Portal:Fix the Debt/Key Findings

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Astroturf Supergroup

With 127 CEOs able to schedule meetings with President Obama and Congressional leaders, numerous PR firms lending a hand,[1] 80 staff,[2] multiple Peterson funded "partner" groups, and 23 phony state chapters, this incarnation of the Peterson message machine must be taken seriously. Fix the Debt documents say the group is targeting a budget of $60 million for the "first phase," [3] but in February 2013 Fix the Debt's spokesperson told CMD the organization had only raised $40 million so far. Fix the Debt engaged in a multi-million dollar paid ad campaign in the run-up to the so-called "fiscal cliff" and now is taking that campaign outside the beltway, which is "increasingly resembling a presidential race with grassroots style organizing and offices in places like New Hampshire and Ohio," writes Fortune magazine.[2] As of February 2013, group was touting it 345,000 members/petition signatures. That sounds impressive until one learns that a number of CEOs, such as the CEO of Caterpillar Inc., wrote to 130,000 employees encouraging them to sign [4]and one recalls that their goal was 10 million.[5]Learn more about the firms and the stunts behind the PR spin in the article "Pete Peterson's Puppet Populists" and the Fix the Debt Partners page.

Undisclosed Conflicts of Interest

Fix the Debt biographies fail to reveal that their core leadership team is riddled with conflicts of interest. Public Accountability Initiative (PAI) points to at least 13 steering committee members with financial ties to firms that lobby on deficit-related matters that are not disclosed in their glossy Fix the Debt bios. These firms lobby to preserve dozens of costly tax breaks (including the “carried interest” tax loophole that made Pete Peterson a rich man) or to hold off new taxes, such as the “Robin Hood Tax,” a proposed financial speculation tax that could raise as much as a $1 trillion over 10 years.[6] Click here to see a chart of these conflicts of interest and tax lobbying records.

Prominent CEOs Fail to Fully Fund Employee Pension Plans

While Fix the Debt’s 127 CEOs call for cuts to Social Security (a program that does not contribute to the deficit since it is has a surplus and is accounted for outside the federal budget), many of the publicly-traded Fix the Debt firms underfund their employee pension plans by some $103 billion making their employees even more dependent on Social Security.[7] The CEOs, of course, enjoy lavish retirement packages, averaging $9 million each, according to a study by the Institute for Policy Studies.[8] Click here to see a chart of CEO retirement assets vs. underfunded employee pensions (PDF).

The Real Corporate Tax Loophole Agenda

Many Fix the Debt firms pay a negative tax rate, which contributes greatly to the federal deficit. Worse, Fix the Debt firms are pushing for a "globally competitive" territorial tax system that would increase the debt by $1 trillion over ten years and encourage the offshoring of U.S. jobs, according to Citizens for Tax Justice.[6] This tax cut is not listed in their online goals and rarely spoken of explicitly, but it is mentioned on a slideshow buried on the group's website. The switch would not only add to the deficit, it results in a windfall of some $134 billion dollars for at least 63 Fix the Debt firms, including Google and GE, according to a report by the Institute for Policy Studies.[9] Click here to see a table of 10 top winners from a territorial tax system (PDF).

Many of the Firms Are Federal Defense Contractors

While Fix the Debt targets government programs for the middle class, 38 Fix the Debt leaders are tied to  companies with defense contracts totaling $43.4 billion in 2012, as PAI has documented.[10] Boeing (with $25.1 billion in defense contracts) and Northrop Grumman (with $8.5 billion) lead the pack. Boeing CEO W. James McNerney, Jr. is on Fix the Debt’s CEO Council, and Northrop Grumman board member Vic Fazio is on Fix the Debt’s steering committee. Click here to see a chart of the top six defense contractors with Fix the Debt ties (PDF).

  1. ↑ Virgil Dickson, "Burson's Proof unit launches Fix the Debt ad campaign", PR Week, November 16, 2012.
  2. ↑ 2.0 2.1 Anne VanderMey, "Fix the Debt isn't going anywhere", Fortune, January 30, 2012.
  3. ↑ Campaign to Fix the Debt, CEO Talking Points 10/2/12, organizational document, October 2, 2012.
  4. ↑ Carol E. Lee, "Morgan Stanley CEO Asks Employees to Press Congress on Fiscal Cliff", Washington Wire, November 27, 2012
  5. ↑ Amy Bingham, "The Fiscal Cliff: Congress’ Imminent Armageddon", OTUS, Jul 17, 2012
  6. ↑ 6.0 6.1 Citizens for Tax Justice, Why Congress Should Reject A “Territorial” System and a “Repatriation” Amnesty: Both Proposals Would Remove Taxes on Corporations’ Offshore Profits, fact sheet, October 19, 2011.
  7. ↑ Institute for Policy Studies, A Pension Deficit Disorder: The Massive CEO Retirement Funds and Underfunded Worker Pensions at Firms Pushing Social Security Cuts, organizational report, November 21, 2013.
  8. ↑ Institute for Policy Studies, A Pension Deficit Disorder: The Massive CEO Retirement Funds and Underfunded Worker Pensions at Firms Pushing Social Security Cuts, organizational report, November 21, 2013.
  9. ↑ Institute for Policy Studies, The CEO Campaign to ‘Fix’ the Debt: A Trojan Horse for Massive Corporate Tax Breaks, organizational report, November 13, 2013.
  10. ↑ Public Accountability Initiative, Operation Fiscal Bluff, organizational report, December 19, 2012.
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