Over the past couple of weeks, it's become apparent to me and many others that this entire showdown is not over Obamacare. The ACA is a convenient patsy because it is new, untested, and they've managed to poison public opinion around it over the past three years.
The real target is Social Security and Medicare. From a political standpoint, waging a war using those programs as hostage would be so wildly unpopular no sane or insane politician would dare choose that route. And so Obamacare has become the convenient stand-in, a cardboard stand-in for their real goals.
As Diane noted in her post here, the New York Times published an exposé showing how this strategy formed over the months since Barack Obama's re-election. As usual, it was financed and formed by the Kochs and their right-wing partners. But the Kochs are hardly the only players in this particular round of attacks.
I must have been a bit hard of hearing while watching you this past week on FoxNews Sunday—the hard of hearing being the key Fox demographic, after all—but I think I heard you say that Social Security in the United States "is going to run out of money in 20 years," so you want to "fix it now." I couldn't have heard that right, could I have? Let me try "The Google," as wily former President W. Bush once counseled.
Ok, Dick, I just consulted the transcript, and, sadly, I didn't hear it wrong. So it seems we need to have a bit of an awkward conversation.
First, my friend (I still like to think of you this way, as you're usually such a staunch supporter of common-sense positions on key issues), surely you must be aware that you misspoke?
In fact, upon completing an online search on the Internet machine, you'll see that if we do nothing, Social Security is solvent through 2037, 2033 worst-case scenario, or 20 years, just as you said! But here's the problem. In 20-24 years, Social Security will not, "run out of money." In fact, at that point, it will still pay 78 percent of its benefits, or roughly 78 percent more than you calculated. Not a small difference, no?
So why, either on a policy or political level, would you even think of cutting Social Security right now?
Let's begin on the policy side.
As we've discussed, Social Security (as my friends I've worked with at Social Security Works can show you in detail), pays full benefits for at least 20 years. The way forward would be to raise, or even completely eliminate the regressive cap (Scrap The Cap! Say it with me, Dick!) on the amount of income subject to Social Security payroll taxes. Currently, it's at $113,700 a year, also known as approximately 1percent of Mitt Romney's income, or the cost of two Mitt-sized car elevators. If you were to scrap this cap, Social Security would continue ad infinitum, or at least until our ape overlords rule the planet.
In fact, as a refresher, your colleague Senator Tom Harken of Iowa proposed just such legislation, The Strengthening Social Security Act of 2013. It would phase out this cap, and provide increased benefits, not cut them!
Pretty groovy, huh?
Hell, let's just say you didn't want to completely scrap it, but apply it to 90 percent of income (currently it covers about 84 percent) like it did in the days of St. Reagan, King of The Welfare Queens. Raise the cap to $200,000, and poof, we get $100 billion more by 2030!
This Sunday's episode of 60 Minutes was a brilliant case study in the media's ability to manipulate the public mind. The entire hour is worth studying, if only as one of the most illuminating and sophisticated examples of media manipulation in recent memory.
Who, What, When, Where ...
The most important editorial decision may not be how to cover a story, but which stories will be covered at all. But once a story is assigned, however that happens, the journalist's responsibility is to inform readers - or the audience - of its meaning and context.
60 Minutes failed both tests.
The old journalistic maximum said a good journalist had to answer five questions in every story: Who, what, when, where, and why? Of those, "why" is the most important questions of all. Without it, stories are more likely to misinform than inform.
In this case, the misinformation seems deliberate. The intended message seems to be government can't help us. We must militarize or cities and depend on the generosity of billionaires, or we don't stand a chance.
... and Why
Three stories were aired Sunday night: Counterinsurgency Cops,Robin Hood, and Invisible Wounds. The first two pieces advanced the anti-government billionaires' agenda with almost Orwellian efficiency. The third was less driven by that agenda, although it also reflected the biases which big-money interests have built into the institutions of journalism and politics.
Counterinsurgency Cops covered, as the name suggests, the adoption of military counterinsurgency techniques by urban police forces. It's a controversial topic: Do we really want our cities subjected to the same occupation-style military tactics as neighborhoods in Kandahar and Mazal-i-Sharif? One might expect both sides of the argument to be covered in a story like this.
There's definitely a lot of bull around global austerity, but it isn't coming from our side of the fence. You know who really, really loves Reinhart and Rogoff and the BS study they did where they "forgot" certain key pieces of data? You'll never guess!
That's right, our old friend Pete Peterson. PRWatch, with all the gory details:
As the Center for Media and Democracy detailed in the online report, "The Peterson Pyramid," the Blackstone billionaire turned philanthropist has spent half a billion dollars to promote this chorus of calamity. Through the Peter G. Peterson Foundation, Peterson has funded practically every think tank and non-profit that works on deficit- and debt-related issues, including his latest astroturf supergroup, "Fix the Debt," which has set a July 4, 2013 deadline for securing an austerity budget.
Reinhart, described glowingly by the New York Times as "the most influential female economist in the world," was a Senior Fellow at the Peterson Institute for International Economics founded, chaired, and funded by Peterson. Reinhart is listed as participating in many Peterson Institute events, such as their 2012 fiscal summit along with Paul Ryan, Alan Simpson, and Tim Geithner, and numerous other Peterson lectures and events available on YouTube.She is married to economist and author Vincent Reinhart, who does similar work for the American Enterprise Institute, also funded by the Peterson Foundation.
Who else funds AEI? Oh, I know! David and Charles Koch! They give millions to AEI each year, as does the DeVos family, and the rest of the billionaire cadre.
Kenneth Rogoff is listed on the Advisory Board of the Peterson Institute. The Peterson Institute bankrolledand published a 2011 Rogoff-Reinhart book-length collaboration, "A Decade of Debt," where the authors apparently used the same flawed data to reach many of the same conclusions and warn ominously of a "debt burden" stretching into 2017 that "will weigh heavily on the public policy agenda of numerous advanced economies and global financial markets for some time to come." (Note that not everyone associated with the Institute touts the Peterson party line.)
While all eyes have been fixed on Boston and West, Texas this week, Simpson and Bowles have been skulking around Congress trying to revive their austerity agenda with revised numbers for a 'deal'. Flushed with the realization that their primary foundation has washed away in a tidal wave of flawed scholarship, they're now resorting to saying it's just 'common sense' dictating the need to reduce spending. No deal, boys. Give it up.
Meanwhile, over on the Obamacare aisle, the Club for Growth has parted ways with Eric Cantor about including funding for pre-existing condition insurance pools in the budget because we just can't afford it, they say. Cantor is pimping it because he thinks it's an 'alternative' that could justify getting a repeal of Obamacare before the effective date in favor of these high-risk pools. Cantor and the Club for Growth can suck their shoes for all I care. Just leave Obamacare alone, boys.
The austerians are beginning to realize they've lost their footing in this debate. Time to step up and keep reinforcing the truth -- austerity harms the economy. It is no help at all to anyone other than possibly billionaires who want to have it all as the serfs grovel for their crumbs.
True confession: When I first started writing this post, I was willing to give the president and his advisors the benefit of the doubt. As I dug deeper and listened more carefully, I realized Ezra Klein's carefully crafted justifications for cutting Social Security made absolutely no sense politically or policy-wise.
It makes almost no dent in the deficit or debt now or in the future.
It takes from those who can least afford it.
It relies on the false premise that Social Security is somehow compromised or bankrupt, neither of which are true.
Chained CPI also has an impact on tax preferences and Medicare benefit payment schedules to providers, so it is ostensibly a way to slow the growth of tax preference items and Medicare costs. While it's important to contain those costs, chained CPI is the gnat straining at an elephant. There is no unbendable law that says chained CPI can't be used for tax preferences without linking Social Security benefits.
All of that leaves this Obama supporter confused about what possible reason he could have for including this in the White House budget proposal, particularly when he campaigned on protecting Social Security and Medicare.
According to Politicothe purpose of the offer was to resolve the budget battles and move on to other pressing agenda items, like immigration and guns and pre-K for all. If that's the case, then someone should have clued this unnamed "Obama aide" in:
“We’re not going to have the White House forever, folks. If he doesn’t do this, Paul Ryan is going to do it for us in a few years,” said a longtime Obama aide, referring to the 2012 Republican vice presidential candidate who proposed a sweeping overhaul of Medicare that would replace some benefits with vouchers.
We've written many, many times about Fix the Debt's backers and the billionaires who created it along with the false flag over the debt, and now The Nation has dedicated an entire issue to this astroturf organization.
Behind this strategy are no fewer than 127 CEOs and even more “statesmen” pushing for a “grand bargain” to draw up an austerity budget by July 4. With many firms kicking in $1 million each on top of Peterson’s $5 million in seed money, this latest incarnation of the Peterson message machine must be taken seriously.
Fix the Debt has hired such powerful PR firms and lobby shops as the DCI Group, the Glover Park Group, the Dewey Square Group and Proof Integrated Communications, a unit of the PR firm Burson-Marsteller, which was the go-to firm for Big Tobacco. In the run-up to the “fiscal cliff,” these firms launched a flashy $3 million media campaign, blanketing Capitol Hill with TV, Internet, Metro and newspaper ads featuring slogans like “Got Debt?” and “Just Fix It.”
Fix the Debt’s stable of CEOs are a PR flack’s dream. Not only are they able to get meetings with everyone from John Boehner to President Obama; they can flood cable news with laughable messages of “shared sacrifice” and be treated with fawning respect. Fix the Debt’s David Cote, CEO of Honeywell, “brings serious financial muscle to the table” when he pushes “market credible solutions,” chirps The Wall Street Journal. There is no mention that Cote is a tax-dodging, pension-skimping hypocrite: Honeywell has a negative average tax rate of -0.7 percent and underfunds its employee pensions by -$2.8 billion, making Cote’s workers even more reliant on Social Security.
Creating a crisis is key. “America is more than $16 trillion in debt,” Fix the Debt’s website warns, calling it “a catastrophic threat to our security and economy.” The CEOs echo this warning, writing to Congress of the “serious threat to the economic well-being and security of the United States.”
As billionaires go, Pete Peterson is certainly not one of the wingnut billionaires by any stretch. But if our criteria for evaluating philanthropy is wingnuttery, we're surely lost in a vortex of our own making. Start with this: Peter G. Peterson was a Republican, just like his pal Mike Bloomberg. Not just any Republican, either. A Republican who served under Richard Nixon. And now he is a deficit hawk, which means his efforts support the right wing effort to undermine social insurance while lifting up corporate interests.
The 63 Fix the Debt companies that are publicly held stand to gain as much as $134 billion in windfalls if Congress approves one of their main proposals — a “territorial tax system.” Under this system, companies would not have to pay U.S. federal income taxes on foreign earnings when they bring the profits back to the United States.
The CEOs backing Fix the Debt personally received a combined total of $41 million in savings last year thanks to the Bush-era tax cuts. The top CEO beneficiary of the Bush tax cuts in 2011, Leon Black of Apollo Global Management, saved $9.9 million on the Bush tax cuts. The private equity fund leader reaped $215 million in taxable income last year just from vested stock.
Of the 63 Fix the Debt CEOs at publicly held firms, 24 received more in compensation last year than their corporations paid in federal corporate income taxes. All but six of these firms reported U.S. profits last year.
So you see, the "Fix the Debt" effort isn't quite as non/bi-partisan as you might think, nor is it intended to serve progressive interests. But wait, there's more:
So this is the group who is calling for Social Security checks to be reduced and Medicare eligibility age to be moved up to age 67. A group of people who think our national debt is so serious, so utterly doom-ridden, they're fearmongering even while they set up their fat pensions and healthcare plans for themselves.
Oregon Rep. Peter DeFazio explains the chained CGI and why it's a really bad idea.
Here's what I think of all this crap about "shared sacrifice" and "skin in the game": We already have so much damned skin in the game, we're flayed.
And to us, it's not a game.
We're the people who lost our jobs, our savings, our healthcare, our home equity (and in many cases, our homes). Our public and private pensions have been pillaged, and for far too many of us, all we have left is Social Security and Medicare.
What are we willing to put on the table? Frankly, not another damned thing. Why should we? We're not the millionaires and billionaires who are doing so well. We're not the bankers who crashed the economy and walked off scot-free and richer than ever.
Here's what we're willing to contribute to the negotiations: We promise not to go after the bankers with pitchforks. That's a great deal, they should take it.
"Why not cut Social Security?"
"It's not a cut," they say. Really? What would you call it if a Republican president was trying to impose this on us? This is a solution in search of a problem.
I am so thoroughly disgusted by the charade of what's going on. Nancy Pelosi is saying the chained Consumer Price Index will contribute to the "strengthening" of Social Security. Sure it will -- in the same sense that Bush's Blue Skies act stopped air pollution, I guess. If it will indeed strengthen Social Security, why is the White House pretending that the Republicans are forcing them into it? What's the part, then, that Pelosi says she's "not crazy about"?
Our democracy is now so perverted that our "leaders" no longer bother to pay us the compliment of wooing us to support what they propose. Instead, they hide behind the skirts of deeply dishonest ploys like the chained CPI. This is the coward's cut -- it hurts the most vulnerable, and pretends to be a tweak.
Oh, and it raises taxes on those who make less than $40,000 a year.
Once again: What does Social Security have to do with the deficit? That's it in a nutshell. You don't have to argue against people who insist changing the COLA formula to one that doesn't count heating oil or healthcare costs is an accurate reflection of the elderly's expenses. All you have to do is get an answer to that question: Why are we cutting Social Security when it has nothing to do with the deficit?
We are talking about elderly people dying because they won't have enough money to turn the heat up. In a nation where we "lost" several billion dollars in cash in Iraq, is this a rational or humane discussion?
And all this is President Obama's response to an election in which he claimed that he would "protect" Social Security and Medicare. He used weasel words that fooled people. But what he's doing now is so cynical, so manipulative, that if he gets away with it, he will cause real harm to the very idea of democracy.
And why is the president is only pushing for a two-year extension on the debt ceiling? You don't suppose it's because he'll have another lame duck session and can go back for the cuts he couldn't get the first time, would it?
The thing that kept Social Security safe and sound for so many years is that politicians were afraid to touch it. When a Democratic president not only accepts, but encourages cuts in one of the crown jewels of Democratic policy, how much easier will it be to hack away at it in administrations to come? It will never be safe again. We will have to fight this same fight every year, and all they'll have to do is point to President Obama.
You need to call. If you've already called, call again. This is our only chance to scare our elected officials into representing us - for a change.
The Capitol Switchboard number is 202-224-3121. The White House number is 202-456-1414.You can sign a petition here. But it is going to take people doing more. Make sure your parents, grandparents, and everyone else you know does something. Talk to people at work and at church and everywhere you go. Join up with groups that are fighting the battle like MoveOn and Working America. Show up at your congressperson’s office and let them know what you think. Organize a picket outside that congressional office. Do not hold anything back if you care about this issue. And maybe, just maybe, if enough of us raise some hell, this train headed down the track to cutting Social Security benefits, to taking money out of the hands of vulnerable innocents who had nothing to do with the deficits, will be forced to stop.
No wonder conservatives hate public education. It makes it so damn easy to see what they're up to when you know how to do simple arithmetic. Imagine having the audacity to say Social Security is too generous when you're pillaging your own employee pension fund. They're pretty consistent that way! With Pete Peterson behind them, all they have to do is show up and say their lines, and in exchange, Peterson will fund ALEC's legislative wish list. Corporate synergy!
The CEOs' employees are much less secure in their retirement than the CEOs. According to the report, less than 60 percent of the 71 public companies offer pension plans for their employees. Of the 41 companies that do, 39 of them haven't contributed enough to their workers' pension funds to enable the plans to pay out their anticipated obligations. Among the companies with employee pension funds in the red, these deficits exceed $100 billion.
The CEOs are among 71 chief executives of publicly traded companies who belong to the Fiscal Leadership Council of the influential Campaign to Fix the Debt, a group which has raised more than $60 million to lobby for a debt deal driven by cuts to "entitlements." The coalition will meet Wednesday morning with congressional leaders, according to sources familiar with the group's lobbying activities. The group, funded in part by former private equity magnate Peter G. Peterson's foundation, has pledged to push for austerity during the lame duck congressional session, and beyond. Peterson has spent nearly half a billion dollars in recent years pushing his austerity agenda.
As the debate heats up over whether to cut Medicare, Social Security or Medicaid in order to maintain federal spending and corporate tax breaks, companies with well-compensated CEOs who preside over underfunded employee pension funds invite a new round of questions about the motives, and methods, of the CEOs pressuring Congress and the White House to cut programs for the middle class.
Yes, I think you could question their motives!
The companies in arrears on their pension funds include defense giant Boeing, which paid CEO Jim McNerney $23 million last year; Honeywell, where CEO Dave Cote earned more than $55 million in compensation in 2011; and AT&T, which docked CEO Randall Stephenson's pay by $2 million last year after he orchestrated a failed takeover of T-Mobile. The $2 million penalty meant that Stephenson made only $22 million total that year, as opposed to the $24 million he would otherwise have been paid.
Boeing, Honeywell, and AT&T represent just three of the dozen companies who are cited in the IPS report as having CEOs with individual retirement assets totaling more than $20 million each, despite the fact that their companies have underfunded pension funds for their employees.
If each of these 12 CEOs were to convert his retirement accounts into annuities at age 65, the report shows each would receive a monthly check for at least $110,000 for life. By contrast, the average montly Social Security payment was $1,237 in October. Still, the CEOs argue that Social Security benefits are too generous.
So Erskine Bowles, an alleged Democrat/Wall Street lackey who's rumored to be Obama's choice to replace Tim Geithner, is endorsing a New Hampshire Republican against a progressive Dem so there'll be one more vote in favor of the beloved Grand Bargain. But it doesn't stop there: Pete Peterson is pouring millions into post-election advertising for a lame-duck deal. Gee, I can't wait:
WASHINGTON -- Billionaire private equity mogul Peter Peterson is investing millions of dollars in a new Washington-based campaign for austerity, planning to blanket the airwaves after the election to bolster the case for a "grand bargain" in Congress' lame-duck session that would slash Medicare and Social Security spending in exchange for new tax revenue.
The new Campaign to Fix the Debt is chaired by former Pennsylvania Gov. Ed Rendell, a Democrat, and former New Hampshire Sen. Judd Gregg, a Republican. It's priming for lame-duck negotiations over the expirations of the payroll tax cut and the Bush tax cuts, as well as scheduled cuts to defense and non-defense spending.
Peterson's allies aren't waiting for the election, however. In New Hampshire, the co-chairmen of the 2010 Simpson-Bowles commission -- former GOP Sen. Alan Simpson and former Clinton White House official Erskine Bowles -- have endorsed incumbent Republican Rep. Charlie Bass, who supported a budget bill with many of their austerity recommendations, over progressive Democrat Annie Kuster. Bowles and Simpson have become fashionable politically, so Bass is taking full advantage of their endorsement, running full-page ads in newspapers across the state.
Kuster, who lost a squeaker to Bass in 2010, has hit back hard. "Let me be clear: I will never cut Social Security and Medicare benefits. My Tea Party opponent will," she said in a statement.
But it will take more than Annie Kuster to stave off the coming campaign to cut federal spending. The two parties have been in budget talks for the better part of two years, and Bob Woodward's new book, "The Price of Politics," portrays a president obsessed with getting a "big deal." President Barack Obama was ready before to agree to dramatic cuts, including to Social Security and Medicare, in exchange for new taxes, but Republicans ultimately refused to yield.
Except with us. Like most Wall St. billionaires, he just can't stand the thought of workers having dignity in their old age -- especially when he and his buddies want to get their hands on that Social Security money. He's pouring massive amounts of money into persuading us otherwise, and he's already bought off most of the politicians.
Don't fall for it.
P.S. You can donate to Annie Kuster's Blue America page here.