Has Obamacare Turned Voters Against Sharing the Wealth?

By Thomas B. Edsall
The New York Times, April 15, 2015

With the advent of the Affordable Care Act, the share of Americans convinced that health care is a right shrank from a majority to a minority.

This shift in public opinion is a major victory for the Republican Party. It is part of a larger trend: a steady decline in support for redistributive government policies. Emmanuel Saez, an economics professor at Berkeley and one of the nation’s premier experts on inequality, is a co-author of a study that confirms this trend, which has been developing over the last four decades. A separate study, “The Structure of Inequality and Americans’ Attitudes Toward Redistribution,” found that as inequality increases, so does ideological conservatism in the electorate.

The erosion of the belief in health care as a government-protected right is perhaps the most dramatic reflection of these trends. In 2006, by a margin of more than two to one, 69-28, those surveyed by Gallup said that the federal government should guarantee health care coverage for all citizens of the United States. By late 2014, however, Gallup found that this percentage had fallen 24 points to 45 percent, while the percentage of respondents who said health care is not a federal responsibility nearly doubled to 52 percent.

“The Structure of Inequality and Americans’ Attitudes Toward Redistribution,” suggests that Democratic programs providing tax-financed benefits to the poor are facing growing hostility. The author of the paper, Matthew Luttig, a Ph.D. candidate in political science at the University of Minnesota, found that while “numerous political theorists suggest that rising inequality and the shift in the distribution of income to those at the top should lead to increasing support for liberal policies,” in practice, “rising inequality in the United States has largely promoted ideological conservatism.”

I asked two experts, Jacob Hacker, a political scientist at Yale, and Robert Frank, an economist at Cornell, if Luttig’s conclusions are consistent with their own research, and both said he is on target.

“The General Social Survey shows there has been a slight decrease in stated support for redistribution in the US since the 1970s, even among those who self-identify as having below-average income,” according to Saez and his three co-authors, Ilyana Kuziemko, a professor at Columbia Business School, Michael I. Norton, a professor at Harvard Business School, and Stefanie Stantcheva, a junior fellow at Harvard.

Even worse for Democrats, the Saez paper found that “information about inequality also makes respondents trust government less,” decreasing “by nearly twenty percent the share of respondents who ‘trust government’ most of the time.”

The findings of the Saez group are consistent with Luttig’s. Taken together, they suggest that even if Democrats win the presidency and the Senate in 2016, largely on the basis of favorable demographic trends, the party will confront serious hurdles if it attempts to deliver material support to working men and women and the very poor. Redistribution is in trouble, and that is likely to tie American politics in knots for many years to come.

http://www.nytimes.com/2015/04/15/opinion/has-obamacare-turned-voters-ag…

Matthew Luttig:  The Structure of Inequality and Americans’ Attitudes Toward Redistribution

http://poq.oxfordjournals.org/content/early/2013/09/11/poq.nft025.abstract

Ilyana Kuziemko, Michael I. Norton, Emmanuel Saez, and Stefanie Stantcheva:  How Elastic Are Preferences for Redistribution? Evidence from Randomized Survey Experiments

https://www0.gsb.columbia.edu/faculty/ikuziemko/papers/kuziemko-norton-s…

Thomas Edsall states that, as income and wealth inequality have expanded, the number of Americans who believe that health care is a right has declined from a majority to a minority. Of particular concern is Matthew Luttig’s finding, supported by others, that “rising inequality in the United States has largely promoted ideological conservatism.”

What mechanism might explain this? Gilens and Page have shown that the very wealthy have control over the political process. Part of that control is through the media and other forms of public communication.

Redistribution (or transfer) refers to the process of collecting taxes, largely progressive, and distributing those funds based on public need. Some public services benefit everyone, but other services disproportionately benefit those with basic needs who do not otherwise have the funds to pay for them.

Those who benefit from tax reduction have been successful in creating the meme that government redistribution through tax and spending policies is is an inappropriate role of government, a concept that, ironically, is especially prevalent amongst the poor and relatively uneducated.

Quoting from Kuziemko, Saez, et al (link above):

“About 5,000 respondents were randomized into treatments providing interactive information on U.S. income inequality, the link between top income tax rates and economic growth, and the estate tax. We find that the informational treatment has very large effects on whether respondents view inequality as an important problem. By contrast, we find quantitatively small effects of the treatment on views about policy and redistribution: support for taxing the rich increases slightly, support for transfers to the poor does not, especially among those with lower incomes and education.”

Further, they state:

“An exception is the estate tax — we find that informing respondents that it affects only the very richest families has an extremely large positive effect on estate tax support, even increasing respondents’ willingness to write to their U.S. senator about the issue.”

In addition:

“We also find that the treatment substantially decreases trust in government, potentially mitigating respondents’ willingness to translate concerns about inequality into government action.”

So what can we make of this?

The nation strongly supports Social Security and Medicare – both very important programs that involve redistribution – yet the topic of redistribution is rarely mentioned in discussions of these programs, with the exception of those who would reduce redistribution by privatizing these programs.

Although many have concerns about redistribution of income, that does not seem to carry over to their views on redistribution of wealth. When people understand the degree of wealth inequality and the selective application of estate taxes, they become even more supportive of taxing those large estates.

Just as people believe the meme that “the government can’t do anything right,” even though they truly support most specific government programs, people seem to be swayed by the newly implanted meme that redistribution is a function of a government that cannot be trusted, even though they support specific programs involving redistribution. This seems to represent the phenomenon wherein empty rhetoric threatens to spill over into policy positions.

Conservatives and libertarians do support catastrophic insurance plans – clearly a private sector redistribution from those who do not experience specific losses to those who do. So the opposition is not to the concept of redistribution itself, but rather it is an ideological opposition to the government role in redistribution.

A component of this opposition is the objection to being forced to participate in a redistribution pool such as health insurance coverage. Some individuals would prefer to accept the risk of personal financial ruin even if their losses are passed onto their fellow Americans. It is the latter reason that establishes the legitimacy of the government in requiring participation of all – preventing individuals from electing to be free riders at a cost to the rest of us. Nobody supports policies requiring themselves to pay more to cover those who shirk their responsibilities to pay their own share (ideally through equitable taxes).

So do Americans believe that health care is a right? The answer is muddled by rhetorical memes, but, in general, they actually do believe that the financing of health care is a collective responsibility.