‘Fixing the Debt’ on Average Folks

Goldman Sachs’ Lloyd Blankfein and other tycoons behind “Fix the Debt” want average folks to expect less from Social Security and other safety-net programs but are doing all they can to protect their special interest tax breaks and dodge the slightly higher tax rates for the rich, note Bill Moyers and Michael Winship.

By Bill Moyers and Michael Winship

In Paul Krugman’s book, End This Depression Now!, the economist and New York Times columnist entitles a chapter “The Second Gilded Age” in which he describes the extraordinary rise in wealth and power of the very rich during this era of unregulated greed.

Since Ronald Reagan’s election in 1980, the top one percent of Americans have seen their incomes increase by 275 percent. After accounting for inflation, the typical hourly wage for a worker has increased just $1.23.

Big Money, as Krugman writes in his book, buys Big Influence. And that’s why the financiers of Wall Street never truly experience regime change, their cash brings both political parties to heel.

So it is that the policies that got us where we are today, in this big ditch of chronic financial depression, have done little for most, but have been very good to a few at the top.

But they’re not satisfied with having only most of it, they want it all. If Krugman were writing his book today, he could find plenty of evidence in the deal that supposedly kept us from going over the fiscal cliff.

Behind closed doors, Congress larded it with corporate tax breaks worth tens of billions of dollars, everything from tax credits for NASCAR racing and the railroads to subsidies for Hollywood, rebates for the rum industry and loopholes for off-shore financing that could help giant multinationals like General Electric avoid billions of dollars in corporate income taxes.

Writing in the conservative Washington Examiner, columnist Tim Carney says many of these expensive giveaways were “spawned by a web of lobbyists, donors and staffers surrounding Democratic Sen. Max Baucus of Montana,” chairman of the Senate Finance Committee. As we know from the Obamacare fight, Baucus is a connoisseur of revolving door corruption.

“Pick any one of the special-interest tax breaks extended by the cliff deal,” Carney wrote, “and you’re likely to find a former Baucus aide who lobbied for it on behalf of a large corporation or industry organization.” Even the pro-business Wall Street Journal was appalled. They called it a “Crony Capitalist Blowout.”

And so it was, and more. It was payback time for all those campaign donations. CEOs and lobbyists were tripping over themselves as they traipsed up and down Pennsylvania Avenue between Congress and the White House.

You’ve no doubt heard about Fix the Debt, that group of business execs and retired politicians taking out TV ads and campaigning to slash the deficit. In The New York Times, Nick Confessore reported, “close to half of the members of Fix the Debt’s board and steering committee have ties to companies that have engaged in lobbying on taxes and spending, often to preserve tax breaks and other special treatment.”

Get it? They’re privately protecting their interests as they publicly urge austerity on everyone else.

Lloyd Blankfein, CEO and chair of the global investment giant Goldman Sachs, is on Fix the Debt’s Fiscal Leadership Council. Here’s what he said when asked by CBS News’ Scott Pelley about how he would reduce the federal deficit:

“You’re going to have to undoubtedly do something to lower people’s expectations, the entitlements and what people think that they’re going to get, because it’s not going to, they’re not going to get it. Social Security wasn’t devised to be a system that supported you for a 30-year retirement after a 25-year career. In general, entitlements have to be slowed down and contained.”

Yes, but Blankfein and Goldman Sachs make sure their entitlements aren’t touched! Here’s the story: After 9/11, Congress created tax-exempt Liberty Zone bonds to help small businesses rebuild near Ground Zero. Turns out Goldman’s friends in high places consider it a small business, too, although it made $5.6 billion in profits last year.

As the fiscal cliff fiasco was playing out over New Year’s Eve, faster than the ball dropped in Times Square, a deal was struck that will extend the subsidies for Goldman’s fancy new headquarters in lower Manhattan. In their 43 stories of glass and steel, and a footprint two city blocks long, Goldman Sachs reigns supreme thanks to a system rigged by and for the powerful rich.

And then, according to The Wall Street Journal, just before the fiscal cliff deal’s higher individual tax rates kicked in, Goldman handed “Lloyd Blankfein and his top lieutenants a total of $65 million in restricted stock”, bonuses awarded a month earlier than usual so they could all beat the coming tax hike from which they have been spared for more than ten lucrative years.

It won’t surprise you to learn that, “Corporations announced more special dividends last month than in any other December since at least 1955.” Doing everything they can to avoid helping pay off the debt their CEOs have been urging Congress to cut.

As for working people, tough luck. Because the fiscal cliff deal ends the cut in payroll taxes, the average worker this year will take home about a thousand dollars less.

Bill Moyers is managing editor and Michael Winship is senior writer of the weekly public affairs program, “Moyers & Company,” airing on public television. Check local airtimes or comment at www.BillMoyers.com.

7 comments for “‘Fixing the Debt’ on Average Folks

  1. Dr. Janesh
    January 15, 2013 at 13:00

    Perhaps the financial-political elite will soon lose the ability to keep themselves in the gene pool…..anything can happen
    as we have seen in the past 20 years. They are not a permanent feature of this culture….who knows how their parasitic
    nature will lend itself to extrmination, who knows ?

  2. delia ruhe
    January 14, 2013 at 05:38

    What I would like some smart economist — say, Joe Stigliz — to do is add up all the money lost by ordinary Americans who forfeited their jobs, their homes, and their 401(k)s since 2008. Then we can talk about “shared sacrifice.”

  3. Hillary
    January 13, 2013 at 11:07

    ‘Fixing the Debt’ on Average Folks—
    What chance did the “Average Folks” have with Zionists like Paul Wolfowitz as deputy defense secretary , John Bolton as undersecretary of state , Stephen Cambone as head of the Pentagon’s Office of Program Analysis and Evaluation , Eliot Cohen and Devon Cross as members of the Defense Policy Board , Lewis Libby as chief of staff to Vice President Dick Cheney and 9/11’s Dov Zakheim as comptroller for the Defense Department in such high places.
    Trillions of Taxpayer $$$’s to carry out a PNAC agenda ? No problem ?
    Purveyors of lies ,deceit, torture, hegemony, theft and murder continue to keep an ignorant population “CALM”while its blood ,treasure and reputation is wasted and a President takes the country’s image and reputation to new lows.
    Any intelligent observer will lament this very dark but whitewashed period in American history.

  4. Andy D.
    January 12, 2013 at 17:58

    “Social Security wasn’t devised to be a system that supported you for a 30-year retirement after a 25-year career.”

    What the hell is he talking about?!! Assuming a working life spanning age 18 to 65, that’s 47 years. That’s a hell of a lot more than 2 5years. This is the kind of grossly inaccurate characterizations that are glossed over and accepted by unthinking right-wingers along with lumping SS and Medicare with “entitlements”.

    • F. G. Sanford
      January 12, 2013 at 23:47

      Thanks, Andy – you point out a common misrepresentation deliberately and frequently used to discredit what we should consider our “economic civil rights”. A famous mathematician pointed out this kind of deception which uses numbers to in order to confuse the issue. This tactic relies on what he called “innumeracy”, the tendency to be deceived by numbers because most people are not skilled at thinking in those terms.

    • Paul G.
      January 14, 2013 at 05:13

      Don’t know what Blankfein is so worried about as the life expectancy in the US has been declining and is behind many of the other “advanced” economies. ” Even the best-off Americans – those who have health insurance, a college education, a high income and healthy behaviour – are sicker than their peers in comparable countries, says the report by the US National Research Council and the Institute of Medicine”. Check out the report, “US Health in International Perspective: Shorter Lives, Poorer Health”, for a view of how rotten the US has become. Not only is the physical infrastructure falling apart; the human infrastructure is too.

  5. michael motley
    January 12, 2013 at 15:53


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