President Obama has packed the Debt Commission (also known as the cat food commission) with members who have an overwhelming history of support for both benefit cuts and privatization of Social Security.
The “National Commission on Fiscal Responsibility and Reform” is operating in secret over the objections of both parties. John Boehner and John Conyers have both raised concerns that the commission will make recommendations in December that could be passed by a lame duck Congress that doesn’t have to worry about being reelected. They requested that the commission report its findings prior to the election so that the public can have a chance to factor in the recommendations into their voting decisions in the election. The commission denied the request.
As we are seeing with Audit the Fed, it is falling to Judd Gregg — who doesn’t have to worry about being reelected — to raise concerns about “populist pandering,” and he is likely to be the one to refuse unanimous consent and force a cloture vote that will impose a 60 vote hurdle. (The transpartisan support for Audit the Fed we’ve built over the year makes it difficult for anyone with re-election worries to play the Joe Lieberman role, even Joe Lieberman.) Though they have different agendas with regard to the outcome, the concerns of both Boehner and Conyers and the commission’s lack of transparency are well founded.
As we reported at the time, the Obama White House has been interested in cutting Social Security right out of the gate. David Brooks reported that three administration officials called him to say Obama “is extremely committed to entitlement reform and is plotting politically feasible ways to reduce Social Security as well as health spending” in March of 2009. The neoliberal TNR/JournoList set who cheered on the Iraq war and the corporate-friendly health care bill are already lending their support: Privatizing Social Security, No, Cutting Social Security, Si! says Jon Chait.
Chait conflates and confuses two separate statements. Obama has dismantled liberal opposition to many of George Bush’s policies, and whatever he wants to do with Social Security will be accepted by many just because they like him. Matt Yglesias had this to say about Elena Kagan’s nomination to the Supreme Court: “Clinton & Obama like and trust [Kagan], and most liberals (myself included) like and trust Clinton & Obama.” To which Glenn Greenwald rightly responds, “In other words, according to Chemerinksy and Yglesias, progressives will view Obama’s choice as a good one by virtue of the fact that it’s Obama choice. Isn’t that a pure embodiment of mindless tribalism and authoritarianism?”
What Wall Street wants is to wind up with a good chunk of the Social Security trust fund in its own coffers. Where that intersects with the objectives of the commission remains to be seen, but the fact is that Obama has packed it with people who have a strong history of supporting both reducing benefits and privatization. Even the token “liberals” like Jan Schakowsky have a history of abandoning their strongest principles when the President asks it of them, and Dick Durbin is now telling “bleeding heart liberals” to be open to benefit cuts for the sake of the fiscal responsibility.
Brad DeLong indicates liberal objections may well be overcome by the government guaranteeing any Wall Street losses, but that will irk the libertarians.
In the absence of any transparency with regard to the Commission’s proceedings, this is what we have to go on. . . .:
|Member||Open to cutting benefits?
|Expressed support for privatization?
|Conflicts of Interest
|Erskine Bowles, Chair||YES – Bowles is on the record that the commission will “mess with Medicare, Medicaid and Social Security, because if you take those off the table, you can’t get there.||YES – Negotiated deal with Newt Gingrich to raise Social Security retirement age & some privatization under Clinton; deal was stopped by Lewinski scandal.||Sits on the board of Morgan Stanley. Wife Candice is on the board of JP Morgan Chase. Finance, insurance & real estate sector donated over $3 million to his unsuccessful 2004 Senate bid.|
|Alan Simpson, R-WY-ret, Co-Chair||YES – When asked about cuts he would recommend to the President and Congress on CNBC, Simpson said “We are going to stick to the big three,” meaning Social Security, Medicare and Medicaid.||YES – “[A]s recently as 2005, Simpson…supported attempts by President George Bush to privatize Social Security by turning part of the pension and insurance program into millions of individual investment accounts, which by now would have lost 20 percent of their value.” (2/27/2010)||Simpson and Peterson were appointed to Bill Clinton’s Bipartisan Commission on Entitlement Reform in 1994. Both voted to recommend partial privatization of Medicare, and raising Social Security age of eligibility to 70, Simpson awarded “Economic Patriot” award by Peterson’s Concord Coalition in 1996.|
|Ann Fudge||Unknown||Unknown||Board member on the Council of Foreign Relations, where Peterson is Chairman Emeritus and Robert Rubin is Director/Co-Chair, fundraiser for Obama campaign, Novartis Board of Directors|
|Alice Rivlin||YES – Co-author with OMB director Peter Orszag of a Brookings report titled “Restoring Fiscal Sanity” advocating $47 billion in entitlement cuts, including an “increase in the retirement age under Social Security” and “more accurate in?ation adjustments to Social Security bene?ts.”||Unknown||Board member with Pete Peterson on Committee for a Responsible Budget, Former board member with Peterson of Public Agenda (Peterson gave them $500,000 in 2009), Advisory Council member of Robert Rubin’s Hamilton Project, Senior Fellow at the Economic Studies Program at the Brookings Institute (position funded by Peterson Foundation/Concord Coalition donations).|
|John Spratt (D-SC)||Yes – “House Budget Committee Chairman John Spratt of South Carolina and his counterpart in the Senate, Kent Conrad of North Dakota….are promoting a “grand bargain” in which a bipartisan commission enacts spending caps on social insurance as the offset for current deficits.” (2/23/2009)||Yes – “Spratt favors supplementing Social Security with a private savings plan that would either be mandatory “or else so attractive that everyone would sign up for it.” He also advocates investing about 20 percent of the Social Security trust fund in the stock market.” (4/7/1998, per Lexis)|
|Andy Stern||Unknown – Previously opposed to cuts, but said recently that entitlement programs “need to be re-examined”.||Expressed support for of “the possibility of add-on universal private accounts.”|
|Dick Durbin (D-IL)||YES – Durbin admonished “bleeding heart liberals” to be open to program reductions to restore fiscal balance.||Unknown|
|David M Cote||Likely – Cote is a Republilcan.||Unknown||CEO of defense contractor Honeywell. The defense industry has consolidated itself into a few big players, and they see their financial futures in competition with social safety net programs for government dollars. They won big when 9/11 blew the lock off the Social Security “lockbox.”|
|Paul Ryan (R-WI)||YES – Ryan’s recently released budget plan calls for “enormous tax cuts for the affluent and “very large benefit cuts… in Medicare, Medicaid, and Social Security.”||YES – Ryan proposes to give people under age 55 the choice of opting out of Social Security into privatized personal accounts.||Ranking minority member on House budget committee.|
|Jeb Hensarling (R-TX)||YES – On Hardball, “Rep. Jeb Hensarling (R-TX) argued that to balance the budget Congress needed to consider reducing Social Security spending for yet-to-be-retired beneficiaries.” (2/2/10)||Yes – In a 2005 Congressional hearing, said that “the trust fund has already been raided 59 different times,” but that “with the exception of the great depression there has never been a four year consecutive period where the stock market has declined.” If allowing people to invest in half their Social Security in a personal account will “give them greater retirement security,” he said, “why wouldn’t we choose that plan?”||Second ranking minority member on House budget comittee|
|Dave Camp (R-MI)||Likely – Says he doesn’t want to cut current retirees’ monthly checks, but Diamond-Orszag plan being pushed by the Obama administration cuts benefits for future retirees who are now under 55.||Yes – “He was a strong supporter of Bush’s proposal to create private investment accounts within Social Security, despite the backlash the plan encountered,” per CQ Healthbeat, 2/2/09 (Nexix). Also a signatory to Republican Main Street Partnership 98-RMSP3.||Ranking minority member, Ways & Means Committee|
|Xavier Becerra (D-CA)||No||No|
|Jan Schakowsky (D-IL)||No||No|
|Judd Gregg (R-NH)||Yes – Gregg’s plan “would reduce the traditional guaranteed
” (USA Today, 7/27/98, Nexis)
|Yes – Gregg’s solution to “Social Security’s fiscal problems” included “large-scale privatization” and raising the eligibility age to 70 by the year 2029.||Ranking member of the Senate Budget Committee|
|Tom Coburn (R-OK)||Yes – “There are only three things you can do with Social Security,” Coburn said. “You can raise taxes on Social Security, you can allow option-out into private accounts or you can delay retirement age…I’m not for raising taxes on Social Security when you fix it other ways.” (4/25/10)
|Yes – “Coburn called for creation of private accounts that would keep Congress from spending the money.” (Oklahoman, 11/26/04, Nexis)|
|Mike Crapo (R-ID)||Likely – Co-sponsor of the DeMint-Crapo Amendment, which would have “made no changes to the benefits of those Americans born before January 1, 1950.” Like Dave Camp, implied benefit cuts to those born afterwards.||Yes – DeMint-Crapo Amendment would have “provided a voluntary option for younger Americans to obtain legally binding ownership of a portion of their [Social Security[ benefits…I believe that individuals have the right to make decisions about their own money.”|
|Max Baucus (D-MT)||Likely – Baucus said he was open to discussion if Bush would take privatization off the table||Unknown||Chairman of the Senate Committee on Finance, tapped by Reid to lead the battle against President Bush‘s privatization of Social Security. But according to Yglesias, “the Democrats’ only real victory of the last five years–stuffing the administration on Social Security–came after Harry Reid explicitly ordered Baucus not to negotiate with the White House.”|
|Kent Conrad (D-ND)||Yes – “House Budget Committee Chairman John Spratt of South Carolina and his counterpart in the Senate, Kent Conrad of North Dakota….are promoting a “grand bargain” in which a bipartisan commission enacts spending caps on social insurance as the offset for current deficits.” (2/23/2009)||Yes – “I think there is a kernel of a good idea with individual accounts because we do need to find a way to get a higher rate of return on funds invested in Social Security. But I cannot support a plan that is financed by massive new debt.…This administration is not collecting the taxes that are due now. Hundreds of billions of dollars a year that are owed that are not being paid. We should do that. That would give us a new revenue stream that could be applied to individual accounts and the other parts of the budget deficits that are hurting the country.” (This Week, February 13, 2005, Nexis)||Chairman of the Senate Budget Committee.|