The nation is headed toward a possible government default on Aug. 2 if no agreement is reached to raise the debt ceiling. The public is still coming to grips with this complex issue, but recent Pew Research Center surveys show that opinions are beginning to take shape:

The Bottom Line. The public has grown more concerned recently that failing to raise the debt limit would force the government into default and hurt the economy. However, fewer than half of Americans (42%) say their greater concern is over not raising the debt limit; about as many (47%) say their greater concern is that raising the debt limit would lead to more government spending, according to this week’s survey by the Pew Research Center for the People & the Press and The Washington Post. The deep partisan divisions evident in Washington’s negotiations over the debt ceiling are reflected in the survey’s results – most Republicans (66%) are more concerned by the consequences of increasing the debt limit; most Democrats (54%) are more worried by the fallout from not raising it.

No Panic – Yet. The debt crisis has been the dominant issue in Washington for weeks, but public interest in this story has been relatively modest. In this week’s News Interest Index survey, just 25% said they are tracking the debt talks very closely, a figure that has changed little in recent weeks. Interest is likely to grow as the Aug. 2 deadline approaches, however. During the budget showdown in the spring, public attentiveness ramped up dramatically when a last-minute compromise narrowly averted a government shutdown.

A Complicated Issue. The Pew Research Center/Washington Post survey found that just 18% feel they understand this issue very well, while another 37% say they understand it fairly well. That is relatively low, particularly considering that in the fall of 2008, far more (75%) said they understood the problems in financial and housing markets very or fairly well, which involved terms like troubled assets, underwater mortgages and “too big to fail.”

Balancing Priorities. Few disagree that the budget deficit is an urgent problem –in late May, 74% said it is a major problem the country must address now. But when asked which economic issue worried them most, more cited the job situation than the budget deficit (by 38% to 28%). Pew Research’s annual policy priorities survey in January showed that the percentage saying that reducing the budget deficit should be a top priority jumped from 53% in 2009 to 64% this year. But the deficit ranked far lower than the economy (87%) and jobs (84%) on the public’s 2011 agenda.

Don’t Cut Benefits. For the public, reducing the deficit is a much lower priority than preserving the benefits provided by Social Security and Medicare: In mid-June, 60% said it was more important to keep these benefits as they are, while just 32% said it was more important to reduce the deficit. Less affluent Republicans view preserving entitlements as more important, while Republicans with higher incomes prioritize deficit reduction. Democrats across income categories say it is more important to keep benefits as they are.

Taxes in the Mix. Americans like lower taxes; when President Obama and congressional Republicans agreed on an extension of the Bush-era tax cuts in December, 60% of the public approved of the deal. But most also acknowledge that the best way to reduce the deficit is through a combination of cuts in major programs and tax increases. And a large majority (66%) approves of raising taxes on incomes of $250,000 or more to reduce the debt.

No Compromise on ‘Compromise.’ It may seem like diplomats arguing over the shape of the conference table, but Republicans and Democrats cannot even agree about whether compromise is a good thing. During the budget impasse in April, large majorities of liberal Democrats and conservative and moderate Democrats favored compromise, even if it resulted in a budget they disagreed with. But Republicans were divided: Most Tea Party Republicans wanted lawmakers to stand on principle, even if it resulted in a government shutdown; other Republicans favored compromise.