raising taxes that large corporations pay.” When tax increases were framed as “reducing loopholes and deductions,” 27% more students supported raising taxes on corporations.
The difference between letting temporary tax breaks expire (returning rates to their previous levels) and raising tax rates is a matter of semantics. To be fair, raising the corporate tax rate 5% and cutting the amount of deductions corporations can use by 5% is different, even if the net result is the same amount of gained revenue for the government. So, perhaps respondents read different actions into the answer optionses that large corporations pay.” When tax increases were framed as “reducing loopholes and deductions,” 27% more students supported raising taxes on corporations.
A note on Methodology: This PACKPOLL was our first ever “flash poll,” a quick turnaround survey with minimal questions. It was conducted from Monday morning to Tuesday night, November 12th-13th and was administered online using Qualtrics software. State students were contacted via a random draw of 3,000 of their email; 923 responded, resulting in a 31% response rate and margin of sampling error for the sample as a whole of plus or minus 3.2%. For split ballot questions, the sample is roughly halved for each version of the question, thus increasing the margin of sampling error. Other sources of error can exist, including non-response bias and measurement errors.
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