On Wednesday Wall Street multi-billionaire Peter G. Peterson, who has pledged to spend a billion dollars to panic Americans about deficits in order to get them to slash Social Security and Medicare, is conducting a "Fiscal Summit" in Washington featuring many of the very people who created the deficits Peterson decries.
This summit is designed to stampede President Obama's new deficit commission (which meets the day before - on Tuesday - for the first time) into adopting their version of fiscal austerity.
At 3:30 on Tuesday, I will moderate a press conference, featuring Robert Kuttner, Heidi Hartmann and Dean Baker, designed to present a counter to Peterson's simplistic explanations and dangerous proposals - and to warn the White House that having the two co-chairs of the Obama deficit commission participate in Peterson's extravaganza will discredit the already dubious White House claim to be examining all the paths to fiscal sustainability.
But Americans looking for jobs and economic recovery are not likely to be persuaded by the bizarre collection of speakers Peterson has assembled.
The Bush tax cuts for the very wealthy were the first cause of soaring US deficits after Democrats cleaned up the red ink of the Reagan years. So who are Peterson's headliners? Alan Greenspan, former Fed Chairman, who famously assured Congress that those deficit-creating tax cuts were OK - and who was recently forced to admit that his conservative blinders prevented him from seeing and acting to avoid the housing bubble and the deficit-creating economic crash that resulted. Other speakers, like Congressmen Judd Gregg and Paul Ryan, supported the Bush tax cuts. And Peterson himself, who benefitted hugely from the Bush tax changes, never seriously protested those irresponsible deficit-creating policies.
Also speaking: Robert Rubin, who as Clinton's Treasury Secretary, presided over the deregulation of Wall Street financial giants, and then as CitiBank chairman, presided over the orgy of speculation and outright fraud (all enabled by his Treasury policies) that brought the financial system crashing down.
The chutzpa of this Peterson "fiscal summit" is just breathtaking.
Wall Street billionaires who helped Bush blow a whole in the federal budget - and who also actively enabled the financial deregulation and speculation that created today's economic crisis and deficits - are gathering (at the Ronald Reagan building!) to lecture senior citizens and the rest of us about the need to tighten our belts and allow them to slash Social Security and Medicare.
This billionaires' bash might seem comical - Saturday Night Live couldn't do justice to it - except for the fact that the organizers have massive resources at their disposal and they are deadly serious.
For one thing, they are trying to sabotage all further efforts to stimulate a stronger economic recovery. And it is pretty clear that they have had an impact on the Obama administration, which seems to be giving up pushing for significant new aid to the states or job creation, like Rep. George Miller's Local Jobs For America Act.
Under pressure from these conservatives, President Obama is on the verge of pivoting to the deficit, not jobs creation, as we go into the election season. That would be disastrous, both economically and politically - as Americans who watched the bank bailouts, continue to look for a jobs recovery.
Even more disastrous would be for Democrats to embrace Peterson's deficit "solutions." He wants the country (and Obama's commission) to cut Social Security benefits, even though Social Security contributes nothing to the deficit. And he wants us to cut Medicare benefits (or turn Medicare into a voucher program, as White House commission member Representative Paul Ryan would do). This after President Obama has just successfully made the case that the target for deficit reduction should be overall health care costs, not Medicare.
President Obama, who has rightly blamed Bush economic policies and the current financial crisis for the growing deficit, should not follow Peterson advice on health care, on "entitlements," or on jobs and economic stimulus. And he should make sure that his deficit commission co-chairs, Erskine Bowles and Alan Simpson (and three other members of the White House commission) who are speaking at the Peterson conservative extravaganza, are exposed to a more progressive point of view.
It really does look bad - just as the White House is warning more progressive members of the Obama Commission to hold off on publicly talking about the commission's work - to allow the two co-chairs to attack senior organizations (as Simpson has, since being named) and to declare that Social Security and Medicare have to be cut (as Bowles recently did) and then to participate in this Peterson "summit" so obviously meant to push the White House in a conservative direction.
But wait, there's more: the White House appears to be using a self-described "independent, non-partisan" group, called America Speaks to carry out what appears to be an "astro-turf" campaign to simulate public discussion of these issues. Heads up, folks. They announce on their website:
On June 26, 2010, thousands of Americans, in hundreds of locations across the United States and online, will weigh-in on strategies to ensure a strong economic recovery and a sustainable fiscal future.
Sounds like a cool, grassroots, online democracy kind of project - until you read further and find one of their big funders: the Peter G. Peterson Foundation. He is everywhere, manipulating the debate about our future!
Get ready for a fight, friends. The whole dynamic reminds me of the early 1998 period during which President Clinton issued his call for a nationwide series of town-hall forums to discuss the long-range future of the Social Security program. Those official White House forums gave half their program to people who wanted to privatize Social Security - and Vice President Al Gore's bold declaration at one of these events that the White House was ready to "seize the third rail of American politics" greatly confused people, especially seniors, who wondered whether he and the President, and Democrats in general, might be willing to compromise with the enemies of Social Security.
Our efforts to turn around Clinton eventually grew into a powerful coalition that defeated George Bush's privatization plan, but first we had to spend way too much time convincing Democrats that standing up for Social Security and Medicare was both good policy and good politics.
Get ready for another great debate - this time about the future of good jobs, secure retirement, and conservative austerity versus the raising of public revenues to finance investment in the next generation of sustainable economic growth. We know we will be up against the well-funded Peterson conservatives. Let's work to make sure the Obama White House is on our side.
Follow Roger Hickey on Twitter: www.twitter.com/rogerhickey
My reaction is -- has the tea party taken over America? Who talks about the deficit beside millionaires and their tea bagging protectors? The top 5% may own half the wealth (I believe) but they do not own half the votes. Why are they being catered to?
My biggest fear is that if the White House comes to support these cuts, even self-identified liberals will remain silent so as not to criticize a Democratic President... I hope not. I hope it is just a way for the President to say to Republicans-- I'm working on the deficit but Congress is not co-operating with the Commission's recommendations... I just don't understand the WH strategy on this
THIS IS CLASS WARFARE IT'S TIME TO FIGHT BACK AMERICA!
http://www.fiscalsustainability.org/
http://www.fiscalsustainability.org/
This is a true grass-roots response to Peterson's jihad against the middle class. Citizens and economists the world over are rising up and challenging the stale, dysfunctional, inaccurate, and catastrophic economic theories and plans as laid out by the Peterson foundation and his opulently funded propaganda. Investigate, Invest, and get Involved!!!
http://www.alternet.org/story/146183/obama_packs_debt_commission_with_social_security_looters?page=entire
A truly frightening lineup of wealthy conservatives, all wielding axes.
If we spirits hath offended .. .
I went back and read some of your recent posts and have obviously gotten wires crossed. I am not a "troll" and found our views in sympathy enough that I've fanned you. In my defense, I did not spell Peterson as S O R O S. I've been following Mr. Peterson around for longer than I care to remember and he's been unidirectionally devoted to cutting SS for at least twenty years without addressing the necessity for his kind to take the like haircut. Sort of like the guy who always shows to drink from other people's cellar, but never throws a party so that we may drink from his. Yes, I know THEY "need" the military - but if Conservatives are unable to release the military budget to scrutiny and dimunition, it won't matter (for the economy as a whole) how much money they peal out of SS. They will have made even more lives unbearable and only deferred our problems, not solved them.
Again, I apologize for offending you. It was inadvertently done so.
We deserve to see the math regarding the economic stimulus that full Social Security will provide to younger generations. The alternative is to ask them to take in their elders while trying to raise their families. People deserve to see this laid out starkly.
As my husband and I gained ground, the day came that we saw statistics place us in the top 10%, even the top 5%. Our net worth is statistically in the upper percentile. We have landed squarely at the bottom of the top of the heap. By many measures, we are rich. But we aren't rich. By every guide, we barely have enough to retire, unless SS is there for us. We live modestly, as we always have. Our relative prudence before the meltdown lost us only 5%, but outrageous property tax increases may still force us from our home of 25 years. If we are rich, then I fear deeply for the rest. We will be fine, come what may, because we will revert to fallback positions, but that is a luxury denied to most. Do what you will to me, but do not allow the destruction of this safety net for your children.
Due to some system conversion I was unable to respond to your rely here as I wanted. I'm further up the comment stream. I hope you take my apology and explanation to heart. We have too much in common to fall out amongst ourselves. I have indeed fanned you.
It could be a brilliant move for the Republicans. If in fact the Peterson's of the commission are able to manipulate a change of the entitlements that are not good for Americans, then it will make Obama look bad and make the Republicans look good. Because the change would have happened on Obama's watch. Already my 85 yr. old mother thinks McCain is fighting to save medicare.
I do hope Obama knows what he is doing with the commission.
On the other hand, it could be good for Obama because it would be a simple up or down vote for or against entitlements. And we could see exactly who votes for what.
I am very nervous about the commission.
The Galbraith perspective on the situation is enlightening:
"The Fiscal Sustainability Teach-In Counter Conference will be the important event in Washington on April 28. Unlike the other meeting, this one will feature important work by honest scholars. It deserves at least equal attention, and very much more respect."
--- James K. Galbraith, The University of Texas at Austin. [April 19, 2010 via email with permission to the organizers of http://www.fiscalsustainability.org/ ]
Find out more here:
http://neweconomicperspectives.blogspot.com/2010/04/little-help-from-our-friends.html
And here:
http://bilbo.economicoutlook.net/blog/?p=9311
The Democrats should uncap FICA income levels and tell the right wingers to take a hike.