Pete Peterson bankrolled debunked austerity study, could make billions off safety net privatization

[HomerRamone]

The dirty secret behind right-wing austerity

http://www.thomhartmann.com/blog/2013/04/dirty-secret-behind-right-wing-austerity

The motivation behind the world-wide economic con of austerity has been discovered. And, the source is none other than Pete Peterson – the debt-obsessed billionaire who stands to make billions off the privatization of our social safety net. Just days ago we told you how a 28-year-old grad student debunked the Reinhart-Rogoff study used to push austerity throughout the world. Well, now we know why Republican “fuzzy math” was used in the first place. Pete Peterson's organizations bankrolled that study.

Kenneth Rogoff, one of the study's leading authors, is a member of the Advisory Board at the Peterson Institute, which published the pro-austerity study. And, Carmen Reinhart is a regular participant of Peterson Institute functions, along with the likes of Paul Ryan and Alan Simpson. While the now-debunked study's math might have been written off as a mere error by the authors, the link to Peterson indicates that ideology, rather than incompetence, is the cause.

The austerity-induced human suffering and economic destruction should have been evidence enough for democrats to stop believing in budget-cut myths. But, the link to Peterson proves that “high debt causes slow growth” theory is nothing more than right-wing manufactured hysteria. Peterson and the corporatist machine have created this problem, and the so-called solution, to perpetuate the myth that government spending – not historically low tax revenue – is the real problem. And they have even gotten democrats to believe it.

It's time for President Obama and Democratic leaders to see the writing on the wall and take a formal stand against austerity. No nation, in the history of the world, has ever cut it's way to prosperity, and no fabricated economic study can change that.

[jsr]

1. He's the guy behind the curtain

http://www.sourcewatch.org/index.php/Peter_Peterson

[SharonAnn]

48. You knew he was planning to make money of it. That's his only reason for

doing this. He's not concerned about the debt and all that. He just sees that there's money somewhere and he wants it.

Lik Matt Taibbi's characterization of Goldman Sachs as "A giant vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money."

[JHB]

61. It's not JUST the money, for him. At 87 years old there's no way...

...he'd recoup everything he's sunk into think tanks and astroturf efforts.

He's been beating this drum since the 70s, and it's always the same tune no matter how conditions change. In his articles in the New York Review of Books in 1982 warning of a coming SS crash, he told of how Social Security was set up during the depressions, when conditions were very different: back then few people had pension plans, while 'now' (meaning 1982) over half did and they were well-funded. In 2013, with those pensions gutted by union-busting and looting by private equity firms like Peterson's Blackstone Group, the argument is that "Social Security was never meant to be a complete retirement plan".

I like a quote from John Hess (from 1997) about Peterson:

If opinion-makers consider Peterson an expert on finance, experts on finance tend to consider him more of an opinion-maker. Ken Auletta's book Greed and Glory, about the near collapse of Lehman Brothers in the 1980s, describes Peterson as, in the eyes of his partners, an arrogant bungler dying to make killings in leveraged buyouts, an obsessed reactionary, a name-dropping snob and, all told, so much a pill that his partners paid him $18 million to get rid of him.

Now to return to the question with which we began: How does Peterson find the time to make all that money? It would seem to be the new-fashioned way of tapping the gusher of wealth flowing from the economy. Peterson took his severance pay to Schwartzman and formed the Blackstone Group, which played the arbitrage game, bought up failing companies, shopped the savings-and-loan auctions, and made money.

A towboat operated by one of their subsidiaries and piloted by a man who had flunked his licensing exam seven out of eight times hit a railroad bridge and caused 47 deaths. Another Blackstone company drilled a hole in the Chicago River and caused that city's costliest disaster since the Great Fire. A major partner resigned last October under the cloud of an ugly scandal alleging fraud.

These things happen. Peterson is a busy man. Journalists may be forgiven for not connecting him with these misfortunes, or even knowing about them. What is not forgivable is their swallowing his ideological book, line and sinker.

http://fair.org/extra-online-articles/a-crusader-in-clover/

[Bannakaffalatta]

2. See what happens when the whole world lives inside an old joke?

Devoted husband comes home early to find his wife in bed with his best friend. The wife adamantly denies being unfaithful. "But," say the husband, "I saw it with my own eyes." Wife says, "Who do you believe, Harry, me or your eyes?"

So, why do government and media routinely believe economists over mathematics?

ETA, in light of that picture - what good does he think it will do him to kick a bucket full of other old people's money?

[bahrbearian]

9. He , who dies with all the money wins.

[sendero]

3. It boggles the mind..

.. how the rich have bought off everything, academics, the media, the politicians.

[jsr]

4. But we still have freedom

to vote for either the red team or the blue team.

[sendero]

6. Hey now wait a minute..

... the blue team really is better on social issues, but if it has to do with business or money, yeah, pretty much a wash.

Red team blatantly goes after everything the 99% have, but large numbers keep voting for them. Blue team earnestly but completely ineffectually (so much so as to not even look like a credible effort) rails against them, putting up a speed bump here and there.

Cynical? I just watched 5 years into the worst economic calamity since the GD, and apparently there is not one damned thing we can do about it and damned little we can do to stop if from continuing forever.

[truebluegreen]

7. +1000 nt

[HomerRamone]

10. People need to grind the machine to a halt together

instead of competing for the few spaces on the lifeboats (to mix metaphors)

[rhett o rick]

19. Actually it's a genius of a strategy.

The red team has carte blanch to rape and pillage, the blue team strongly resists the red team on social issues. These are the issues that people closely identify with. But while we are watching the dog fight over gun control for example, both the blue and red teams are picking our pockets. Now some will rationalize that at least the blue team is helping us win some of the social dog fights and when they take our wallets they dont hit us in the head with a lead pipe, so it could be worse? Yes but when you get home and find your wallet is gone, your house is gone, your job, retirement and Social Security are gone, your freedom will soon follow. Then all the hard work for social issues will quickly be flushed down the fascist toilet.

When do you think the next bank bailout will occur? I'm think around 2015.

This opinion is provided free of charge with a money back guarantee.

[SCVDem]

31. Freedom?

" Yes but when you get home and find your wallet is gone, your house is gone, your job, retirement and Social Security are gone, your freedom will soon follow."

You kinda miss the point.

After all the rest are gone, commiting a crime to go to jail is actually an upside.

For the elderly they will have a bed and meds.

Freedom isn't squat when you're hungry, sick, cold and living in fear under a bridge.

The perfect analog to North Korea, except their entire country is the prison.

[ctsnowman]

60. Exactly.

[TheMadMonk]

51. How so? THIS Blue Team has offered up and handed over unasked, that which...

...the last Red Team would not have dared ask for.

Just why the fuck should the Red Team do anything but cross it's arms and ask: "What else have you got?"

As far as the Red Team is concerned, matters like gays in the miliatry, marriage equality, abortion, even guns are highly convenient distractions. They are all matters the Red Team expects to ultimately lose on, whilst always "fighting the good fight" and keeping the populace properly polarised.

Look at the difference between law and reality for non-whites in the US (and not a few white minorities), for women, for non-Christians, the poor, the disabled and the mentally ill.

There is a huge gap between theory and practice, and the Red Team uses every damned trick in the book to exploit that gap, whilst the Blue denies it's bloody existence.

[Dustlawyer]

20. That's just it, we are all supposed to treat our 2 parties like teams so we will get carried away

in hyper partisanship and overlook the things our team is doing that we do not like. The power brokers don't care which one we root for b/c they win either way. We have all been watching a Harlem Globetrotters vs. Washington Generals game! We need COMPLETE CAMPAIGN FINANCE REFORM to get back our Representative Democracy back! We need to break up the oligopolies, especially the media. All of Washington is compromised, yes, even Obama!

[juajen]

33. Then, imho, we all should just stop voting. What good does it do?

Maybe then, our disgust with both parties will be obvious and they will have to prove we are actually a democracy. Ha! I am not normally pessimistic, but I am very tired of polls, letters to congressman who don't pay any attention and the robbing of the middle class and poor that is destroying our economy to benefit the rich. No picketing or marches anywhere have made a difference in a long time. I am disgusted.

[Dustlawyer]

42. I agree to the extent that it will take a HUGE number of people marching and holding out

and massive support from people of both parties! Not likely anytime soon. I am doing what I can by adding my voice here. I used to work with the unions on campaigns but I do not see anyone worthwhile of the sacrifice of time and money. It is because I am fed up that I quit the Democratic Party. Unless something changes soon though, us Lemmings will be to far over the cliff to prevent Global extinction due to climate change.

[WHEN CRABS ROAR]

43. A good general strike would work

but that would require an educated and aware majority of the population, something that is sorely lacking at this time.

[Overseas]

8. K&R. I certainly hope they all stop pretending austerity is the answer.

[Triana]

11. Yep. I've posted about this bastard and his Simpson-Bowles cohorts before...

...http://www.democraticunderground.com/1017111963

&feature=player_embedded

MUCH more about Peterson's "Fix the Debt" here:

http://www.sourcewatch.org/index.php/Portal:Fix_the_Debt <--- on this page, scroll down to "Fix the Debt's Leadership Table" - two of the first few names on the list are ALAN SIMPSON and ERSKINE BOWLES.

We needn't believe that Obama isn't aware of this organization or its objectives when he appointed these two to his Catfood Commission. He certainly was. After Obama himself has suggested needlessly cutting SS - he no longer gets the benefit of the doubt from me. There IS NO DOUBT that Obama supports this organization ("Fix the Debt&quot and its objectives.

[mountain grammy]

12. Gee, really? It's just the old saying:

You can't be too rich or too evil... I think it's something like that.

[cantbeserious]

13. Yes- Always Follow The Money - Who Stands To Gain - Who Stands To Lose

eom

[Triana]

14. Forbes article about these "Fix the Debt" schmucks....

The Great American Retirement Scam: Why The Wealthiest CEO's In America Want To Take Away Your Social Security

. . .Meet the “Fix The Debt” gang—a collection of more than 80 of the nation’s most powerful and wealthy CEO’s who have generously committed their time, money and lobbying efforts to contribute a solution to the nation’s debt crisis in the effort to avoid an economic disaster. And what do these great Americans have in mind as the recipe to cure our national ills?

A plan that leaves it to the poor and middle-class to pay off our burgeoning debt through the scaling back of Social Security, Medicare and Medicaid.

Certainly, there is nothing particularly new about the notion of the 1 percent looking to entitlements as the solution to debt, but these clever executives have added a few wrinkles to the plan that are well worth noticing as these corporate leaders are not simply content to simply lay the debt on the shoulders of those least able to bear it—they intend to make billions in the process.

Their proposal comes complete with ideas ranging from granting themselves some sweet tax breaks via a change in the tax laws that would allow their companies to return overseas profits to the US tax free—instantly dropping some $134 billion to their companies’ collective bottom line—to a well buried benefit that will earn them billions as a direct result of modifying Social Security to delay benefits to the millions who will suffer.

And all of this—they would have us believe—is in the interest of serving their country.

THE REST:
http://www.forbes.com/sites/rickungar/2012/11/28/the-great-american-retirement-scam-why-the-wealthiest-ceos-in-america-want-to-take-away-your-social-security/

[ctsnowman]

63. Thanks Triana.

[ruffburr]

15. I can't fathom-

The pure EVIL of Mr. Peterson and his cohorts, How on this earth do these people live with themselves? It's beyond me,

[AnnieK401]

16. Why does this come as no surprise.

Pete Peterson, hmmm

[forestpath]

17. This is the kind of monster Obama pays attention to.

[JDPriestly]

22. May I remind everyone that Pete Peterson headed the committee that picked Timothy

Geithner to head the NY Fed. Geithner should have blown the whistle on the Wall Street fraud. He didn't. Our economy tanked, thanks in part to Timothy Geithner's either incompetence or dishonesty.

Never mind. Obama forgave the Geithner and appointed him to head the Treasury Department.

Guess who was in charge of managing the Social Security Trust fund during Obama's first four years as president?

Yes. Timothy Geithner. Managing the Social Security Trust fund is part of the job of the Secretary of the Treasury.

A wicked net has been woven.

[forestpath]

25. Birds of a feather.

[duffyduff]

52. He is one of the puppet masters pulling Obama's strings. n/t

[Snarkoleptic]

18. Pete is an 86 year old billionaire who feels fucking the little guy over

is a journey rather than a destination.

For fucks sake Pete, you've won the game. It's time to retire and stop the obsessive/compulsive fucking over of the proles.
What a demented, sociopathic fuckstain.

sorry for the mini-rant

[duffyduff]

53. You're being kind.

Peterson is one of the most evil people alive today.

He can't die soon enough for me.

[ctsnowman]

62. sorry for the mini-rant

Please don't apologize. I need to know there are people out there like you (and me).

[popsdenver]

21. We Are Sooooooo

WASF

[JDPriestly]

23. Meet Pete Peterson per Wikipedia.

Peter George "Pete" Peterson (born June 5, 1926) is an American businessman, investment banker, fiscal conservative, author, and politician whose most prominent political position was as United States Secretary of Commerce from February 29, 1972 to February 1, 1973 serving under Richard Nixon. He is currently best known as founder and principal funder of The Peter G. Peterson Foundation, which he established in 2008 with a $1 billion endowment. The group focuses on raising public awareness about U.S. fiscal-sustainability issues related to federal deficits, entitlement programs, and tax policies.[1]

Before serving in the White House, Peterson was Chairman and CEO of Bell & Howell, from 1963 to 1971. From 1973 to 1984 he was Chairman and CEO of Lehman Brothers. In 1985 he co-founded the private equity firm, the Blackstone Group. Peterson was Chairman of the Council on Foreign Relations until retiring in 2007, after being named chairman emeritus. In 2008, Peterson was ranked 149th on the "Forbes 400 Richest Americans" with a net worth of $2.8 billion.

Peterson founded the Blackstone Group, which went public in 2007. He has been named the most influential billionaire in U.S. politics.[2]

http://en.wikipedia.org/wiki/Peter_George_Peterson

If you want a good laugh, look at the picture of Peterson posted on Wikipedia. It may not be Peterson's fault, but he looks very young. He was born in 1926. The Wikipedia picture has to be from the Nixon era.

You'd think Peterson, with all his pull, would get Wikipedia to update his photo.

[avgjo]

32. Is this the same Blackstone Group which is buying up foreclosed single family homes? nt

[JDPriestly]

38. Apparently.

http://www.bloomberg.com/news/2013-01-09/blackstone-steps-up-home-buying-as-prices-jump-mortgages.html

[DallasNE]

57. Paul Krugman Is Certainly No Fan Of Pete Peterson's

And here is a sample. It starts out talking about Starbucks but uses that later to show that it is just part of the bait and switch deception Pete Peterson is famous for. http://www.nytimes.com/2012/12/31/opinion/krugman-brewing-up-confusion.html?smid=tw-NytimesKrugman&seid=auto

[WinstonSmith4740]

71. I don't know...

You'd think Peterson, with all his pull, would get Wikipedia to update his photo.

I think we're talking vanity here. That picture HAS to be from when he was Nixon's Sec. of Commerce. This guy is 87 now, and after reading his bio, he's somewhat of a mystery to me. How can you be married to the founder of Sesame Street, and do quite a bit of philanthropic work, and be such a dick?

[Turbineguy]

24. Hostis Publicus

We used to do something about people like that.

[fasttense]

26. Austerity - just a more cruel and vindictive form of capitalism

Who loans our federal government money? Not you and me. We don't have enough to loan to our government. But people like Pete Peterson and the Koch brothers do. So, they want to use your Social Security money to make sure they get paid back with interest. Hell, that's why they bought off all 3 branches of our government, so they could make sure they get their money back and the workers stay starving and miserable. Starving and miserable workers, even when they are suppose to be retired, don't talk back and do what they are told. All brought to you by capitalism, an economic system that would shrivel up and die if workers didn't support it with their labor, yet a system that rewards those who don't do the work.

Communist China also loans us tons of money. So, every time you pay your federal taxes, you are supporting Communist China. And China thanks you for it.

[juajen]

35. The American people are owners of most of the US Debt.

Yep, you and me. China is way down the list. I believe we might owe them around 1 Trillion, but our government owes the american taxpayers, the 99% around 13 trillion.

I just say the pie chart a few weeks ago, but can't remember where. I was shocked. I had bought into how much we owed China; so, of course, we have to give up so much to repay China, Bullshit!

I am 71 and not the most adept at researching something I just read. Perhaps one of you can help this elderly widow and find this pie chart. IMO, it should be first page always. I am tired of this meme. We spent more on the Iraq war than we owe China. Stop buying "stuff" made in China. I try my best to follow that advice, so only get fooled when something slips by.

For instance, Cold Water Creek clothing is all made in China. I have stopped buying from them. If you read "imported" and they don't say from where, it's a pretty good bet that it is made in China. I know we all need to save money, but we can do this. Most of it is cheaply made and will wear out much faster or break a few months after. So we are not really saving money.

In addition to ruining our economy, the Chinese are horrible to their people and factories are dangerously run with child labor. No wonder all our greedy old men want the Chinese and some other countries to make our goods. No f**king rules!

[raouldukelives]

65. If only it were just greedy old men, it's everyone in Wall St.

Each a small part of the ownership, each gleefully donating labor & money to profit themselves from the horrors inflicted upon ourselves, our neighbors and our natural world.

I am in complete agreement with you. We can shop second hand if nothing else. I've been lucky enough to pick up clothing second hand that although old is of far superior quality and durability than anything I can buy today. Keeps me warm, keeps my feet dry and doesn't involve supporting regimes or corporations I have no desire to align myself with. No matter how profitable it may be.

[arthritisR_US]

27. Freaking greedy billionaire pigs

[Auntie Bush]

37. There isn't one billionaire in this world that worked for their money.

I actually believe they got it through some kind of dishonest method where people along the line were screwed.

[arthritisR_US]

59. Cheating and exploitation would be my tacit assumption.

Pigs, all of them, pigs!

[Oilwellian]

28. It's time to focus on this man as we have the Koch Brothers

He's definitely one of the players behind the curtain.

K&R

[They_Live]

29. What can we do about it?

seriously. We need to do something.

[mindwalker_i]

30. That kind of explains why

when the math error(s) was/were found, R&R said if didn't change their outcome. The rest of us were, like, "Wha?! The analysis had a big-ass math error, the result, is completely different when said math error was found, but it doesn't change the outcome?" That's a sure sign that the outcome was meant to match ideology, not facts. The facts were picked only to support the outcome.

Republicans do this a lot. The Iraq was is a great example.

[sulphurdunn]

34. Parable of the Rich Fool

“The ground of a certain rich man yielded an abundant harvest. He thought to himself, ‘What shall I do? I have no place to store my crops.’

“Then he said, ‘This is what I’ll do. I will tear down my barns and build bigger ones, and there I will store my surplus grain. And I’ll say to myself, “You have plenty of grain laid up for many years. Take life easy; eat, drink and be merry.”’

“But God said to him, ‘You fool! This very night your life is required of you. Then who will get what you have prepared for yourself?’ (Luke 12:13-21)

Mr. Peterson is 87 years old and the clock is ticking.

[Spitfire of ATJ]

36. Some of these people had dreams of reversing ALL of FDR's New Deal under Ike...

Then Ike turned out to be someone who cared about PEOPLE over money and their hopes were dashed.

[HiPointDem]

39. +1

[Electric Monk]

40. k&r

[Faygo Kid]

41. Peterson is as dangerous as the Kochs

He is on a crusade to take our retirement from us. He's one guy I won't be sorry at all to see passing - hopefully sooner rather than later. He's that bad.

[duffyduff]

54. He's worse. He has the president of the United States and Congress wrapped around his finger. n/t

[surrealAmerican]

44. It's not a mistake, it's not incompetence ...

... it's fraud.

[moonbeam23]

45. As the great Gomer says:

SURPRISE SURPRISE SURPRISE

[madrchsod]

46. i`ll wait to see if obama says anything about this myth of austerity.

i think i`ll be in for a long,long wait....

[MannyGoldstein]

47. It doen't matter what "math" and "facts" say: this President stands firm.

He stands for something, he doesn't just spin like a weathervane when he turns out to be provably wrong.

It's time for you, and the rest of us, to make the choice: are you with God, or with Krugman?

[yurbud]

49. is there any idea too stupid or destructive that our politicians won't enact if the price is right?

[blkmusclmachine]

50. .

.

[Blue Owl]

55. So our belts are tightened to pay for corporate greed

Yeah, seems fair...

[DallasNE]

56. Follow The Money

Applies every time. And when the grad student debunked the report I instantly said the error was ideology related rather than incompetence. It means that Reinhart and Rogoff need to be viewed in the same light as Arthur Laffer and for the same reason. What they did was economic malpractice. With modern computers you can quickly and effortlessly go through a series of try this and try that until you get the result you are looking for and this is exactly what Reinhart and Rogoff did.

[mtasselin]

58. Obama

I hate to say it, but President Obama doesn't have it in him. He was elected to his second term and has no reason to take on this fight.

[Octafish]

64. Team Obama is leading the charge for Pete's Peterson's Austerity USA.

http://www.sourcewatch.org/index.php/Peter_Peterson

[marmar]

66. There's always someone waiting to profit on misery......

....... or as Chris Hedges says, there trying to take as much as they can as fast as they can before it all falls apart.

[eppur_se_muova]

67. Wow ! I can't wait to see this covered on the evening news tonight !

[JDPriestly]

68. This story was posted early Sunday. I want to kick it again. It is huge to my mind.

There can't be a story any more important than this for today. Unless it is the climate change story about the CO2 level. And that is a close call.

This story about Peterson and Reinhart and Rogoff should tell us what is wrong with our economy and our government. Rampant corruption.

Even our scholars, the very information we get, is corrupt.

[riverbendviewgal]

69. kick and rec

[WinstonSmith4740]

70. This is an old argument...

No nation, in the history of the world, has ever cut it's way to prosperity...

And it's been used by more than government. This is the EXACT argument my late husband used to have in business all the time. A much smaller scale, of course, but the dynamic is exactly the same. It's the classic "Accountants vs. Marketing". Bean counters always want to cut expenses. Always. "The salespeople are making too much money." Marketing knows if you want your company to grow, you need to throw a few of those beans out the window, where they will grow and produce (gasp!) MORE BEANS!!!

No president (except Obama, of course) has ever been expected to save his way out of a recession. It can't be done. Revenue MUST be increased. Instead of cutting public workers, more should have hired. I've always loved that "Government has never created a job" meme. I guess my dad spent 35 years panhandling in Philly.

We here at DU have known this stuff for years. We also know the rat bastard Republicans, who created this mess to begin with, don't want it fixed. Not by this president, anyway.