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Protestors rally against Social Security cuts on December 10, 2012 in Doral, Florida. (Photo: Joe Raedle/Getty Images)

The Peterson Billionaire Clique Is Back for Your Social Security

If the Budget Committee listens to them, it could mean disaster for millions of Social Security recipients.

Richard Eskow

"Hold for Peter G. Peterson."

Legendary financial journalist William Greider was unaccustomed to receiving a phone call and then being told to wait. But Pete Peterson was a billionaire, a former cabinet secretary under Richard Nixon, and a man accustomed to getting his way. Peterson spent decades financing efforts to reduce government spending, with a special interest in cutting Social Security and Medicare.

"Bill," boomed the voice from the other end of the line, "Pete Peterson here. You know, Bill, we have a lot in common."

"No, we don't," Greider said as he hung up. 

Influence Man

That was not the response Peterson usually got from journalists or politicians, whom he carefully cultivated (and sometimes financed) in pursuit of his anti-government agenda. Greider was one of the few journalists who regularly documented and exposed Peterson's efforts. He was perhaps the only journalist to ever hang up on Pete Peterson. I shared an office with Greider, who gleefully told the story to his colleagues afterward.

They assume a "responsible" federal budget is one that limits deficit spending, even if it costs human lives and makes budgeting harder for real families sitting around real tables.

Peterson spent a reported half billion dollars trying to convince the public that government deficits were a greater crisis than, say, the country's epidemics of poverty and needless deaths. Peterson's associates and front organizations like the Committee for a Responsible Federal Budget (CRFB) presented a series of false choices to the public under the guise of making "tough choices," listing all the options under the guise of impartiality while carefully slanting their arguments in favor of less spending and against higher taxes.

In other words, they acted in the interests of billionaires like Peterson, and against those of virtually everyone else.

The underlying question was not even, Are you concerned about government deficits? Even under the most conservative economic models, the Peterson machine's presentations are inevitably biased. Nevertheless, reporters ate up the prepackaged story lines and 'facts,' while politicians ate up the campaign contributions. 

For decades, the Peterson crowd reigned supreme in Washington policy circles. Then, in recent years, the "deficit hawk" mentality seemed to lose its clout. Under Donald Trump, Republicans engaged in a deficit spending spree on an unprecedented scale. Joe Biden came into office with a $3.5 trillion spending plan.

Now, the Peterson crowd has returned for your Social Security.

As if to celebrate their revival, Republicans are giving CRFB director Maya MacGuineas a prominent seat at the Senate Budget Committee's hearing this Thursday on expanding Social Security. (The official title of the hearing, under Committee chair Sen. Bernie Sanders, is "Saving Social Security: Expanding Benefits and Demanding the Wealthy Pay Their Fair Share or Cutting Benefits and Increasing Retirement Anxiety.")

It's time to talk about the Peterson crowd's ideology.

Table Talk

A favored rhetorical gambit among Peterson's friends and allies is the "federal government as home" metaphor. The Clinton Administration used it in its 1996 "Citizens Guide to the Federal Budget":

"In a typical American household, a father and mother might sit around the kitchen table to review the family budget. They might discuss how much they earn each year and, in turn, how much they can spend on food, shelter, clothing, and perhaps a vacation ...They might discuss whether to spend less, such as by cutting back on restaurants, movies, or other entertainment. Or they might borrow. In a sense, the Federal Government plans its budget much the same way."

The Obama Administration adopted the theme in 2011 when budget director Jacob Lew told reporters: "We're doing what every family does when it sits around its kitchen table. We're making the choice about what do we need for the future."

This rhetorical tone—familiar, informal, condescending—is a mainstay of Peterson-ism. Robert Bixby, then the Executive Director of the Peterson-funded Concord Coalition, is glowingly described this way in the anti-deficit book (also a film) I.O.U.S.A:

"In an effort to explain the budget in an easily understandable way, Bixby uses metaphors that resonate with the average American. First, he likens a budget to going on a diet ... Next, he likens the budget committee to a family meeting ... like Mom and Dad sitting at the kitchen table at the beginning of the year, figuring out what the family can afford."

Economists differ about the role government deficits play in the larger economy, but no serious economist would argue that the budget of a sovereign nation—with its own currency and the ability to levy taxes—is comparable to that of a family. (And few families would balance their budgets by denying food or sustenance to older family members.)

3,000 Tweets from a Hawk

The CRFB's veneer of neutrality is perhaps the thinnest when it comes to taxing the rich. Their websites are always careful to mention taxation as an option. But I analyzed 3,201 tweets from the group during the Build Back Better debates of last year and found no mention of a wealth tax or taxes on high-income earners—even though billionaires had amassed more than $1.8 trillion in new wealth since the pandemic began.

The CRFB did resist Democratic proposals to raise the cap on so-called SALT (state and local tax) deductions. That would disproportionately benefit higher-income earners, as the group claims, but would only negligibly help the extremely wealthy. It also gave lip service to changes in capital gains taxation and has noted that other tax changes, like increasing the top marginal tax rate, would reduce the deficit. But it hasn't pushed very hard for them. 

Beyond SALT, a search for the word "billionaires" only revealed one fawning tweet to Elon Musk. Musk, who had already gained in $150 billion in pandemic wealth by that time, and reportedly paid no taxes in 2018, tweeted in October 2021 that

"US national debt is ~$28,900 billion or ~$229k per taxpayer. Even taxing all 'billionaires' at 100% would only make a small dent in that number, so obviously the rest must come from the general public. This is basic math."

In addition to betraying a lack of economic understanding (and enclosing the word 'billionaires' in quotes for no discernable reason), Musk concluded that "spending is the real problem." The CRFB, is usually careful to sound neutral about spending vs. revenue, took the bait, tweeting:

"Hey @ElonMusk you're right. Fixing our debt will require tough tradeoffs and can't be done with taxes on billionaires alone. We'd love to work with you to help policymakers understand."

Playing with Your Security

The Peterson network has a long history of oddball (that is to say, lame) PR campaigns. These include bus tours, shadow organizations, made-up games, and interactive websites, using names like "Budgetball" and "The Can Kicks Back." Today, visitors to the CRFB website can "play" (their words) "Boomers vs. Zoomers," which pits generations against one another for federal resources and asks, "How would you allocate the federal budget between generations?" CRFB is closely allied with retired senator Alan Simpson, who called seniors "greedy geezers," and its "game" quickly makes its feelings known. "Seniors are doing pretty well," it claims.

(The National Center for Retirement Research at Boston College found that "even if households work to age 65 and annuitize all their financial assets, including the receipts from reverse mortgages on their homes, roughly half of households are at risk" of a serious decline in living standards.)

"Allocat(ing) the federal budget between generations" is something of a "Sophie's Choice" question, since both groups are facing deep economic and health challenges. It's also a good example of the group's rhetorical gamesmanship, which often poses false choices while eliding the real issues: Why should we have to choose between generations at all? Why should we make seniors responsible for child poverty that's caused by economic inequality, the decline of the middle class, and other forces that don't involve seniors?

Similarly, the group's interactive "Debt Fixer" lets "you" choose from pre-selected options to achieve the stated goals of stabilizing federal debt at 90 percent of the economy by 2031. "$5,520 billion to go," it tells you as you begin.

Another interactive test allows users to find their "budget personality." It concluded I was a "Big Spender," adding somewhat censoriously that "future generations will need to figure out how to handle the high debt left to them."

The website also offers "The Reformer: An Interactive Tool to Fix Social Security," warning users that "Social Security remains insolvent. The trust fund will run out in 2034 at which point all beneficiaries will face a sudden 22% benefit cut." They surely know that this is not true, because Congress would never make that political mistake. (By their logic, the US military will be insolvent and bankrupt in 2023 because Congress has not yet allocated funding for it.)

Oddly, while the group's blog has explained that Rep. John Larson's Social Security 2100 Act would boost benefits and bring the trust funds into long-term balance, the "Reformer" doesn't even give users the opportunity to choose it.

Social Security

The Budget Committee hearing will look at the feasibility and wisdom of expanding Social Security. How will the CRFB testify on this question? Its "games" (described above) should give you some idea.

The CRFB website misleadingly states that "for every $6 spent per senior, only $1 is spent per child." This ignores the direct payments seniors have made to fund their Social Security benefits/ It also artfully elides the fact that most childhood education is funded at the local level, not by the federal government.

"Most retirees get far more out of Social Security and Medicare than they pay into them during their working years," it claims, without mentioning that this also typically happens when money is invested.

"Seniors have the lowest poverty level of any generation," it adds, without pointing out that Social Security lifts 30-40 percent of seniors out of poverty. Or is their argument that we don't have enough poverty in this country?

The CRFB gave its full-throated support in 2019 to Sen. Mitt Romney's TRUST Act, which would create "bipartisan committees" designed to complete the work earlier committees and commissions failed to do: cut Medicare and Social Security benefits. MacGuineas deployed the group's usual rhetoric when Democratic Sen. Joe Manchin and Republican Sen. Shelly Capito reintroduced Romney's TRUST Act in 2021. 

"Senator Manchin and the other lead lawmakers deserve immense credit," MacGuineas said, adding: "The TRUST Act is a sensible, bipartisan and balanced approach that would bring together lawmakers to develop fixes ... "

Regressive Revenue

The CRFB has noted the negative impact of tax cuts on the federal debt, with blog posts like this one from 2010, and spoke out publicly against Trump's 2017 tax cuts (although it knew there was no way they weren't going to pass). But it has not endorsed what may be the largest revenue-generating suggestion of recent years, Sen. Bernie Sanders' proposed wealth tax.

The CRFB's 2021 campaign to offset the cost of the Democrats' proposed Medicare expansion—which would cover vision, hearing, and dental care—left the ultra-wealthy all but intact, offering instead a regressive premium tax on Medicare enrollees (during a pandemic that has hit seniors especially hard). CRFB policy head Marc Goldwein tweeted that he thought Medicare expansion was a "bad use of $$, if you ask me," but added:

"But if we going to expand Medicare anyway, let's at least not waste money in the process! Medicare Part B and D have premiums to cover ~1/4 of their costs -- why not this new benefit? Adding a premium would cut costs by ~$18 billion."

$18 billion is less than one-eighth of the wealth CRFB's would-be friend Elon Musk had already gained during the pandemic.

The group did express support for the drug price negotiation provisions in Build Back Better, even suggesting an increase in the number of drugs under negotiation. But it also celebrated politicians like House Dems Scott Peters and Kathleen Rice as "Fiscal Heroes." Peters and Rice subsequently voted against drug pricing reductions, a move which failed to draw even a mild rebuke from the CRFB. (Adding to the double-talk around this issue, Rice claimed she voted against this cost-saving measure in the name of "fiscal responsibility.")

Stealth Lobbyists

The Peterson network has always been closely aligned with corporate lobbyists. As the New York Times reported of "the Campaign to Fix the Debt" in 2013,

"... many of the campaign's members will be juggling their private interests with their public goals: they are also lobbyists, board members or executives for corporations that have worked aggressively to shape the contours of federal spending and taxes, including many of the tax breaks that would be at the heart of any broad overhaul."

This group, ostensibly an impromptu alliance of concerned corporate CEOs, also attempts to project an air of neutrality. When Sen. Chuck Schumer said in 2012 that the "Fix the Debt" CEOs supported a lower tax rate for the wealthy, the group's head promptly issued a statement: "The Campaign to Fix the Debt does not have a position on raising tax rates."A statement issued by the group, however, specifically called for "comprehensive and pro-growth tax reform, which broadens the base, lowers rates, raises revenues, and reduces the deficit." (Emphasis ours.)

Oh, and the head of the Campaign to Fix the Debt, the one who incorrectly claimed that the group does not have a position on raising tax rates? That was Maya MacGuineas.

From Our Table to Yours

The CRFB has positioned itself as an unbiased arbiter while keeping its thumb firmly on the scale. But its bias is revealed in that word: responsible. They assume a "responsible" federal budget is one that limits deficit spending, even if it costs human lives and makes budgeting harder for real families sitting around real tables. If the Budget Committee listens to them, it could mean disaster for millions of Social Security recipients.

The Peterson crowd should not be entrusted with Social Security—not in Thursday's hearing, and not ever.


Our work is licensed under Creative Commons (CC BY-NC-ND 3.0). Feel free to republish and share widely.
Richard J Eskow

Richard Eskow

Richard (RJ) Eskow is a freelance writer. Much of his work can be found on eskow.substack.com. His weekly program, The Zero Hour, can be found on cable television, radio, Spotify, and podcast media. He is a senior advisor with Social Security Works.

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