Does Misunderstanding Taxes Inflate People’s Support for Medicare Spending?

Abstract

Medicare consistently receives widespread bipartisan support despite being one of the most expensive social programs in the United States. I examine whether support for spending on Medicare is inflated by people’s misunderstanding of how the program is financed. In a preregistered national survey experiment, I reveal to some participants that only a third of Medicare’s funding comes from highly visible payroll taxes, and many enrollees pay less in taxes than the cost of their benefits. Participants in each treatment answer how much they support or oppose spending on Medicare. Support for Medicare spending was diminished significantly among treated Democrats, Republicans, and Independents compared to participants who received only basic information about the goals of Medicare. I discuss implications for Medicare solvency and democratic transparency.