Tweet
A bipartisan gathering of deficit terrorists and deficit errorists is convening in D.C. today to discuss how best to continue trashing of American’s middle class, and the economy generally (h/t PrestoVivace). Livestream is available, although I strongly recommend a quick vaccination against the bat-shit-crazy before viewing.
From the Peter G. Peterson Foundation website: Nation’s Lawmakers, Policy Experts and Thought Leaders to Come Together in Washington on May 25 to Discuss Bipartisan Solutions to America’s Long-Term Debt and Deficits:
On Wednesday, May 25, 2011, senior Administration officials, policy experts and Democratic and Republican elected leaders will come together in Washington to discuss solutions to the nation’s fiscal challenges at the 2011 Fiscal Summit: Solutions for America’s Future, convened by the Peter G. Peterson Foundation. As the nation confronts critical choices about how to address our long-term debt and deficits, the Foundation’s second annual Summit will bring together hundreds of stakeholders from across the ideological spectrum to discuss proposals to be presented by leading policy organizations and explore concrete, bipartisan solutions.
Participants include keynote speaker President Bill Clinton; Members of the Congress working on fiscal issues including Senators Saxby Chambliss (R-GA), Kent Conrad (D-N.D.), Mike Crapo (R-ID), Dick Durbin (D-IL), and Mark Warner (D-VA) and Congressman Paul Ryan (R-WI); National Economic Council Director Gene Sperling; Governor Mitch Daniels, Co-Chair of the National Commission on Fiscal Responsibility and Reform Alan Simpson, and Foundation Chairman Pete Peterson and Vice Chairman Michael Peterson.
At last year’s Summit, participants agreed on the need to take action on the nation’s long-term debt and deficits. With increased consensus that our country’s fiscal situation is unsustainable, this year’s Summit will bring together stakeholders from across the political spectrum to discuss a range of concrete, comprehensive solutions.
The American Enterprise Institute, Bipartisan Policy Center, Center for American Progress, Economic Policy Institute, Heritage Foundation and Roosevelt Institute Campus Network will present and discuss their own proposed packages of solutions for achieving long-term fiscal sustainability at the Summit. These leading policy organizations, representing diverse perspectives, received grants from the Peter G. Peterson Foundation to develop comprehensive plans to address the nation’s projected long-term debt and deficits.
If any sane voices are to be heard, the only group I hold out any hope for is the Roosevelt Institute Campus Network. Will anyone do what is actually needed and challenge the underlying premise? All it would take is for some brave soul to ask the question, “Is The Federal Debt Unsustainable?” as James K. Galbraith did in his May 5, 2011 Policy Note at the Levy Economics Institute (pdf). Here are a few bits to assist in watching the Peterson freak show:
By general agreement, the federal budget is on an “unsustainable path.” Try typing the phrase into Google News. When I did it, 19 of the first 20 hits referred to the federal debt.
But what does this mean? The phrase is often stated, but rarely defined clearly. One is led to suspect that some who use the phrase are guided by vague fears, or even that they do not quite know what to be afraid of. After a brief discussion of the major worries, this note will attempt to clarify one, and only one, critical issue: the actual behavior of the public-debt-to-GDP ratio under differing economic assumptions through time.
Some people fear that there may come a moment when the government’s bond markets would close, forcing a default or “bankruptcy.” But this betrays nonunderstanding of both public finances and debt markets. The government controls the legal-tender currency in which its bonds are issued and can always pay its bills with cash. Apart (possibly) from the self-imposed politics of debt ceilings, a US government default on dollar bonds is impossible, and the word “bankruptcy”—which is a court proceeding to protect privatedebtors from their creditors—also does not apply.
Conclusion: It’s the Interest Rate, Stupid
The significant conclusion is that there is a devil in the interest rate assumption. If the real interest rate on the public debt is assumed to be greater than the real growth rate, unstable debt dynamics are likely. The offsetting primary surplus that is required for stability is an onerous burden for most countries, and to achieve it in the United States would be practically impossible, since the required cuts would undermine GDP growth and tax revenues. This is why the various budget plans now in circulation will not workout, if they are ever implemented.However, where the real interest rate is below the growth rate or even slightly negative, the fiscal balance required for stability is a primary deficit, and the sustainable deficit gets larger as the debt “burden” grows. This is why big countries with big public debts can run big deficits and get away with it, as the United States has done almost without interruption since the 1930s.
Many decades hence, the entire kerfuffle over “unsustainable paths” for the debt-to-GDP ratio will be remembered as today we remember the grand old Duke of York:
The Grand old Duke of York,
He had ten thousand men.
He marched them up to the top of the hill
And he marched them down again.
……………………………
UPDATE @ 9pm EDT: the summit live video link above is repeating the day’s events for all who don’t want to miss the bipartisan freak show.
……………………………
NOTE: x-posted at my blog — selise
……………………………
45 Comments
i have to step out for a bit this afternoon, but am recording the summit and expect to add an update later….
discussing the BPC proposal vs the ryan plan re medicare now.
everyone seems to agree that the size of the federal government is a “dead weight” on the economy.
Selise, you nailed it with “A bipartisan gathering of deficit terrorists and deficit errorists” but in addition to the ‘vaccination’ a portable potty is recommended for the barfing that will occur in watching.
REC’d.
pete peterson gives a quasi-benediction and the summit is over.
a porta potty! you’re exactly right. that’s what’s missing. thanks!
oh, this is great!
for anyone who missed the summit, the live streaming link is not showing a repeat. pete peterson is giving the opening intro… now, so it’s not too late to miss the entire event!
pete peterson says the public “debt” will cause a financial crisis.
nothing about private debt levels.
gold standard thinking and china fear mongering.
oh great. bill clinton just said that the reason we can’t enforce trade regulations is because no one punches their banker.
Ah, rounded-off, the usual suspects.
Odd that they are all rather well-off, sheer coincidence, no doubt.
I am also intrested to hear what the Roosevelt Institute Campus Network will have to share, selise.
Thank you for keeping tabs on the astoundingly amazing adventures of Monetary Policy and the Holy Grail.
Definitely recommended!
DW
DW
thanks DW!
i tried downloading the RICN plan earlier (no dice, server error), and will try again later…. because what i heard was not good, and this faux summit definitely needs a response.
please see update at the end of the diary. it’s not too late to miss the freak show, the live feed is now running repeats.
Thank you, selise. It does need an answer.
Download seems to work here: http://www.rooseveltcampusnetwork.org/blog/budget-millennial-america
here’s an article by Zachary Kolodin: http://www.newdeal20.org/2011/05/25/progressives-can-fight-budget-battles-with-a-home-field-advantage-46097/#comment-14581 along with a critical comment from me.
Marshall Auerback seems to have been an advisor, though I can’t believe they took very much of his advice. The Millenial Budget shares the orientation toward deficit reduction we see in the others: deficits being reduced regardless of circumstances, deficits bad, surpluses good.
The long-range objectives are to reduce debt-to-gdp ratio, and have surpluses. No recognition that surpluses can be bad. No recognition that fiscal policy is responsible when it focuses on outcomes that fulfill the public purpose, and that it is irresponsible when it focuses on managing indicators like the deficit, debt, and debt-to-GDP ratio.
The case against the very idea of deficit reduction was made here:
http://my.firedoglake.com/letsgetitdone/2010/11/18/the-very-idea-of-a-long-term-deficit-reduction-plan/
Pete Peterson tried to rally popular support for social security cuts by holding “America Speaks “ town hall meetings in mostly rich republican areas
But a funny thing happened this weekend at these “America Speaks” events. Members of the public, after being given what Roger Hickey calls “misleading background information about the federal deficit and economic options to achieve fiscal ‘balance’ and future prosperity,” got a chance to weigh in on what they thought the most prudent course of action might be. As Thomas Frank points out in the Wall Street Journal today (6/30/10; subscription required), the results were likely a huge disappointment to Peterson:
http://www.fair.org/blog/2010/06/30/pete-petersons-real-crisis-america-speaks-and-says-the-wrong-thing/
Humiliating as this was for Pete and ignored by the MainStreamMedia which still trumpets Social Security cuts as the only way to balance the budget.
It just gets worse for Pete if you notice that Pete never gave the people at his “America Speaks ” Town Hall Meetings the option of ending the wars in Iraq and Afghanistan to raise money for Social Security. Or the Keynesian solution that worked in the Real World during the Great Depression namely that government borrows money to put people back to work and we tax the shit out of the rich to pay for it.
http://my.firedoglake.com/thingscomeundone/2011/01/24/pete-peterson-cant-con-adults-so-now-hes-going-after-kids/
America Speaks is the brainchild of billionaire hedge fund manager and tax cheat Pete Peterson, who is helping fund the deficit commission. These town hall-style events are designed to be a propaganda tour for the need to scale back deficits by cutting social spending. In a letter to supporters titled “Rally to save Social Security,” MoveOn asks members to attend the America Speaks events.
The Deficit Commission is the executive panel charged with deciding our country’s spending priorities. The problem is, it’s filled with people who are obsessed with using the deficit as an excuse to cut Social Security and Medicare.
Until now, the commission has been holding only closed-door meetings in Washington. But this Saturday, an outside group that will report back to the commission is holding town halls on the budget across the country.
Here’s the catch: that outside group is sponsored by a billionaire hedge fund manager who’s been working to gut Social Security and Medicare for decades, and the organizers get to decide who can attend.
http://news.firedoglake.com/2010/06/24/blowback-progressive-groups-mounting-challenge-to-pete-peterson-social-security-cutters/
If you want to talk about Pete Peterson its always good to remind readers that he lies about the facts, is a tax cheat, and even when he lies about the facts can’t even convince Republicans in Red areas his lies are fact.
The GOP Governor’s in Wisconsin, Michigan, Maine, Ohio and Indiana all seem to be following Pete’s game plan.
Rep Ryan is claiming Pete’s homework as his own.
Pete needs to take credit for the GOP ideas that are even less popular with voters than Sarah Palin running for President.
We need to get our ideas out there on tv Bill Clinton made the news today Selise he was socializing with Rep Ryan and agreeing with him.
We need to create jobs we need to point out FDR created jobs even though it put us in debt, he taxed the rich 90% of their income and taxed beer ( we could tax pot) the biggest thing is create good paying jobs and get the economy going.
FDR’s ideas worked in the real world Pete/Ryan’s ideas were tried by Herbert Hoover they failed.
America can’t afford any more Right Wing experiments.
Sometimes teh krazed is more than I can gear.
Petersons, Foundation, and their minions is the more I can’t bear today.
May they rot in the hell of their own making and leave we the people alone.
Their place on this planet is unsustainable.
Rcc’d, mightily, despite the bile that came up from my gut into my mouf, just a little bit.
LeSigh.
Oh, and great comments folks, thanks,
There is over a trillion dollars in gold in fort knox just gathering dust give that cash to the the T- bill holders that much gold all going on the market at once would crash the gold gold market but who cares the lets cut SS and Medicare people are also Gold bugs.
So lets ruin them by giving them everything they want. If they want the National Debt paid fine we can pay a trillion now that should strengthen the dollar at the expense of all the Glen Beck Gold bugs who doubted America could pay its debts.
Then end both wars and use the money to create good paying jobs fixing America Rome used its solders to build roads and bridges just hire a bunch of non combat ever solders for 6 months to fix our roads remember the defense budget has already been approved. Just take the money approved already and use that to create jobs.
I can think of some bankers I’d like to punch. Actually, I think the entire USA would love to punch them.
why pay in gold when we “owe” dollars?
us fed govt is the monopoly issuer of dollars. the debt issue is bogus…. we should be debating how the money gets spent, how to reach full employment, how to address global warming and kick our oil addiction. educating our kids, clean environment, clean water, good healthy food. universal health care,… the list of real issues goes on and on.
and yet we are stuck with a fake issue, i guess because deecee is a madhouse. either that or they know what they’re doing, which is means things are even worse.
thanks for the links!
yeah, it was bad. i listened to clinton today (via the peterson summit livestream). actually i listened twice!
if there’s no official transcript and i get the chance, i’ll try to do a bit of transcription.
punching metaphorically, of course! :)
yeah, but i don’t think clinton was talking about goldman sachs and jp morgan.
actually, the more i think about it, the more i think clinton’s statement was quite clever (in a diabolical and bankster protecting way). he attempted to focus american anger re banksters at those foreigners (chinese, etc) who save dollars and send us real stuff. instead of the read banksters right here at home. our very own vampire squid and an obama justice department seemingly bent on protecting their fraud.
thanks. the RICN plan downloads now. earlier there was a 503 server error (same link).
Bill Clinton’s Private Words to Paul Ryan Caught on Tape
Fire it up
11
105 Share The day after the stunning upset in the special congressional election in upstate New York, Rep. Paul Ryan is a man under fire.
But ABC News was behind the scenes with the Wisconsin Congressman and GOP Budget Committee Chairman when he got some words of encouragement none other than former President Bill Clinton.
“So anyway, I told them before you got here, I said I’m glad we won this race in New York,” Clinton told Ryan, when the two met backstage at a forum on the national debt held by the Pete Peterson Foundation. But he added, “I hope Democrats don’t use this as an excuse to do nothing.”
Ryan told Clinton he fears that now nothing will get done in Washington.
“My guess is it’s going to sink into paralysis is what’s going to happen. And you know the math. It’s just, I mean, we knew we were putting ourselves out there. You gotta start this. You gotta get out there. You gotta get this thing moving,” Ryan said.
Clinton told Ryan that if he ever wanted to talk about it, he should “give me a call.” Ryan said he would.
thanks sadlyyes.
clinton said similar stuff during his talk. it wasn’t a secret. the only thing new caught on the tape was that clinton talked with ryan.
too bad,billy boy doesnt have a ranch like little boots…to leave the public eye for 5 mins
Selise I agree with you about creating jobs. However just what does having all that gold in fort knox do just sitting there to help America does it earn any interest? No
Gold prices go up as the dollar gets weaker so gold prices are high right now so it does make sense to sell the gold now.
We can use the money from the gold sale to pay down the debt, create jobs, create national healthcare or ant combination of the three.
Even 1/3 of a trillion dollars if it were used to create jobs would have a great stimulus effect.
The great thing is the GOP can’t say we are raising taxes so this stops Tea Bagger whining.
I want the GOP to attack creating jobs with money we already have. I want the GOP to argue we should cut Medicare and SS rather than use the money in Fort Knox to create jobs.
The Media the GOP and Bill Clinton are trying to limit our choices to America defaults on its debt or we cut Medicare and SS they won’t mention raising taxes on the rich or more borrowing.
Fine if we can’t bring up real world examples of FDR doing just that in our Pravda media then lets hit them in from an other direction.
Expand the battle field and force the GOP to spread their ranks thin to defend their position and we weaken their defense in all directions. Including your line of argument Selise I’m just thinking tactics I am not saying stop arguing your line of thought.
I’m saying its easier to beat the GOP if they have to defend themselves from several directions at the same time.
The GOP attacks us by dividing us with lies about Dark People, Gays, Muslims etc we can use facts to divide them.
The GOP hates taxes on the rich but how many rank and file Tea baggers would object to America selling the Gold in Fort Knox that is not earning any interest being used to create jobs?
This is found money. We bring up my idea and the GOPers who want jobs need jobs join us to support government creating jobs.
Healthcare is dead until Obama gets some Cred so we use half the cash to pay down the debt. Half a trillion dollars right now to pay down the debt would make all the budget projections Ryan uses even more of a joke than they are now.
That would save medicare and SS with less tax increases on the rich than we would otherwise need.
1/2 a trillion to create good paying jobs now to fix our infrastructure and go green power would lower our costs to produce goods at some point better roads bridges and trains lowers the cost to transport goods, more cheaper clean green power lowers manufacturing costs, less pollution from green power and water treatment plants means less worker sick days and more production from less worker sick days..
Never mind 1/2 a trillion dollars going to regular Americans rather than banks so people can buy stuff.
Give rich people tax cuts and they invest in companies that outsource jobs and America losses jobs Tom Friedman is wrong. Give regular Americans cash they buy stuff in our economy PAY TAXES to America and all Ryan’s budget projections go wrong.
Now if we had a simple economic video game where ANYBODY could plug in the numbers we could communicate this message to regular Americans without the media filter that limits our choices to the Ryan/Clinton plan of we must cut Medicare and SS.
The GOP The Dems all and the major media want to screw us…where is the outrage from MSBC to Peterson that was (rightfully) shown to the Kock Bros? I have written to Rachel M. Ed S and others at MSNBC asking that question w/no answer…on the Larry O show last night Debbis W Shultz came on and proclaimed the people have spoken with the elections of NY in that they want bi part for medicare “reforms” I smell Clinton brand of double talk with reforms meaning cuts…btw On Bloomberg coverage on the EQ today Obama was promising major debt reduction..
DC fakes the mad house; they know what they are doing.
Tangential– There is a contingent that understands the cartels, dishonesty and routine theft that characterizes the international financial system. The hedges have outrageous bets out that could take JP Chase Morgan down under certain conditions and that contingent is piggy backing off those we-make-money-at-far-higher-multiples-if-we-destroy-wealth hedge fund gamblers. More on the strategy here.
yeah, i think it looks like they do.
p.s. not sure about the jpm silver thing. only because i don’t know how to confirm or deny it. primary source material is beyond my reach.
i don’t watch tv, so i don’t know what was covered. are you saying peterson is not treated like the koch family? yikes! that’s just nuts.
it’s much worse than that, TCU! the fed govt doesn’t need tax revenue in order to spend! the whole deficit/debt thing is a big fraud. taxes are important, but not for the reasons we’re told. the layers of lies is like an onion. keep peeling and peeling only to find more layer to peel.
I think Pulitzer prize winning American political cartoonist Mark Fiore does a pretty good job of annihilating much of the lies and spin and his work is far more interesting and apparently very, very threatening to the status quo.
“Enchanted Financial Forest” (Aug. 25, 2010)
“Corporateland” (Jan. 26, 2011)
“Military Math” (Feb. 16, 2011)
“Disaster” (Mar. 16, 2011)
“Cut & Ruin” (Mar. 2, 2011)
fabulous links, thank you!
i just watched one of the fiore’s on broccoli budget cutting. brilliant!
I can see your viewpoint. There is info of their concrete actions in more than one commodities market. Check this out regarding COMEX and silver (Kitco.Com, Mar. 18, 2011). If I understand the dynamics correctly, their goose is cooked if the price of silver rises about their stock price. Also recall JPM’s relationship to the Fed to influence the paper money supply (another commodity) via “Quantitative Easing” plus their copper commodities position (here [WSJ.Com, Oct. 25, 2010] and here [Telegraph.Co.Uk, Dec. 4, 2010]). Yeah, it would be awesome to see the undisclosed deals the private equity firms/hedge funds (WSJ.Com, Feb. 2, 2009) are doing, wouldn’t it?
!De nada! I point to a Mark Fiore political cartoon and the light bulbs go on above people’s heads. It’s a great educational tool and I say use it to the max. Warren has the same knack for communicating the pith of an issue and the opposition is freaked enough for McHenry to attempt that pathetic ambush. There’s plenty of material this week so I’m looking forward to SNL.
mzchief, do you know how to contact mark fiore (or know someone who might)? i think mark and warren would make a great team and i’d love to see what mark might do after a tutoring session or two with warren.
http://moslereconomics.com/2011/05/26/former-president-clinton-on-the-debt-ceiling-issue/comment-page-1/#comment-53307
mzchief,
many thanks for the links! i’m a little buzy with a related project and don’t have the time to track down sources as i should (and like to).
“Doing Time” (a very timely critique of the California/US prison system; May 25, 2011)
That thought crossed my mind, too. I think it’s best to leave him a message here. Also check this out.
thanks. i’ll give leaving him a message a try (gotta first think about what approach might intrigue him enough not to just delete) — wouldn’t hurt to have more than one person try… hint, hint :)