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Front Group for Military-Industrial Complex Pushes Hard to Slash Social Programs and Avoid Pentagon Cuts

Corporate-backed lobbying group Fix the Debt shows little interest in protecting the neediest in society.

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Everyone knows that the U.S. also spends far more on defense than other countries. In fact, continuing this status quo and projecting American power abroad may be the only meta-policy the Washington establishment agrees on—which is why Mitt Romney was attacked by Republicans for his premature acerbic response to the killings of four American diplomats in Libya.   

But there are recent signs, PAI said, of “a growing consensus” in Washington that the Pentagon could absorb budget cuts of half a trillion dollars over the next decade, citing a defense industry blog in The Hill, a congressional newspaper, that focused on a report by several defense industry think tanks.

“Researchers at NSN surveyed disparate proposals for Pentagon spending reductions drafted by Project on Defense Alternatives, Center for a New American Security, Center for American Progress, the Stimson Center, RAND Corporation and the Project on Government Oversight,” The Hill blog said. “When averaged in total with the other recommended reduction levels proposed among the remaining think tanks surveyed, the final figure comes to $510 billion.”

One reason defense cuts are not on the negotiating table is that Fix the Debt leaders do not only sit on the boards of military contractors, PAI’s report said, but some are paid lobbyists for those firms. “Steering committee member Jim McCrery, characterized as a former member of Congress on Fix the Debt’s website, is a lobbyist for GE, Chevron, and several other companies with defense contracts,” it said.

“Vic Fazio has lobbied in 2012 for some companies with defense contracts, such as Dow Chemical, though the companies’ contract amounts are relatively minimal,” PAI’s report continued. “Fazio also lobbied on behalf of Corrections Corporation of America (CCA), a private prison company, which has insignificant defense contracts but $380 million in DOJ and DHS contracts in 2012.”

Other Paths to Long-Term Solvency

There have been innumerable reports about how Congress could easily solve the Social Security piece of the so-called debt crisis without changing the cost-of-living index—but, of course, they all require wealthier individuals to pay more. As Joshua Holland writes in The Fifteen Biggest Lies About The Economy, the doomsday projections about Social Security are all based on worst-case scenarios spanning decades. “Right now Americans pay Social Security taxes on the first $106,800 they earn,” he said. “Eliminating that cap would instantly close the ‘Social Security gap’ over the long run.”

Another “tax gap” of around $300 billion comes from owed but unpaid federal taxes—and not from individuals as much as businesses that have turned to using overseas entities to avoid domestic tax liabilities. Holland quotes David Cay Johnson, an ex- New York Times tax reporter whose books discuss the off-shoring trend (equal to 25 percent of corporate earnings in 2009) as well as delaying payment of tax bills, so-called deferrals, which Johnston called “one of the major tools for redistributing wealth upwards.”

Doomsayer in Chief Peter Peterson

Another notable facet behind Fix the Debt coalition is the presence of Michael Peterson on the board. He is the president of a foundation founded by his father, Peter Peterson, a former U.S. commerce secretary under Richard Nixon and co-founder of the Blackstone Group, a private equity firm that made a fortune in the hostile takeovers in the 1990s. Peterson put $1 billion of his own money into the Peter G. Peterson foundation, and has single-handedly bankrolled the war of ideas on the debt crisis, Holland writes.

“The agenda of Peter Peterson and his ilk,” wrote [Center for Economic and Policy Research Co-Director Dean] Baker in 2009, “never had anything to do with generational equity. The point was always to gut Social Security and Medicare. These programs stand out as key targets precisely because they are hugely effective and popular.” What’s remarkable is how successful Peterson has been in obscuring his agenda in a cloud of supposedly sensible bipartisanship.