Who Would You Stop Paying First If Debt Ceiling Isn't Raised?

What to cut?
What to cut?

The debt ceiling debate continues to rage inside the Beltway, but are Americans tuning it out?

New results from the Chicago Booth/Kellogg School Financial Trust Index shows that 46% of people surveyed have no opinion on the issue. However, of those who are following the issue, more than two-thirds are against raising the debt ceiling and one-third favored raising it.

Half of the survey respondents were also asked about the potential financial consequences if the debt ceiling is not raised by the Aug. 2 deadline. The majority responded that the U.S. Treasury debt holders should be the first group the government defaults on, followed by nonmilitary government employees.

Raising The Debt Ceiling
Raising The Debt Ceiling

Only 10% of respondents said the government should cut back on paying the Army, and even fewer, 7%, said Social Security recipients. The survey was conducted in a telephone poll of 1,003 people between June 15 to June 23.

The researchers also found that survey respondents fell along political lines, with the majority of those in favor of raising the debt ceiling identifying as Democrats, and those who said no to raising the debt ceiling more likely to be Republicans or Independents. According to the report:

"Although half of the participants were forced to think about tough economic choices – that not raising the debt ceiling may eventually force the United States to default on its obligations – this didn't influence their stance on the issue," said Luigi Zingales, co-author and professor of entrepreneurship and finance at the University of Chicago Booth School of Business. "In fact, what we found is that support or opposition was correlated with political affiliation, reinforcing the role of politics in driving opinion in this debate."