This weekend the New York Times ran what seemed to be a somewhat overly flattering piece about right-wing anti-entitlement hawk Pete Peterson, and the piece included this paragraph:
Progressives like Mr. Baker or Richard Eskow of the Campaign for America’s Future often paint Mr. Peterson as a disingenuous tycoon who made his fortune from the low carried-interest tax rate (it allows hedge-fund operators to shield earnings from the government). They argue that Social Security’s trust fund — while supplied with Treasury bonds, not dollar bills — will nonetheless stay solvent for decades, and accuse Mr. Peterson of shrewdly couching entitlement reform as a way to protect future generations when, in fact, it is today’s elderly who will suffer.
That would be Dean Baker, prominent economist, who describes Peterson with considerable accuracy:
““He’s not focused on the debt so much as on cutting Social Security and Medicare,” said Dean Baker, co-director of the liberal Center for Economic and Policy Research. “Even in the late ’90s, when we had a surplus, he was saying the same thing and the debt wasn’t in any obvious way a problem then.”
It’s true that Peterson made a lot of money from that hedge fund tax break (although I don’t recall ever mentioning it; I may have.) And it’s certainly true that Social Security’s Trust Fund will stay solvent, although without any changes it would have to reduce benefits by 25% in 2037.
But the Times gets our generational objection (or mine, at least) to Peterson’s agenda backwards. The article should have said that he stands accused of “shrewdly couching reform as a way to protect future generations when, in fact, it is precisely those future generations who will suffer under Mr. Peterson’s draconian plans.” It could have gone on to say that “today’s elderly won’t be touched – not those on Social Security, and certainly not those who, like Mr. Peterson, earn enormous amounts of money and are taxed at historically low rates.”
Mr. Peterson’s tax breaks are made politically possible by the campaigns which Peterson has so generously funded, over the course of many years. They’ve successfully distracted the press and the public from the fact that tax cuts for the likes of Mr. Peterson are a major source of deficits, while Social Security has not contributed to the deficit and never will. (It’s forbidden to do so by law.)
To his credit, Pete Peterson has signed the “billionaire’s pledge,” vowing to give half his fortune to charity. (Although if his right-wing media campaigns qualify as ‘charities,’ it could be a pyrrhic victory for the side of the angels.) His loathing for Social Security and Medicare certainly seems to be ideological, and doesn’t seem to stem from a desire to maximize his own wealth.
Despite what seems to be misplaced admiration for Mr. Peterson, the Times deserves praise for including the views of those of us who oppose his agenda. Other newspapers don’t even bother. Somebody apparently got to the editors at the Times, however, since they retracted what seems to be an inarguably correct statement by appending this “correction” to the article:
“The foundation does not have a partnership with The Washington Post. (The newspaper has published articles by The Fiscal Times, a publication that Mr. Peterson financed.)”
Actually, they seem to have gotten it right the first time. From a Fiscal Times news release dated December 17, 2009: “The Fiscal Times and the Washington Post have agreed to jointly produce content focusing on budget and fiscal issues that will be available to both publications.” That sure sounds like a partnership to me. But Peterson’s aggressive about intimidating people who have written things he doesn’t like, as I’ve experienced myself.
And for those who wonder why some of us never shared in the glow of 90’s-era political nostalgia, the article included this:
“He saw the long-term trends in health care and retirement spending before nearly all policy makers,” Bill Clinton wrote in e-mail. “Unlike some Democrats, he knows we need to cut spending. Unlike today’s Republicans, he’s not allergic to revenue increases.”
Peterson may not be “allergic” to revenue increases, but his position on them has been clear for twenty years: Taxes should be lowered even further for the rich, and the shortfall should be made up by additional taxes (like a national sales tax) and other policy changes that hit the middle class and leave the wealthy unscathed.
Peterson has managed to use his billions to win plaudits from center-right Democrats as well, allowing him to hawk his conservative agenda as “bipartisan.” But let’s summarize his position: Lower taxes for the rich. Higher taxes for the middle class. Deep cuts in entitlement programs that provide health and financial security for the elderly.
Sounds pretty conservative to me.
As I’ve always said, there’s nothing wrong with holding conservative opinions. But it’s a bit disingenous to claim that they’re not conservative. And then there’s fact the so many of the policy papers (by Alice Rivlin et al.), ad campaigns, “town halls,” and gimmicky games produced with Mr. Peterson’s money either downplay the cleanest fix for Social Security’s long-term problems, or fail to mention it altogether: Lift the payroll tax cap. That’s the key element of a solution endorsed Ronald Reagan’s chief Social Security actuary, and it’s both practical and popular.
Mr. Peterson himself said this: “We would suggest for consideration some combination of gradually increasing the retirement age, indexing it to longevity, and reducing benefits for the well off through what I call an affluence test or progressive wage indexing. Then one could also lift the payroll tax cap.”
But the first three steps wouldn’t be necessary if the tax cap were lifted first. Why put these options in this peculiar sequence? Peterson’s statement is designed to sound reasonable, but actually stacks the deck in favor of cuts and against lifting the cap. And, of course, he doesn’t specify how high the cap should be lifted. He may not be “allergic” to revenue increases, but he’s not taking any chances either.
This kind of misleading presentation, wrapped in superficially reasonable language, is a Peterson hallmark.
Hey, I’ve got nothing personal against the guy. Yes, we’re tough on him. But anybody who’s worked for Richard Nixon, as Peterson did, has a thick hide. And if that “disingenous tycoon” label really bugs him, he should really consider correcting the misleading nature of the materials he’s funded through AmericaSpeaks, Budgetball, and papers by the like of Ms. Rivlin.
He could probably do that with a couple of phone calls.