Daily Archives: November 30th, 2012

Of Billionaires and Deficit Scolds


People are lying to us. Very wealthy and very powerful individuals have decided as a first recourse to lie. Not as a last recourse, but as a first, right out the door. They begin with the lie. “Social Security is an entitlement”. That’s a lie. We pay for it; each of our paychecks pay for it. It’s ours, not there’s, not the treasury’s, ours. But that’s just one of their lies. They are lying about the nature of our economic situation; about who is responsible for our current debt, and about who is most able to pay for it. They are not deluded nor are they dumb: They are just lying.

Who are these people? They are represented by an organization entitled ‘Fix the Debt’ whose business is anything but. They are a bipartisan pack of CEOs, organized around principles of ‘austerity’ for everyone but themselves and their political hacks and funded in part by former private equity magnate Peter G. Peterson’s foundation. They have pledged to push for austerity during the lame duck congressional session, and beyond. Peterson (buddy of Erskine Bowles (D) and Alan Simpson (R)—our courageous ‘bi-partisan’ cat food commission leaders ) has spent nearly half a billion dollars in recent years pushing his austerity agenda. The man is no slouch when it comes to lobbying to starve the poor and enrich the rich: a reverse robin hood for the ages.

According to the Institute of Policy Studies the ‘Fix the Debt’ organization is made up of “71 CEOs who lead publicly held companies….[These CEOs] have amassed an average of $9 million in their company retirement funds. A dozen have more than $20 million in their accounts. If each of them converted their assets to an annuity when they turned 65, they would receive a monthly check for at least $110,000 for life. The Fix the Debt CEO with the largest pension fund is Honeywell’s David Cote, a long-time advocate of Social Security cuts. His $78 million nest egg is enough to provide a $428,000 check every month after he turns 65. Forty-one of the 71 companies offer employee pension funds. Of these, only two have sufficient assets in their funds to meet expected obligations. The rest have combined deficits of $103 billion, or about $2.5 billion on average. General Electric has the largest deficit in its worker pension fund, with $22 billion.”

I want to repeat something that you might miss in that paragraph. Of the 71 companies represented only forty-one offer any type of pension fund to their employees—the rest presumably get to receive the unregulated munificence of ‘the market’—meaning their skimpy 401Ks—if they even have one. Of these forty-one (41) who offer some type of pension plan ONLY TWO (2) have sufficient assets in their funds to meet their expected obligations. These clowns—these fiscally irresponsible yahoos—who have now allocated millions for themselves while refusing to fund their own obligations to their own workers are the deficit scolds telling us how to put our house in order? Really? These are the megalomaniacs who are arguing that Social Security benefits are ‘too generous’ and are cautioning us about our ‘fiscal’ health? The very people who have NOT paid into retirement funds for their own workers?

As the report concludes, “as the debate heats up over whether to cut Medicare, Social Security or Medicaid in order to maintain federal spending and corporate tax breaks, companies with well-compensated CEOs who preside over underfunded employee pension funds invite a new round of questions about the motives, and methods, of the CEOs pressuring Congress and the White House to cut programs for the middle class.”

You think?

Sadly, this is nothing new. Though it seems more obvious than ever, if you pay attention.

The nation’s largest creditor is not China. It is the working people of America and their employers who collectively have amassed Social Security’s huge surplus through the weekly FICA contributions required by law. This wealth is the nest egg that will pay for swelling benefits as the baby-boom generation retires. Far from being broke or “sucking” billions from the Treasury, the Social Security trust fund will continue to accumulate larger and larger surpluses during the next ten years, reaching $3.7 trillion by 2022, according to the system’s trustees.

Jack Johnson