Bowles-Simpson a Distraction for Fiscal Cliff
The government has implemented a wide array of policies over the last three decades that have led to a massive upward redistribution of income. As a result, most workers have seen little benefit from the economic growth over this period.
Not surprisingly, the wealthy people who have benefitted from the policies that have redistributed income upward, for example NAFTA-type trade deals, Wall Street bailouts, and anti-union labor policies, don’t want the public talking about them. This is why we have the Erksine Bowles and Alan Simpson speaking tour.
For those who somehow have missed it, Morgan Stanley director Erskine Bowles and former Senator Alan Simpson were the co-chairs of President Obama’s 2010 deficit commission. While they were unable to produce a report that had the support necessary to win approval from the commission, they have made a career out of promoting their own proposal which they misleadingly imply was a report of the commission.
A Traveling Cash Cow
According to the New York Times, Bowles and Simpson get $40,000 each for speaking engagements where they push their agenda. This price tag tells us everything we need to know about what is going on here.
While $40,000 might not be big money among the people with whom Mr. Bowles and Mr. Simpson socialize, it sure is to the rest of us. This is a couple of thousand dollars more than the typical worker earns in a year. It is a bit less than three times the average annual Social Security benefit. And Bowles and Simpson get this money for spending an hour or so giving their tirade about the desperate need for reducing the deficit.
The incredible irony of these sorts of fees is that the substance of the Bowles-Simpson tirade is that paying for Social Security and Medicare will bankrupt our children and grandchildren. The two of them are running around the country telling people that Social Security checks to retirees that average $15,000 a year and providing health care insurance to seniors who have spent their lives working will have our children and grandchildren living in poverty.
Behind the Fees
To sell this line, Bowles and Simpson must be betting that they have some really poorly educated young people in their audience. If they learned their grade school arithmetic, they would quickly recognize these two for the hucksters they are.
The Social Security Trustees project that real wages, that means the growth in wages after adjusting for inflation, will grow on average by more than 40 percent over the next 30 years. This means that if a typical worker is making $38,000 in 2012, then a typical worker would be earning more than $53,200 in 2042, in today’s dollars.
The full article originally appeared here at Yahoo Finance.