By Dan Murphy
Not many of our readers know the name Pete Peterson, who passed away recently at the age of 91. But to many, Peterson is an American hero and patriot because of his efforts, which have failed recently, to get our leaders and voters to focus on the unsustainable path of borrowing and debt that our nation is on.
Pete Peterson was known as the most influential billionaire in U.S. politics, making his fortune on Wall Street and served as the secretary of commerce under President Nixon.
But his greatest contribution to our nation was in 1992 when he co-founded the Concord Coalition with Senators Paul Tsongas (a Democrat) and Warren Rudman (a Republican), a bipartisan group that calls for the reduction of the federal budget deficit. In 2008, he founded the Peter G. Peterson Foundation, which is devoted to spreading public awareness on fiscal sustainability issues related to the national debt, federal deficits, Social Security policy, and tax policies.
Both the Concord Coalition and the Peterson Foundation remain active today and continue to warn the American people about the reckless borrowing, deficits and debts we are leaving to our children and grandchildren.
“Pete Peterson saw the dangers of a mounting national debt and took on a seemingly impossible cause that no one wanted to face,” said Maya MacGuineas, president of the Committee for a Responsible Federal Budget, another nonpartisan, non-profit organization committed to educating the public on fiscal policy issues. “His leadership and wisdom made our nation stronger. He was simply the adult in the room – the conscience of our nation’s budget.”
Peterson’s son, Michael Peterson, continues the work of his father and the Peterson Foundation as its chairman and CEO. “For his entire career, and especially since the launch of his own foundation 10 years ago, my father dedicated his time, energy, passion and resources to solve the nation’s fiscal challenges and preserve the American dream that he was so fortunate to have lived,” he said. “He worked tirelessly and across party lines to build a sustainable fiscal foundation to support economic growth and widely-shared opportunity.
Peterson’s friend and co-founder of the Concord Coalition, former Sen. Warren Rudman, once said: “Pete Peterson cares about the debt because he’s a patriot. He truly believes in this country and the promise it holds for all its citizens and he wants to make sure that the promise will be there for future generations.”
Now that we understand and appreciate what Peterson and many others have been trying to get the American people to focus on regarding out nation’s fiscal future, the recent annual report of the Social Security and Medicare trustees shows how much closer we are to danger for American seniors in less than 10 years.
The report found that the retirement portion of the Social Security program will become depleted in 2034. At that point, the program would only be able to pay 77 percent of scheduled benefits; the disability insurance portion of Social Security will become depleted in 2032, and would only be able to pay 96 percent of scheduled benefits thereafter.
This year, the total cost for the Social Security program is anticipated to exceed total income (including interest) for the first time since 1982. Medicare’s hospital insurance program will become insolvent in 2026 and unable to cover all costs going forward – three years earlier than reported just a year ago.
“Social Security and Medicare are essential health and retirement security programs that are relied upon by millions of Americans,” said Michael Peterson. “Medicare’s largest program will become insolvent in 2026, just eight years from now and three years sooner than forecast just a year ago. Social Security will become insolvent in 2034, resulting in an immediate, across-the-board cut of 23 percent for all retirees. The drivers of these solvency challenges are well-known: an aging population and rising health care costs. Many solutions are available that could be phased in gradually and fairly. The report should be the latest wake-up call for our elected leaders, who have an obligation to reform and strengthen them for the long term, to take action.”
A recent poll conducted for the Peterson Foundation found that 65 percent of Americans say their level of concern about the National Debt has increased in recent years, including 70 percent of Democrats, 65 percent of Independents and 60 percent of Republicans. Moreover, Americans broadly are calling on the president and Congress to act, with 79 percent believing that lawmakers should devote more time to addressing the national debt.
“Voters continue to be concerned about our rising national debt, and rightly so,” said Michael Peterson. “Our nation is heading down a dangerous fiscal path, where the national debt eclipses the size of the entire American economy, and interest costs outpace investments in our children. Recent legislation has only made matters far worse.”
We ask our readers to join the Peterson’s call for fiscal sanity; if not for you then for your children and grandchildren, and for my daughter Katie Murphy, pictured with Pete Peterson.
