It’s debt ceiling time and the US economy is once again on the brink, held hostage by extremists hell-bent on forcing cuts to Medicare and Social Security.
Oh wait. That was last year.
In 2014, for the first time in three years, the vote to extend the nation’s debt ceiling did not bring the United States to the brink of default in a high-stakes game of slash and burn.
Last week, the House voted to raise the government’s borrowing limit until March 2015 without any conditions. In fact, if the Speaker had his way, he would have tied the vote to the repeal of cuts to military retirement pensions. The Senate concurred, sending a clean debt ceiling bill to the president’s desk.
It was a striking turnaround for the forces of austerity. One of the biggest losers? The Campaign to Fix the Debt, the $40 million AstroTurf austerity group, financed by Pete Peterson and other Wall Street big wigs, and fronted by Maya MacGuineas, Erskine Bowles and Alan Simpson.
Call it Alan Simpson’s last harrumph.
Fix the Debt Pushes America Towards the Fiscal Cliff
It wasn’t supposed to be this way.
In July of 2012, the Campaign to Fix the Debt was launched with a patriotic flair. It set a July 4, 2013 deadline for an austerity deal along the lines of the $4 trillion Simpson-Bowles plan. The austerity crowd had already succeeded in rigging the game, creating a December 31, 2012 “fiscal cliff” that would trigger steep budget cuts without a bipartisan deal. Now they were poised to take advantage of that deadline and other standoffs to secure a “Grand Bargain.”
The idea was that Democrats were supposed to trade cuts to earned benefit programs like Social Security and Medicare for a bit more tax revenue from the Republican side. The president, who had created and backed the Simpson-Bowles commission, appeared willing to make a deal.
With a stalled economy and public sentiment decidedly against cuts to these popular and lifesaving programs, Fix the Debt gathered the big guns. Over 100 CEOs were named to a council and many contributed to the $40 million budget. Fix the Debt CEOs descended on the White House and the Capitol building. The nightly news was filled with images of CEOs like Honeywell’s David Cote stepping up to the mike to opine about the need for belt-tightening and shared sacrifice.
To show “grassroots” momentum, Fix the Debt hired PR firms, had them set up phony state chapters, bankrolled the stunts of its youth group, The Can Kicks Back, which donned a foam tin-can suit (the AmeriCAN) for cute videos and hyped slanted numbers about “generational inequality.” America was going to rise up they said, they were going to get 10 million people to sign petitions.