Billionaire Pete Peterson

One of the big reasons that deficit hysteria gripped Washington for years despite dozens of more pressing issues is that Pete Peterson has spent the GDP of a small country propping it up. According to Joshua Green, Peterson spent half a billion on this current deficit push and plans to spend a half billion more.

The Simpson-Bowles commission was designed to short-circuit this reluctance by requiring Congress to vote on its recommendations if a supermajority of the commission endorsed them. To ensure the effort was fully resourced, Peterson—who has pledged to devote his $1 billion fortune to the cause of deficit reduction and told me he’s already spent $500 million—kicked in $800,000. In the end, a bipartisan majority—11 of the 18 members—voted for the recommendations, just shy of the 14 needed to compel congressional action.

Peterson has effectively created an entire industry around hyping the deficit. Plenty of money for countless consultants, think tanks, aids, speaking engagements, experts, and ad campaigns. A whole army of people to act as if cutting Social Security right now is somehow the most important thing in the world, despite all the evidence to the contrary.

There is not a grassroots desire for a grand bargain. There are only a few billionaires that spent a fortune trying to create one, but it keeps failing because it is so unpopular.

Unfortunately, the unemployed don’t have a billion to spend on a sustained lobbying campaign so their far more pressing issue is crowded out by this very well funded ones.