Derailing the Wall Street Attack on Social Security

Derailing the Wall Street Attack on Social Security

 

By Dean Baker, t r u t h o u t | Op-Ed

truthout

May 10, 2010

 

http://www.truthout.org/derailing-wall-street-attack-social-security59340

 

Emboldened by the fact that none of them have gone to

jail for their role in the financial crisis, the Wall

Street gang is now gunning for Social Security and

Medicare, the country's most important safety net

programs. Led by investment banker Pete Peterson, this

crew is spending more than a billion dollars to

convince the public that slashing these programs is the

only way to protect our children and grandchildren from poverty.

 

Peterson has so much money to spend on this crusade

that he can't even use it all up in the normal practice

of buying think tank studies that support his position.

Therefore he has sought out other mechanisms to support

his attack. For example, he has funded a nationwide

propaganda push called "America Speaks," which is

designed to get ordinary citizens to agree with his

Social Security slashing plans by giving them such a

limited range of options to deal with scary deficit

projections that they have no alternative [http://usabudgetdiscussion.org/]

 

Peterson is also funding a high school curriculum in

the hopes of indoctrinating the nation's young with his

quest. He has even created a news service called the

"Fiscal Times". The Fiscal Times intends to plant

deficit scare stories in newspapers that are desperate

for copy now that they have downsized their news

staffs. Peterson's son assembled the staff from the

large group of journalists displaced by the collapse of

the newspaper industry.

 

Peterson even funded the creation of a game "budget

ball" to convince young people that taking away grandma

and grandpa's Social Security and Medicare can be fun.

Of course we haven't said a word about all the

politicians of both political parties that this crew owns.

 

When kids get scared watching a horror flick, we tell

them to repeat: "it's only a movie." As the Peterson

gang ramps up its anti-Social Security and Medicare

crusade, it is important to remember: "it's just Wall

Street propaganda."

 

They have lots of ways to make the deficits and debt

look really really scary. Remember, these are

professionals, just like the folks that make those

Hollywood horror flicks. But, knowledge of some basic

facts will protect you and your children.

 

First, there are no remotely plausible projections that

do not show that our children and grandchildren will be

far wealthier on average than we are today. The

standard projections from the Congressional Budget

Office show that real wages will be more than 50

percent higher in 2040 (after adjusting for inflation)

than they are today. This means that even if our

children faced a huge 5 percentage point increase in

taxes, they would still be left with 40 percent more

income on average than do workers today.

 

Insofar as our children face a threat of declining

living standards it is from the growing inequality,

which is redistributing most income gains upward. If

the trend towards increasing inequality continues than

many young people will have lower standards of living

than their parents. However, intra-generational

inequality gets little attention from Pete Peterson and

his Wall Street gang.

 

The near-term (next 10 years) budget projections show

deficits that will be comparable to what we had in the

80s and early 90s, once the economy recovers from the

collapse of the housing bubble. The deficits projected

for late in this decade are largely attributable to the

wars in Afghanistan and Iraq and the extra interest

burden created by borrowing for these wars and the Bush

tax cuts, as well as the deficits needed to boost the

economy out of recession. The story of profligate

spending - apart from on these wars - is an invention

of the Wall Street gang.

 

Finally, the really big deficit horror stories coming

from this crew are derived from projections that our

broken health care system just keeps getting worse. The

United States already spends more than twice as much

per person on health care as the average for other

wealthy countries. This gap to projected to grow ever

larger over coming decades.

 

More than half of all health care spending is paid for

through government programs like Medicare and Medicaid,

therefore if these health care projections prove

accurate, we will have very serious budget problems. Of

course, we will also have enormous economic problems

since no one will have any money left over after paying

for their health care.

 

This situation should emphasize the urgency of fixing

the health care system, but the Peterson Wall Street

gang instead sees it as a reason to yelp about the

budget deficit. Fixing the health care system would

mean hurting the insurance industry, the pharmaceutical

industry and other powerful interest groups aligned

with the Wall Street gang. It is easy to design

policies that would substantially reduce costs.

However, the Peterson Wall Street gang would rather

take away Medicare and Social Security benefits from

retired workers than take away profits from the

insurance and pharmaceutical industries.

 

As we get further into the year, the Wall Street crew

is planning to escalate their propaganda. But don't let

them scare you - the problem is that too much money is

going to people like them, not Medicare, Social

Security and other key programs that support the public.

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