Amid all the nonsense and gobbledegook that has been written about banking industry and about the economic slump during the last four years of the global financial crisis, New York Times reporter Gretchen Morgenson has stood out both for the clarity of her analysis, and for her willingness to go after the guilty parties in the political and especially the banking system, naming names and calling it as she sees it.
So it was kind of disappointing--even shocking--to read her latest article reporting on a new “study” by Peterson Institute for International Economics Senior Fellow Joseph Gagnon, warning about the nation’s growing debt crisis.
The Peterson Institute, founded by Wall Street tycoon Peter Peterson, has long been gunning for the Social Security and Medicare systems, which he, and the rest of the Wall Street gang, see as unfairly competing with Wall Street for the assets of the public, and as destructive of the “free market.”
Peterson’s basic schtick is that the two critical support systems for the elderly and infirm are going to bankrupt the country as they pay out benefits that exceed what retirees paid into the system, and that the solution is to cut back on those benefits, increase the taxes collected, or better, to privatize both systems.
Given Peterson’s and his institute’s long-standing agenda to gut Social Security and Medicare, it’s not surprising that Gagnon, as a fellow there, would say the solution to the nation’s growing debt is to either raise taxes or cut those two hugely successful, critically important and broadly popular social programs.
Morgenson is too smart not to know better, and yet not once in her article did she look outside of Gagnon’s narrow definition of the problem at the real cause of the national debt: the country’s outlandish military budget and a decade of unfunded wars, which have been piling up debt at a rate of some $150 billion a year (and that’s just the principal!).
After all, the country has been piling up this debt for several decades, and especially over the last decade, but during all this time, Social Security and Medicare have been paying out their benefits from current dedicated payroll taxes and by drawing on the trust funds that had built up because of the years that more was being collected than paid out in benefits.
Get the point? Nobody, including Gagnon, Morgenson or the Social Security and Medicare-hating members of Congress like Rep. Paul Ryan (R-WI), will acknowledge the fact that not one dime of the huge US deficit has been caused by a benefit check paid by Social Security, and the only parts of Medicare that are funded by general tax revenues are doctors bills and the prescription drug benefit--Medicare Part D--a lousy measure promoted by President George W. Bush and the Republicans in Congress which bars the government from negotiating discounts from the Pharmaceutical companies--a problem easily fixed by improved legislation.
It’s the wars, stupid!
If the US would just cut its military spending down to size, instead of spending as much as the rest of the world combined on war or preparing for war--say by 75%--it would free up more than $450 billion a year that could go towards funding things like improved education, research into alternative energy, improving health care access, and paying down the deficit, too. Toss in cuts in the outsized $40+ billion annual secret intelligence budget, in the nation’s obsolete and dangerous nuclear weapons program and other ancillary military-related expenditures, and we’re talking about saving half a trillion dollars a year!
Morgenson should be ashamed at carrying water for the likes of Peterson and Gagnon.
This being Memorial Day weekend, she could at least make an attempt to restore her once sterling but now sullied reputation as an uncompromising financial journalist by taking on the Pentagon.