fresh voices from the front lines of change







Social Security and Medicare opponent Pete Peterson funds through his foundation a “Fiscal Wake-Up Tour,” which characterizes itself as a non-ideological truth-telling presentation bravely warning the nation that Social Security and Medicare need drastic changes to save our children from crushing debt.

But the “Fiscal Wake-Up Tour” actually is the worst kind of ideological exercise, one that blindly follows a political position regardless of the facts.

We know that Social Security is basically structurally sound. We know that skyrocketing health care costs throughout the system are the primary fiscal threat. Yet the Tour refuses to follow the facts and adjust it’s views. (CEPR delivered a definitive take-down of the documentary of the Tour, “I.O.U.S.A.”)

I attended the Boston stop of the tour last night, and confronted the panel on its misinformation. Their responses only further proved my point.

You can watch our exchange at the bottom of this post, while I’ll explain their bizarrely dishonest and evasive responses.

1. Social Security benefits are non-fiction. Peterson Foundation CEO David Walker respond to my factual observation that Social Security will pay full benefits through 2049, by repeatedly insisting “There are no trust funds. It’s a fiction!”

But I didn’t say anything about the abstract concept of a “trust fund,” because the bottom line is the benefits will get paid. Quoting Dean Baker:

Under the law, SS is financed by a designated tax. The surplus over the last quarter century has been used to acquire more than $2.4 trillion in government bonds. According to the SS trustees, the bonds held by the trust fund will be sufficient to keep the program fully solvent until 2042. According to the non-partisan Congressional Budget Office, the program will be fully solvent until 2049. Both dates are far enough out that reasonable people need not panic, we have dealt with far more imminent SS shortfalls.

Walker grudgingly conceded the point, but then reverted to harping on the trust funds. When I interrupted to ask, “will full benefits be paid by the year 2049?” Walker responded: “2041, if you recognize the fact that the bonds are real but the trust funds aren’t.”

I reiterated, “The trust funds aren’t an issue if the benefits get paid,” to which he said again “there are no trust funds.”

Head, meet wall.

2. Health care costs, not Medicare costs. Prior to the above clip, it was interesting to see all the panelist recognize the reality that primary fiscal problem is skyrocketing health care costs — as this was the White House message coming out of the fiscal responsibility summit, strongly advocated by groups such as ours. It’s the plain reality.

This is a problem clearly driven by our private health insurance system, not by our government-run Medicare program. It certainly isn’t a problem in other nations with universal health care systems.

In fact, one the members of the Fiscal Wake-Up Tour, Isabel Sawhill from Brookings Institution, actually made this point. (Hers was the least awful of the presentations.) Her health care reform recommendations have absolutely nothing to do with Medicare, but propose comprehensive reform including universal coverage with cost controls. (You can download an earlier version of her PowerPoint presentation here.)

Yet the Tour’s proclaimed “rock star” David Walker continued to blithely assert that Medicare needed major changes, as if his Tour colleague’s presentation did not exist.

So when I pointed out that we just heard the exact opposite from Ms. Sawhill five minutes ago, Walker offered nothing but a blank stare.

3. Heritage for Socialized Medicine! Seeing Walker trapped, the Heritage Foundation tour member, and United Kingdom native, Stuart Butler stepped into the silence.

And after his earlier presentation effectively proposing more privatization of our retirement and health insurance systems, he had the gall to cite the UK health system as a reason to undermine Medicare: “I come from a country … which has a budget and has made decisions and set priorities in health care … We have a very different system here, which is totally open-ended.”

Stunned, I asked Butler if now Heritage is supporting national health care systems in England, France and Canada. He ignored the question.

Butler also shared Walker’s skill in using condescension to pretend the questioner said something he didn’t. He lectured to me: “So don’t kid yourself that … you can just sort of fix health care, like it’s sort of on some separate planet, that we don’t have to deal with the structure of the health care system.”

Well of course, that was my entire point!

But Butler, like Walker, then made the dishonest connection dealing with “the structure of the health care system” meant attacking “Medicare and Medicaid.” It does not, since Medicare and Medicaid are more cost-effective than the private health insurance system.

4. Priorities. The initial spat I had with Walker on the tape, regarding his boss Pete Peterson and the Bush tax cuts, is less central to these policy questions, but speaks to the underlying motivations of his Foundation and Tour.

Walker chose to bust me (and granted, I gave him the opening with a poorly worded question) and note the Peterson Foundation did not exist until recently, so how could it have opposed the Bush tax cuts? And besides Peterson himself and Walker did oppose the tax cuts at time.

However, my point was not about perfunctory opposition, but about priorities. Peterson and his posse can easily gain non-ideological currency by stating opposition to various things.

But what do they spend money on? What do they steer everything back to with rhetorical sleight-of-hand, no matter what the facts are?

Peterson could have spent $1M on ads opposing the Bush tax cuts. He could spend that money now supporting comprehensive cost-saving health care reform.

But he only chooses to spend it on attacking Social Security and Medicare, when they are in fact, not the underlying fiscal problem.

That speaks to blind ideology, which is what The Fiscal Wake-Up Tour is all about.

Watch the video of our exchange below. For an honest assessment of our fiscal challenges, check out this podcast featuring Roger Hickey, Dean Baker, James Galbraith and Nancy Altman. Thanks to Anne Thompson for producing the video.

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