Koch-Funded Network Jumps To Defend Billionaire Brothers Against Democratic Attacks

Huffpost Politics

Paul Blumenthal 

 

 

Koch-Funded Network Jumps To Defend Billionaire Brothers Against Democratic Attacks

 

 

Posted: 03/28/2014 6:42 pm EDT Updated: 03/28/2014 6:59 pm EDT 

 

• Elections 2014 David Koch Senate Majority Pac Koch Brothers Americans for Prosperity Charles Koch 2014 Election Public Notice Dark Money Campaign Finance Politics News

WASHINGTON -- A nonprofit group funded by Charles and David Koch to promote the reduction of national debt and government spending has been pressed into service as a defender of the billionaire brothers, who have come under attack by Democrats for plowing millions into conservative causes.

Public Notice, a Koch-connected, Washington-based nonprofit organized as a limited liability corporation with 501(c)(4) tax status, sent opposition research on Senate Majority PAC, a super PAC supporting Democratic candidates, and the candidates the group supports to reporters on Friday. The research said Senate Majority PAC's attack on the Koch brothers as out-of-state billionaires was hypocritical, since Senate Majority PAC is funded by billionaires from California and New York.

Public Notice's move into opposition research suggests that the full network of nonprofits funded by the Koch brothers and their allies may be deployed into the brothers' political battles. Democratic candidates in this year's elections and their backers, including the Senate Majority PAC, have begun fierce attacks directly aimed at the publicity-shy brothers in recent weeks, portraying them as un-American villains whose massive spending is ruining the political process.

Public Notice hadn't before publicly engaged in direct political activity or targeted specific Senate campaigns. Its involvement in opposition research on Senate candidates and super PACs appears to be a change in tactics to help the broader fight waged by the lead Koch group, Americans for Prosperity, which has spent at least $25 million on television and radio advertising in Senate races in the past year.

A Public Notice spokesman didn't respond to a request for comment.

Public Notice, founded in 2010, had been exclusively focused on promoting the reduction of the national debt and slashing discretionary government spending, and spending on safety net programs like Social Security and Medicare. The organization also has pushed to repeal Obamacare and block increases in the federal debt limit. Most of these efforts involved paid television advertising and social media targeted at young people.

Like most Koch-connected groups, Public Notice is organized as a confusing string of limited liability corporations, disregarded entities and nonprofits, obscuring the undisclosed "dark money" it accepts. At the top of its organizational structure is a disregarded entity called POFN LLC. Public Notice is legally registered as SGC4 Trust, but operates under the name Public Notice. The group also operates a 501(c)(3) educational nonprofit called Public Notice Research & Educational Fund.

The structure of the Koch political network has been detailed by the Center for Responsive Politics, The Washington Post and ProPublica. The tax forms referenced below were all accessed through CitizenAudit.org.

Freedom Partners Chamber of Commerce, the central node in the Kochs' political money network, was the main source of funds for SGC4 Trust, the group operating as Public Notice, in 2012. Freedom Partners provided $5,466,250 to Public Notice from Nov. 2, 2011, to Oct. 31, 2012. According to Public Notice's tax forms covering the period May 1, 2011, to April 30, 2012, Public Notice raised $5.9 million.

During this period, Public Notice also received $1.67 million from TC4 Trust, another Koch-linked nonprofit acting as a grant-making bank for other nonprofits. The TC4 Trust contribution came during a period from July 1, 2011, to June 30, 2012.

From May 1, 2010, to April 30, 2011, Public Notice received funds from TC4 Trust and another grant-making Koch-linked money bank, Center to Protect Patients Rights (now called American Encore). During this period, TC4 Trust sent POFN LLC $7.3 million while CPPR provided $711,000. Public Notice raised $11.9 million during this period.

The links between the Koch world and Public Notice do not end with funding. Public Notice's sole trustee and director Gretchen Hamel previously worked as program leader for TC4 Trust, the Koch-linked group that has been the largest funder of Public Notice. Hamel's employment at TC4 Trust was reported on tax forms covering the period Aug. 28, 2009, to June 30, 2010. Public Notice's first tax form states that the organization began operations on May 1, 2010.

Other Koch-linked groups that had mostly been on the sidelines of political fights are now getting involved. According to the Sunlight Foundation's Political Ad Sleuth, American Encore, previously CPPR, has purchased time on Minnesota airwaves to run an advertisement targeting Sen. Al Franken (D-Minn.) for his support of IRS rules cracking down on excessive political activity by nonprofits like American Encore.

CPPR had previously advertised on health care issues. But it hadn't run advertisements mentioning specific members of Congress, nor did its affiliated group, the Coalition to Protect Patient Rights.

Koch Brothers Meet Again to Prep for "Mother of All Wars"

Mother Jones

Political MoJo

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→ Corporations, Dark Money, Elections, Money in Politics, The Right

Koch Brothers Meet Again to Prep for "Mother of All Wars"

—By Gavin Aronsen

| Fri Feb. 3, 2012 4:00 PM GMT

 

 kochmbmproductions/YouTube; Globe Photos/ZUMA

Last week, the billionaire industrialist Koch brothers held their latest get-together with wealthy conservative political donors. At these meetings, held twice a year under a veil of secrecy, Republican all-stars discuss election strategy and vet potential presidential candidates like New Jersey Gov. Chris Christie. Last September, Mother Jones obtained exclusive audio recordings from a Koch seminar held outside Vail, Colorado, where Charles Koch had declared that the 2012 election would be "the mother of all wars" and thanked dozens of million-dollar donors who'd pledged to the cause.


According to a Huffington Post source, 250 to 300 guests attended the most recent event, which was held in Palm Springs, California. They included Citadel CEO Ken Griffin and casino billionaire Sheldon Adelson, who along with his wife has given a staggering $10 million to a pro-Newt Gingrich super-PAC. Guests reportedly pledged a total of $40 million to the effort to oust Obama, with Charles and David Koch promising an additional $60 million. But it wasn't all fun and games, the source said, as guests complained that recent meetings had focused more on "alpha male" anti-Obama chest-pounding than the strategy
sessions for which they'd been known.

Former ThinkProgress.org blogger Lee Fang also got a peek at the Palm Springs event, which was dubbed "Defending Free Enterprise." Fang, who first reported on the Koch seminars before the 2010 midterms, caught wind that someone had booked all 560 rooms at the Rennaisance Esmeralda Resort & Spa for three nights in late January and decided to investigate. "I arrived at the hotel the night before the event," Fang wrote, "but was followed closely by security and asked to leave the next morning before the Koch meeting guests arrived." During the seminar, "helicopters, private security, and police officers from neighboring cities patrolled the area constantly."


 

A Greenpeace blimp protests a 2011 Koch seminar in California. Gus Ruelas/Greenpeace

Fang wasn't able to get inside, but he did manage to identify several additional guests by scoping out their private jets at the Palm Springs International Airport. They included billionaire investor Phil Anschutz and Kenny Troutt, a Dallas investor who's given $700,000 to conservative super-PACs. Fang also noticed jets belonging to Harold Hamm, an Oklahoma oil tycoon, and Foster Friess, a Wyoming investor who's helped keep Rick Santorum afloat by pumping $381,000 into two super-PACs supporting the candidate. At last year's Vail seminar, Charles Koch thanked both Friess and Hamm (and Griffin) for their million-dollar contributions.

At the airport, Fang also spotted Phil Kerpen, vice president of the Koch-affiliated tea party group Americans for Prosperity, which recently spent $5 million on anti-Obama attack ads. Kerpen admitted that he hopes the 2012 election will result in "aggressive cuts to government spending and to regulation to allow robust economic growth," but not before complaining to Fang that "I thought they had stopped all leaks" concerning the whereabouts of the Koch seminars.


On the contrary, the meetings have become increasingly visible since they began quietly in 2003. Last January, Greenpeace flew an anti-Koch blimp (above) over the brothers' Palm Springs seminar. This That year, hundreds of anti-Koch protesters showed up outside the hotel amd were met by 60 police officers in riot gear who made 25 arrests.

10 Tough Truths From Harry Reid About The Kochs’ Lies, Propaganda and Radical Un-American Agenda

AlterNet / By Steven Rosenfeld

10 Tough Truths From Harry Reid About The Kochs’ Lies, Propaganda and Radical Un-American Agenda

 

The Democratic Senate Majority Leader has had enough.

US Senate Majority Leader, Harry Reid, speaks to reporters on Capitol Hill, in Washington, DC, on March 5, 2014

March 12, 2014  |   

 

 

Senate Majority Leader Harry Reid, a former boxer, has taken off the gloves to fight back against the Republican Party’s richest patrons: the libertarian billionaire oil barons, David and Charles Koch. Speaking from the U.S. Senate floor and in press conferences, Reid has forcefully started to do what much of the Democratic Party hasn’t so far—hit back at multi-million dollar political campaigns filled with lies about Obamacare, propaganda that climate change is a myth, and efforts by lobbyists and elected Republicans to gut public health laws and other safety nets.

What follows are 10 excerpts from Reid’s speeches in the past two weeks that begin to rebut the Koch’s political falsehoods and expose their real agenda. 
      
1. Kochs’ Anti-Obamacare Ads Filled With Lies

“I’m confident that most of you, if not all of you have seen this little piece in the Detroit News [noting that a women featured in an anti-Obamacare TV ad will save $1,000 in out-of-pocket healthcare expenses in 2014], where the secretive Koch brothers are spending untold millions to rig the system to benefit the top one percent at the expense of the middle class. So this is further evidence of the shadowy campaign of distortion and deception. You know, I have no problem with the people appearing in these ads. Even though it’s interesting, it’s been proven that the—one of the ads they ran in Alaska was an actor and the same actor is appearing in the same ad basically around the country. People have a right to be actors and appear in ads if they are real people, but they don’t have the right to lie… that’s what they’ve been doing.” (Press Conference, 3/11/14)

2. Koch Ads Filled With False GOP Fantasies

“Despite all that good news, there are plenty of horror stories being told. All of them are untrue, but they are being told all over America. The leukemia patient whose insurance policy was canceled and would die without her medication—Mr. [Senate] President, that is an ad being paid for by two billionaire brothers that is absolutely false; or the woman whose insurance policy went up $700 a month—ads paid for around America by the multibillionaire Koch brothers, and the ad is false. We heard about the evils of ObamaCare, about the lives it is ruining in the Republican stump speeches and in ads paid for by oil magnets, the Koch brothers. But those tales turned out to be just that—tales, stories made up from whole cloth, lies, distorted by the Republicans to grab headlines or make political advertisements.” (Floor Remarks, 2/26/14)

3. What Is Their Self-Described “Radical Agenda?” 

“Remember, “radical agenda” is what they called themselves. They said their agenda was radical, and it is. Eliminating Social Security, going against the minimum wage increase and being against it, just – these two brothers don’t like government. What they would do if they had their way is get rid of the EPA [Environmental Protection Agency], and we know that; they tried to get formaldehyde not to be restricted. And we all know about formaldehyde or if we don’t, we should. It causes cancer. What they want is lower taxes for themselves, while the middle class is left on their own. And it means what is happening in our country, led by the Koch brothers: the rich are getting richer, the poor are getting poorer, and the poor middle class is being squeezed out of existence.” (Press Conference, 3/11/14)

4. Kochs Make Billions From Dirty Industries

“These are the same brothers whose Koch Industries ranks near the top of the list of America’s worst toxic air polluters. Those are the same brothers whose company, according to a Bloomberg investigation, paid bribes and kickbacks to win contracts in Africa, India, and the Middle East. These are the same brothers who, according to the same report, used foreign subsidiaries to sell millions of dollars of equipment to Iran, a state sponsor of terrorism. Let’s make sure we understand that. I may not have said it quite right. These are the same brothers who, according to the same report, used foreign subsidiaries to sell millions of dollars of equipment to Iran, a state sponsor of terrorism. We all know that. (Floor Remarks, 3/4/14)

5. Kochs Don’t Respect Democracy or Government


“The Koch brothers already believe they can play by a different set of rules. Think about how an America rigged by the Koch brothers would look. The Koch brothers do not care about creating a strong public education system in America. The Koch brothers do not care about maintaining the strong safety net of Medicare and Social Security. The Koch brothers do not care about the guarantee of affordable, quality health insurance for every American… Their extreme vision for America means abolishing Social Security and Medicare. Their extreme vision for America means eliminating minimum wage laws. Their extreme vision for America means putting insurance companies back in charge of your health care and denying coverage for preexisting conditions. That is the way it used to be.” (Floor Remarks, 3/4/14)


6. Kochs: Class Warriors With Un-American Tactics


“What is un-American is when shadowy billionaires pour unlimited money into our democracy to rig the system, to benefit themselves and the wealthiest 1 percent… Based on their actions and policies they promote, the Koch brothers seem to believe in an America where the system is rigged to benefit the very wealthy. Based on Senate Republicans’ ardent defense of the Koch brothers and the fact that they advocate for many of the same policies as the Koch brothers, it seems my Republican colleagues also believe in a system that benefits billionaires at the expense of the middle class.” (Floor Remarks, 3/4/14)


7. Koch’s Political Business Model: Money Laundering 


“In 2010 the Supreme Court opened the floodgates of corporate money into electoral politics. That was with the Citizens United decision. Since mega donors such as Charles and David Koch can launder their huge contributions using shadowy shell groups and so-called nonprofits, it is difficult to tell exactly how much they have invested so far.

“Investigative reporting done by some of the most respected news outlets in the country has revealed that the Koch brothers funnel money through a web of investor groups and advocacy organizations that are immune from disclosure rules, such as the Club for Growth, Heritage Action, the NRA, and the U.S. Chamber of Commerce. We may never know how much money the Koch brothers are spending to rig the system, to rig the system for themselves.” (Floor Remarks, 3/4/14)

“They hide behind all kinds of entities. It is not just their front organization, Americans For Prosperity. They give money to all kinds of organizations—lots of money. When you make billions of dollars a year, you can be, I guess, as immoral and dishonest as your money will allow. It is too bad they are trying to buy America, and it is time the American people spoke out against this terrible dishonesty and about these two brothers who are about as un-American as anyone I can imagine.” (Floor Remarks, 2/26/14)

8. Kochs Bought And Own The GOP

“Their investments have paid off already. In November 2010, the petroleum industry walked right through the door the Supreme Court had opened and spent hundreds of millions of dollars to elect a Republican majority to the House of Representatives. That Republican majority has effectively shut down any hope of passing legislation to limit the pollution that has caused climate change. That Republican majority is, in fact, working to gut the most important safeguards to keep cancer-causing toxins and pollution that cause sickness and death out of the air we breathe and the water we drink…

“The Koch brothers are already seeing a return on their 2010 investment in a Republican House of Representatives that does what they want done. But they certainly have not stopped there. The Koch-backed Americans for Prosperity alone spent $400 million in misleading attack ads last election cycle… Koch-backed groups have spent a vast sum trying to elect Republican Senate candidates this year, a sum that dwarfs even the National Republican Senatorial Committee’s own spending.” (Floor Remarks, 3/4/14)

9. Kochs Falsely Claim This Is Free Speech

“Senate Republicans call this freewheeling spending by anonymous donors nothing more than “free speech.” Senate Republicans say that whoever has the most money gets the most free speech. But that is not what America’s Founding Fathers said. They did not mean that by free speech. The Founders believed in a democracy where every American had a voice and a vote.

“This discussion, this fight, is not just about health care or even about a few hundred million dollars in disingenuous ads. This is about two very wealthy brothers who intend to buy their own Congress, a Congress beholden to the money and bound to enact their radical philosophy. Witness this: Senators beholden to wealthy special interests; Republican senators rush to the floor to defend the Kochs whenever I say something negative about the brothers or their radical agenda.

“Their extreme vision for America means stripping tens of millions of people of the benefits in the Affordable Care Act today. Their extreme vision for America means allowing the gap between the wages women and men earn for the same work to keep growing. Their extreme vision for America means giving giant corporations the unfettered right to dump toxins in our rivers and streams, on our mountains and our valleys, and to give them even more tax breaks while they destroy our environment.” (Floor Remarks, 3/4/14)

10. Reid: I Will Keep Exposing The Kochs

“I am not oblivious that my comments about the Koch brothers have caused some controversy. Anyone who has turned on FOX News knows that I have gotten under their skin. But I will continue to shine a light on their subversion of democracy.

“When I hear my Republican colleagues defending the Koch brothers as they have, I recall the words of [Former Sen.] Adlai Stevenson: “I have been thinking that I would make a proposition to my Republican friends ..... that if they will stop telling lies about the Democrats, we will stop telling the truth about them.” As long as the Koch brothers continue to spend hundreds of millions of dollars buying elections, I will continue to do all I can to expose their intentions.” (Floor Remarks, 3/4/14]

Steven Rosenfeld covers democracy issues for AlterNet and is the author of "Count My Vote: A Citizen's Guide to Voting" (AlterNet Books, 2008).

Revealed: The Full Membership List of Wall Street’s Secret Society

New York

Daily Intelligencer

Daily Intel Home

Revealed: The Full Membership List of Wall Street’s Secret Society

• By Kevin Roose

 

Back in January 2012, I crashed the annual induction ceremony of Kappa Beta Phi, a secret society for elite Wall Street financiers. You can read the story of what happened here.

In addition to writing down details of what I saw, I also procured the official Kappa Beta Phi membership roll, a list that includes prominent Kappas like former Mayor Michael Bloomberg, AIG CEO Bob Benmosche, the former heads of Lehman Brothers and Bear Stearns, and Jon Corzine, the former New Jersey politician.

Here, as of 2012, is everyone who belongs to one of the most controversial and secretive organizations on earth.

First, here's what the program for the evening looked like:

And here's the member list:

Wall Street Chapter

Duff P. Anderson (1994)

Silas R. Anthony, Jr. (1993)

Andrew Arno (2001)

Peter A. Atkins (1977)

Walter E. Auch, Jr. (2000)

Sara Ayres (2009)

George L. Ball (1975)

Vincent Banker (2003)

David C. Batten (1981)

Bernard Beal (2007)

Robert Benmosche (2002)

James A. Benson (1995)

Jonathan M. Berg (2006)

Alfred R. Berkeley (2000)

Rosemary T. Berkery (2006)

Michael A. Berman (2000)

E. Garrett Bewkes III (1993)

Jessica Bibliowicz (1999)

John Birkelund (1981)

Ronald E. Blaylock (1999)

Michael R. Bloomberg (1995)

Andrew Blum (1972)

Howard L. Blum, Jr. (1986)

Magnus Bocker (2009)

Mike Bodson (2009)

Geoffrey T. Boisi (1989)

Kay Ryan Booth (1999)

Livio Borghese (1977)

Whitney Bower (2009)

Curt Bradbury (2006)

James W. Braham (1999)

Alan Breed (2010)

Joseph Breen (1980)

Howard M. Brenner (1990)

Robert G. Britz (1998)

Michael C. Brooks (1991)

Marianne Brown (2009)

Candace Browning (2008)

Samuel Butler (1974)

Barbara M. Byrne (2011)

Andrew Cader (1992)

John D. Carifa (1992)

Michael A. Carpenter (1990)

William M. Carson (1998)

Jolyne Caruso-Fitzgerald (2006)

Douglas J. Casey (1998)

Arthur D. Cashin (2000)

John K. Castle (1983)

James E. Cayne (1990)

John S. Chalsty (1990)

Alger B. Chapman, Jr. (1972)

Mac C. Chapman, Jr. (1987)

Suzanne Charnas (2011)

Adam D. Chinn (2005)

Todd J. Christie (2003)

Howard L. Clark, Jr. (1981)

Abram Claude (1970’s)

Patricia M. Cloherty (2001)

Sarah E. Cogan (2009)

Peter A. Cohen (1986)

Timothy C. Collins (2007)

Christopher M. Condron (1999)

Anthony Conroy (2011)

Jill M. Considine (2000)

Richard F. Conway (2005)

Langdon P. Cook (1984)

Gerald Corrigan (1989)

Jon S. Corzine (1990)

Michael Cosgrove (2008)

Lawrence Creel (2009)

Noreen M. Culhane (2005)

John N. Daly (1971)

John M. Damgard (1998)

Elizabeth B. (Beth) Dater (2004)

James M. Davin (1983)

Rafe de la Gueronniere (1987)

Francois de Saint Phalle (1980)

Jerry M. de St. Paer (1996)

Richard M. DeMartini (1991)

Ralph D. DeNunzio (1965)

Robert M. Devlin (2005)

Joseph S. DiMartino (1989)

Eric S. Dobkin (1996)

Carl H. Doerge, Jr. (1979)

Donald Donahue (2009)

Robert N. Downey (1988)

Stephen M. DuBrul, Jr. (1975)

Richard B. DuBusc (1984)

John Duffy (1988)

John G. Duffy (2007)

James J. Dunne III (2003)

Dexter D. Earle (1976)

John E. Eckelberry (1966)

Christine Edwards (1997)

J. Anthony Ehinger (1996)

Roger D. Elsas (1993)

Mary Farrell (2003)

Michael A.J. Farrell (2006)

Fred Federspiel (2008)

Laurence Fink (2002)

John D. Finnegan (2005)

Lawton W. Fitt (1999)

Martin Flanagan (2008)

Gregory J. Fleming (2007)

Alphonse Fletcher, Jr. (1995)

Thomas M. Flexner (2000)

Bruce S. Foerster (1983)

William E. Ford (2006)

Archibald McGhee Foster, Jr. (1992)

A. Hampton Frady, Jr. (1973)

Richard S. Fuld, Jr. (1995)

Nathan S. Gantcher (1992)

Neal S. Garonzik (2000)

John J. Gavin (1991)

Peter Georgiopoulos (2010)

Elbridge T. Gerry, Jr. (1982)

Louis V. Gerstner (1987)

William S.R. Gilbreath III (1973)

Jane Gladstone-Wheeler (2010)

Pam Goldman (2010)

Gary Goldring (2000)

Joe Goldsmith (2010)

Arthur H. Goldstone (1982)

Lesley Goldwasser (2004)

Joseph Grano (2002)

Richard A. Grasso (1990)

Peter T. Grauer (2003)

Micah Green (2003)

Alan C. Greenberg (1980)

Robert F. Greenhill (1985)

Martin Gruss (2009)

Randolph Guggenheimer, Jr. (1980)

Edmund A. Hajim (1996)

George E. Hall (2003)

Joseph Hardiman (1988)

J. Ira Harris (2004)

Jon M. Harris (2004)

Joshua Harris (2011)

William Harrison (1987)

Gates H. Hawn (1980)

Edward D. Herlihy (2003)

James F. Higgins (1993)

J. Tomilson Hill (2009)

Landon B. Hilliard III (1996)

Franklin W. Hobbs IV (1992)

Frank J. Hoenemeyer (1982)

Clark Hooper (2003)

George R. Hornig (2006)

Gedale B. Horowitz (1980)

Ruth Horowitz (2004)

Brian P. Hull (2006)

Samuel C. Hunter (1984)

James Hurlock (1989)

Bradley H. Jack (1999)

James A. Jacobson (1988)

A. James Jacoby (2000)

Francis P. Jenkins, Jr. (1988)

David Jennings (2003)

Wm. Mitchell Jennings, Jr. (2006)

Richard H. Jenrette (1976)

Thomas Johnson (1987)

Michael J. Johnston (1984)

William R. Johnston (1994)

Graham E. Jones (1977)

James Jones (1991)

Paul Tudor Jones II (2002)

Thomas M. Joyce (2005)

William M. Kearns, Jr. (1975)

Charles (Kirk) Kellogg (2004)

Peter R. Kellogg (1979)

James C. Kellogg IV (1983)

T. Richard Kendrick IV (2005)

Jerome Kenney (1989)

Hans W. Kertess (1981)

Richard Ketchum (1995)

Candace King-Weir (2010)

Mark Kingdon (2008)

James M. Kingsbury (1969)

Catherine R. Kinney (1997)

Michael S. Klein (2005)

Frederick A. Kingenstein (1973)

William Lee Knowles (1988)

David H. Komansky (2002)

Arthur Kontos (1998)

Doug Kramer (2011)

Peter S. Kraus (2007)

Sallie Krawcheck (2002)

Ron Kruszewski (2001)

Michael LaBranche (2000)

Marc E. Lackritz (1994)

Maria Elena Lagomasino (2005)

Jeffrey B. Lane (1988)

Steve Langman (2010)

Kenneth G. Langone (1996)

John J. Lauto (2007)

John G. Layng (1999)

Alexandra Lebenthal (1998)

James B. Lee, Jr. (1999)

Stephen M. Lessing (2002)

Arthur Levitt, Jr. (1979)

William Lewis (2008)

Robert D. Lindsay, Jr. (2010)

Robert V. Lindsay (1979)

Robert E. Linton (1981)

Martin Lipton (1987)

Bruce Lisman (2001)

Hugh P. Lowenstein (1990)

Nigel S. MacEwan (1972)

John G. MacFarlane III (1998)

John J. Mack (1993)

James J. Maguire (1993)

Thomas (Tom) Maheras (2004)

Andrew Malik (2011)

Amy Margolis (2011)

Donald Marron (1985)

Robert J. McCann (2003)

Robert H. McCooey, Jr. (2006)

Raymond J. McGuire (2005)

Shawn McLoughlin (2009)

Terence S. Meehan (1996)

Doris P. Meister (2001)

Carl B. Menges (1996)

Mitch M. Merin (1995)

Barrant V. Merrill (1981)

Eduardo G. Mestre (1995)

Roberto Mignone (2010)

John Miller (2010)

Howard Milstein (2006)

Joseph V. Missett III (1973)

Robert E. Munchin (1983)

Joseph H. Moglia (2005)

Samuel L. Molinaro, Jr. (2002)

Christopher S. Moore (1988)

John Moore (2009)

Charles F. Morgan (1960)

John C. (Hans) Morris (2006)

Averell Mortimer (2009)

David J. Mullan (2004)

Donald R. Mullen, Jr (2001)

Peter J. Murphy (2006)

Robert Murphy (2003)

Thomas Murphy (2011)

Jeanne L. Murtaugh (2004)

John H. Myers (2006)

Sarah E. Nash (1998)

Kenneth R. Natori (1980)

George Needham (2003)

Crocker Nevin (1970)

Donald E. Nickelson (1981)

Fares Noujaim (2005)

Seth Novatt (2010)

Michael Novogratz (2008)

Edward I. O’Brien (1977)

Timothy O’Hara (2008)

E. Stanley O’Neal (2002)

Michael J. Odrich (2006)

Morris W. Offit (1997)

Vikram S. Pandit (1884)

Paul G. Parker (2011)

Leland B. Paton (1995)

Douglas Paul (2003)

Richard S. Pechter (1991)

Joseph R. Perella (1990)

Norman H. Pessin (1984)

John R. Petty (1988)

John J. Phelan, Jr. (1979)

Peter V.N. Philip (1967)

Thomas L. Piper III (1978)

Michael Pizzuto (1982)

Grant A. Porter (2007)

Christopher Quick (2002)

Leslie C. Quick III (2002)

Peter Quick (2001)

Michael L. Quinn (1996)

Paul E. Raether (1993)

Maribeth S. Rahe (2001)

Lewis S. Ranieri (1987)

Alan C. Rappaport (2006)

Peter S. Rawlings (1976)

Robert L. Reynolds (2007)

Joseph Rice III (2006)

Reuben F. Richards (1973)

Robert Ritterseiser (1985)

Rachel Robbins (1997)

Julian H. Robertson (1987)

James D. Robinson III (1982)

James D. Robinson IV (2011)

Linda Robinson (2003)

Joe L. Roby (1992)

John Roche (1984)

E. John Rosenwald, Jr. (1982)

Wilbur L. Ross, Jr. (2006)

Mitchell J. Rubin (2010)

Robert E. Rubin (1982)

Thomas A. Russo (2002)

Heather L. Ruth (1999)

Michael Ryan (2011)

Thomas F. Ryan, Jr. (1997)

T. Timothy Ryan (2009)

Gregory E. Sacco, Jr. (1983)

William R. Salomon (1971)

Jim Sampson (2010)

Charles S. Sanford (1980)

Ralph S. Saul (1969)

Thomas A. Saunders III (1979)

Anthony Scaramucci (2011)

Peter Scaturro (2009)

Ralph Schlosstein (2003)

Richard J. Schmeelk (1983)

Joseph Schmuckler (2009)

Edward C. Schmults (1979)

Peter Schulte (2010)

Alan D. Schwartz (1989)

Robert G. Scott (1993)

Kevin R. Seth (2011)

Robert S. Shafir (2005)

Gene Shanks (1989)

Mary L. Schapiro (1997)

Robert F. Shapiro (1969)

Theodore P. Shen (1983)

Martin Siegel (1986)

Brandon Sim (2011)

Craig S. Sim (1984)

Hardwick Simmons (1989)

John C. (Hans) Sites, Jr. (1995)

Philip M. Skidmore (1980)

Alfred Smith IV (1998)

Michelle Smith (2008)

Richard A. Smith (1982)

Winthrop H. Smith, Jr. (2000)

Salvatore (Sal) Sodano (2004)

Warren J. Spector (1997)

Esta Stecher (2006)

George C. Stephenson (1991)

James Stern (1999)

James M. Stewart (1982)

Donald Stone (1975)

Thomas W. Strauss (1986)

Mark B. Sutton (2001)

Richard F. Syron (1995)

Anne Tatlock (2002)

Diana L. Taylor (2004)

Michael Tennenbaum (2010)

Pamela Thomas-Graham (2002)

Todd S. Thomson (2005)

Richard E. Thornburgh (2002)

Allen Thrope (2011)

Carl H. Tiedemann (1975)

David J. Topper (2006)

Robert A. Towbin (1975)

Jamie Townsend (2003)

Remy Trafelet (2008)

Michael K. Travers (1975)

Bruce N. Tullo (1983)

Thomas I. Unterberg (1983)

John O. Utendahl (2004)

John J. Veronis (1989)

John L. Vogelstein (2006)

Robert G. Wade, Jr. (1980)

George Walker (2008)

Andy Walter (2010)

Dennis Weatherstone (1980)

Lisa M. Weber (2005)

David Weild IV (2003)

Sanford I. Weill (1980)

Keith S. Wellin (1970)

Curtis R. Welling (1999)

Kim White (2004)

John C. Whitehead (1971)

Meredith Whitney (2010)

Frederick B. Whittemore (1968)

George Wiegers (1968)

Christopher J. Williams (2006)

Dave H. Williams (1987)

Kendrick Wilson III (1995)

Sam H. Wolcott III (1977)

James D. Wolfensohn (1979)

Kurt Wolfgruber (2006)

Frederick Wonham (1970)

Ward W. Woods, Jr. (1984)

A. Jones Yorke IV (1975)

Montgomery Street Chapter

Charles Haynor – Grand Swipe

Robert S. Basso

Richard M. Beleson

D. Kent Clayburn

James F. Dowley

John C. Helmer

Douglas C. Heske

William D. Hobi

John P. Hullar

John T. Hyland

Andrew J. Jennings

David Kavrell

George A. Miller

Francis X. Roche

John P. Roediger

John L. Sullivan

Joseph E. Sweeney

Spring Street Chapter

Warren Wibbelsman – Grand Swipe

James Ford

Michael O. Healy

Kenneth Tang

1% Jokes and Plutocrats in Drag: What I Saw When I Crashed a Wall Street Secret Society

New York

Daily Intelligencer


Daily Intel Home

1% Jokes and Plutocrats in Drag: What I Saw When I Crashed a Wall Street Secret Society

By Kevin Roose 

Recently, our nation’s financial chieftains have been feeling a little unloved. Venture capitalists are comparing the persecution of the rich to the plight of Jews at Kristallnacht, Wall Street titans are saying that they’re sick of being beaten up, and this week, a billionaire investor, Wilbur Ross, proclaimed that “the 1 percent is being picked on for political reasons.”

Ross's statement seemed particularly odd, because two years ago, I met Ross at an event that might single-handedly explain why the rest of the country still hates financial tycoons – the annual black-tie induction ceremony of a secret Wall Street fraternity called Kappa Beta Phi.

Adapted

from Kevin Roose’s book Young Money, published today by Grand Central Publishing.

 

“Good evening, Exalted High Council, former Grand Swipes, Grand Swipes-in-waiting, fellow Wall Street Kappas, Kappas from the Spring Street and Montgomery Street chapters, and worthless neophytes!”

It was January 2012, and Ross, wearing a tuxedo and purple velvet moccasins embroidered with the fraternity’s Greek letters, was standing at the dais of the St. Regis Hotel ballroom, welcoming a crowd of two hundred wealthy and famous Wall Street figures to the Kappa Beta Phi dinner. Ross, the leader (or “Grand Swipe”) of the fraternity, was preparing to invite 21 new members — “neophytes,” as the group called them — to join its exclusive ranks.

Looking up at him from an elegant dinner of rack of lamb and foie gras were many of the most famous investors in the world, including executives from nearly every too-big-to-fail bank, private equity megafirm, and major hedge fund. AIG CEO Bob Benmosche was there, as were Wall Street superlawyer Marty Lipton and Alan “Ace” Greenberg, the former chairman of Bear Stearns. And those were just the returning members. Among the neophytes were hedge fund billionaire and major Obama donor Marc Lasry and Joe Reece, a high-ranking dealmaker at Credit Suisse. [To see the full Kappa Beta Phi member list, click here.] All told, enough wealth and power was concentrated in the St. Regis that night that if you had dropped a bomb on the roof, global finance as we know it might have ceased to exist.

During his introductory remarks, Ross spoke for several minutes about the legend of Kappa Beta Phi – how it had been started in 1929 by “four C+ William and Mary students”; how its crest, depicting a “macho right hand in a proper Savile Row suit and a Turnbull and Asser shirtsleeve,” was superior to that of its namesake Phi Beta Kappa (Ross called Phi Beta Kappa’s ruffled-sleeve logo a “tacit confession of homosexuality”); and how the fraternity’s motto, “Dum vivamus edimus et biberimus,” was Latin for “While we live, we eat and drink.”

On cue, the financiers shouted out in a thundering bellow: “DUM VIVAMUS EDIMUS ET BIBERIMUS.”

The only person not saying the chant along with Ross was me — a journalist who had sneaked into the event, and who was hiding out at a table in the back corner in a rented tuxedo.

 

Several Kappas at the table next to me, presumably discussing the coming plutocracy.

 

 

I’d heard whisperings about the existence of Kappa Beta Phi, whose members included both incredibly successful financiers (New York City's Mayor Michael Bloomberg, former Goldman Sachs chairman John Whitehead, hedge-fund billionaire Paul Tudor Jones) and incredibly unsuccessful ones (Lehman Brothers CEO Dick Fuld, Bear Stearns CEO Jimmy Cayne, former New Jersey governor and MF Global flameout Jon Corzine). It was a secret fraternity, founded at the beginning of the Great Depression, that functioned as a sort of one-percenter’s Friars Club. Each year, the group’s dinner features comedy skits, musical acts in drag, and off-color jokes, and its group’s privacy mantra is “What happens at the St. Regis stays at the St. Regis.” For eight decades, it worked. No outsider in living memory had witnessed the entire proceedings firsthand.

 

A Kappa neophyte (left) chats up a vet.

 

I wanted to break the streak for several reasons. As part of my research for my book, Young Money, I’d been investigating the lives of young Wall Street bankers – the 22-year-olds toiling at the bottom of the financial sector’s food chain. I knew what made those people tick. But in my career as a financial journalist, one question that proved stubbornly elusive was what happened to Wall Streeters as they climbed the ladder to adulthood. Whenever I’d interviewed CEOs and chairmen at big Wall Street firms, they were always too guarded, too on-message and wrapped in media-relations armor to reveal anything interesting about the psychology of the ultra-wealthy. But if I could somehow see these barons in their natural environment, with their defenses down, I might be able to understand the world my young subjects were stepping into.

So when I learned when and where Kappa Beta Phi’s annual dinner was being held, I knew I needed to try to go.

Getting in was shockingly easy — a brisk walk past the sign-in desk, and I was inside cocktail hour. Immediately, I saw faces I recognized from the papers. I picked up an event program and saw that there were other boldface names on the Kappa Beta Phi membership roll — among them, then-Citigroup CEO Vikram Pandit, BlackRock CEO Larry Fink, Home Depot billionaire Ken Langone, Morgan Stanley bigwig Greg Fleming, and JPMorgan Chase vice chairman Jimmy Lee. Any way you count, this was one of the most powerful groups of business executives in the world. (Since I was a good 20 years younger than any other attendee, I suspect that anyone taking note of my presence assumed I was a waiter.)

I hadn’t counted on getting in to the Kappa Beta Phi dinner, and now that I had gotten past security, I wasn’t sure quite what to do. I wanted to avoid rousing suspicion, and I knew that talking to people would get me outed in short order. So I did the next best thing — slouched against a far wall of the room, and pretended to tap out emails on my phone.

 

 The 2012 Kappa Beta Phi neophyte class.

 

 

After cocktail hour, the new inductees – all of whom were required to dress in leotards and gold-sequined skirts, with costume wigs – began their variety-show acts. Among the night’s lowlights:

• Paul Queally, a private-equity executive with Welsh, Carson, Anderson, & Stowe, told off-color jokes to Ted Virtue, another private-equity bigwig with MidOcean Partners. The jokes ranged from unfunny and sexist (Q: “What’s the biggest difference between Hillary Clinton and a catfish?” A: “One has whiskers and stinks, and the other is a fish”) to unfunny and homophobic (Q: “What’s the biggest difference between Barney Frank and a Fenway Frank?” A: “Barney Frank comes in different-size buns”).

• Bill Mulrow, a top executive at the Blackstone Group (who was later appointed chairman of the New York State Housing Finance Agency), and Emil Henry, a hedge fund manager with Tiger Infrastructure Partners and former assistant secretary of the Treasury, performed a bizarre two-man comedy skit. Mulrow was dressed in raggedy, tie-dye clothes to play the part of a liberal radical, and Henry was playing the part of a wealthy baron. They exchanged lines as if staging a debate between the 99 percent and the 1 percent. (“Bill, look at you! You’re pathetic, you liberal! You need a bath!” Henry shouted. “My God, you callow, insensitive Republican! Don’t you know what we need to do? We need to create jobs,” Mulrow shot back.)

• David Moore, Marc Lasry, and Keith Meister — respectively, a holding company CEO, a billionaire hedge-fund manager, and an activist investor — sang a few seconds of a finance-themed parody of “YMCA” before getting the hook.

• Warren Stephens, an investment banking CEO, took the stage in a Confederate flag hat and sang a song about the financial crisis, set to the tune of “Dixie.” (“In Wall Street land we’ll take our stand, said Morgan and Goldman. But first we better get some loans, so quick, get to the Fed, man.”)

A few more acts followed, during which the veteran Kappas continued to gorge themselves on racks of lamb, throw petits fours at the stage, and laugh uproariously. Michael Novogratz, a former Army helicopter pilot with a shaved head and a stocky build whose firm, Fortress Investment Group, had made him a billionaire, was sitting next to me, drinking liberally and annotating each performance with jokes and insults.

“Can you fuckin’ believe Lasry up there?” Novogratz asked me. I nodded. He added, “He just gave me a ride in his jet a month ago.”

The neophytes – who had changed from their drag outfits into Mormon missionary costumes — broke into their musical finale: a parody version of “I Believe,” the hit ballad from The Book of Mormon, with customized lyrics like “I believe that God has a plan for all of us. I believe my plan involves a seven-figure bonus.” Amused, I pulled out my phone, and began recording the proceedings on video. Wrong move.

 

The grand finale, a parody of "I Believe" from The Book of Mormon

 

“Who the hell are you?” Novogratz demanded.

I felt my pulse spike. I was tempted to make a run for it, but – due to the ethics code of the New York Times, my then-employer – I had no choice but to out myself.

“I’m a reporter,” I said.

Novogratz stood up from the table.

"You’re not allowed to be here," he said.

I, too, stood, and tried to excuse myself, but he grabbed my arm and wouldn’t let go.

“Give me that or I’ll fucking break it!” Novogratz yelled, grabbing for my phone, which was filled with damning evidence. His eyes were bloodshot, and his neck veins were bulging. The song onstage was now over, and a number of prominent Kappas had rushed over to our table. Before the situation could escalate dangerously, a bond investor and former Grand Swipe named Alexandra Lebenthal stepped in between us. Wilbur Ross quickly followed, and the two of them led me out into the lobby, past a throng of Wall Street tycoons, some of whom seemed to be hyperventilating.

Once we made it to the lobby, Ross and Lebenthal reassured me that what I’d just seen wasn’t really a group of wealthy and powerful financiers making homophobic jokes, making light of the financial crisis, and bragging about their business conquests at Main Street’s expense. No, it was just a group of friends who came together to roast each other in a benign and self-deprecating manner. Nothing to see here.

But the extent of their worry wasn’t made clear until Ross offered himself up as a source for future stories in exchange for my cooperation.

“I’ll pick up the phone anytime, get you any help you need,” he said.

“Yeah, the people in this group could be very helpful,” Lebenthal chimed in. “If you could just keep their privacy in mind.”

I wasn’t going to be bribed off my story, but I understood their panic.  Here, after all, was a group that included many of the executives whose firms had collectively wrecked the global economy in 2008 and 2009. And they were laughing off the entire disaster in private, as if it were a long-forgotten lark. (Or worse, sing about it — one of the last skits of the night was a self-congratulatory parody of ABBA’s “Dancing Queen,” called “Bailout King.”) These were activities that amounted to a gigantic middle finger to Main Street and that, if made public, could end careers and damage very public reputations.

After several more minutes spent trying to do damage control, Ross and Lebenthal escorted me out of the St. Regis.

As I walked through the streets of midtown in my ill-fitting tuxedo, I thought about the implications of what I’d just seen.

The first and most obvious conclusion was that the upper ranks of finance are composed of people who have completely divorced themselves from reality. No self-aware and socially conscious Wall Street executive would have agreed to be part of a group whose tacit mission is to make light of the financial sector’s foibles. Not when those foibles had resulted in real harm to millions of people in the form of foreclosures, wrecked 401(k)s, and a devastating unemployment crisis.

The second thing I realized was that Kappa Beta Phi was, in large part, a fear-based organization. Here were executives who had strong ideas about politics, society, and the work of their colleagues, but who would never have the courage to voice those opinions in a public setting. Their cowardice had reduced them to sniping at their perceived enemies in the form of satirical songs and sketches, among only those people who had been handpicked to share their view of the world. And the idea of a reporter making those views public had caused them to throw a mass temper tantrum.

The last thought I had, and the saddest, was that many of these self-righteous Kappa Beta Phi members had surely been first-year bankers once. And in the 20, 30, or 40 years since, something fundamental about them had changed. Their pursuit of money and power had removed them from the larger world to the sad extent that, now, in the primes of their careers, the only people with whom they could be truly themselves were a handful of other prominent financiers.

Perhaps, I realized, this social isolation is why despite extraordinary evidence to the contrary, one-percenters like Ross keep saying how badly persecuted they are. When you’re a member of the fraternity of money, it can be hard to see past the foie gras to the real world.

Copyright 2014 by Kevin Roose. Reprinted by permission of Grand Central Publishing. All rights reserved.

Can Right-Wingers and Plutocrats Be Stopped from Destroying Social Security?

  Economy  

AlterNet / By Steven Rosenfeld

Can Right-Wingers and Plutocrats Be Stopped from Destroying Social Security?

 

There's momentum in the fight to strengthen, instead of gut, social security.

Photo Credit: Image by Shutterstock

 

 

 

February 12, 2014  |  

 

 

A new effort to build bipartisan consensus on fortifying Social Security was unveiled in Washington on Friday that shows the promise and perils of the evolving debate on the how tens of millions of aging Americans will support themselves in coming years.

On the promising side, an extensive public engagement process by a new centrist group, the Program for Public Consultation (PCP), found vast bipartisan agreement to strengthen Social Security now through progressive tax increases and even increasing some benefits. On the perilous side, the starting line for its discussion is the tedious rightwing drumbeat about revenue shortfalls two decades from now, which distract from focusing on today’s retirement security crisis and what steps can address more immediate human needs.

“They did not brief respondents on the retirement crisis or ask them if they had saved enough for retirement,” said an analyst with one of the more progressive reform groups, who attended the PCP briefing but commented on background. “So respondents were tasked with the narrow job of eliminating the shortfall, rather than devising the best Social Security policy.”

After several decades where the political debate on Social Security has been dominated by right-wingers who want to either eliminate, privatize or cut it, there’s new momentum in Washington to step back and starting discussing how Social Security can be fixed for today’s recipients and Americans who will soon retire. Like all political debates, how the problem is defined has a lot to do with what solutions are offered.

What’s needed now, the analyst said, was “a discussion of people and their retirement insecurity—especially Generation Xers and millenials. Those advocating cutting Social Security say it is to protect our children and grandchildren, yet they will need it even more than today’s retirees do.”
The Program for Public Consultation is a relatively new group whose board is made up of a dozen former Democratic and Republican congressmen, and another two-dozen experts who wear many hats as policy centrists in Washington. Their foundation-funded initiative is noteworthy not only because it will be repeated in congressional districts in 2014, but because its early findings support taking specific steps now that progressives have been touting for years—and for which there is huge public support to do so.

For example, after holding workshops last July where 738 people took part, PCP polled participants and found that 76 percent backed the most progressive revenue solution: eliminating the little-known cap on taxable income that funds Social Security. People only pay taxes on the first $117,000 of their income, not investments, for the social insurance program. That step alone would eliminate the projected shortfall two decades from now and generate a surplus funds to expand current benefits by one-sixth, PCP Director Seven Kull said at the press briefing.

PCP also found strong support, 72 percent, to increase the minimum monthly benefit for retirees—which, at $760, is below the federal poverty line. And it found that 73 percent also favored increasing benefits once people reach age 80. The majority, 59 percent, also supported reducing Social Security payments to wealthy Americans who didn’t need it. Those poll results reflect sizeable majorities to act now to expand the program.     

But on the perilous side, the starting line for PCP’s exercise reflects the conservative bias that elevates concern about projected finances in 2033 above whether today’s benefits are enough, let alone in two decades. PCP mostly frames the challenge as ensuring retirees do not see a 23 percent cut in benefits in 19 years due to inadequate income tax revenue. Anti-tax Republicans and Wall Street financiers have cited those projections to call for cuts now, or political compromises that will not ensure that tens of millions of people age with dignity and stay out of poverty—why it was created in the 1930s.

Seizing The Political Third Rail

Nonetheless, this new Washington-based initiative signals a changing political landscape and willingness to tackle an issue that was long thought to be political suicide—tinkering with America’s most popular government-run social insurance program.

“When we talk about Social Security, many of us will immediately think about the third rail idea—that you can’t really touch this because it’s too hot,” said Marvin Kalb, the ex-CBS and NBC reporter, in opening remarks as he moderated a panel presenting PCP’s findings. “Well this study that’s before us today is called, ‘Is It Really a Third Rail’ and ‘How the American People Would Reform Social Security.”   

“The overall ground is to show public respondents and people who want to take the exercise how is the problem painted by the people who are responsible for painting it—for showing the elected members of Congress how the problem looks,” Kull said, going through the project’s policy-shaping process. “It goes back to trying to simulate the experience that members of Congress have.”
PCP’s project, dubbed “Voice of The People,” comes amid growing awareness that much of the 76-million-member Baby Boom generation—in all demographics—has not saved enough for their retirement, making Social Security and Medicare their primary means of support. That’s because employer-provided pensions have been vanishing for decades, and the private investment plans that replaced them, such as 401Ks, are insufficient. Only 20 percent of seniors, earning more than $58,000 a year, will not rely on Social Security as their main income, the National Academy of Social Insurance has found.

Last July, PCP enlisted 738 people from around the country in a process that they call the “citizen cabinet model.” They first briefed the participants as Congress’s staffers would brief elected officials—using staff Republican and Democratic analyses from House and Senate committees that deal with Social Security. They also used papers from advocacy groups: the conservative American Enterprise Institute and liberal National Academy Of Social Insurance. Then they convened groups to go through the policy options, starting with separating facts from partisan opinions. They noted the pros and cons of choices, and finally polled participants on solutions.

The briefings started by explaining Social Security’s basics, which are not complicated. The social insurance program is funded by payroll taxes on the first $117,000 of taxable income. Benefits are calculated by averaging lifetime earnings, although lower-income people receive a larger percentage than wealthier people. Today, average retirees receive $1,290 a month. The foremost problem presented was that after 2033 the revenue paying for this level of support, after future cost-of-living increases, will run out and benefits will have to be cut by 23 percent unless “reforms” are undertaken.

The solutions presented were not just what’s been noted on progressive websites—which favor increasing Social Security taxes to cover the far-off shortfall and to expand benefits now. Participants were asked whether benefits should be cut for high income people who don’t really need them. They were asked if the retirement age should go up; it’s now 66 and becomes 67 in 2027. They were asked if payroll taxes should be increased slightly, and if the cap on taxable earnings should raised or be scrapped.

They also were asked if minimum benefits should be higher, and whether benefits should go up again at age 80. Finally, they were asked what cost-of-living formula should be used for calculating annual increases; one cutting future benefit levels compared to what is used today (the so-called chained CPI, which has been endorsed by President Obama) or another one that’s more targeted to elderly buying trends, called the CPI-E.

Surprising Results

To start, 72 percent of participants—66 percent Republicans, 82 percent Democrats—had “positive” views of Social Security. Slightly more than half said that the average monthly benefit was “about the same as you expected.” More Republicans, 57 percent, said that they knew about “the [revenue] shortfall,” compared to 50 percent of Democrats.

The way these discussions unfolded—from prior knowledge, to briefings, to discussing reform pros and cons, to voting on options—was noteworthy. The longer people talked, the more certain approaches emerged with growing bipartisan support, Kull said, until popular ideas crossed a threshold. For example, two-thirds found it “at least tolerable to reduce benefits for the top 25 percent of earners. Just under half found tolerable reducing benefits for the top 40 percent,” PPC reported. “Reducing benefits to the top 50 percent was found tolerable by only one-in-three, with little difference among the parties.”
In other words, means-testing for Social Security benefits, is seen as a fair policy—as long as people who will really need the monthly stipend don’t see unnecessary cuts.

On raising the retirement age, “six in ten found [it] at least tolerable raising the age to 68, with no difference between the parties.” But 69 was too high for most Democrats and for half the Republicans. And raising the onset of benefits to 70 was opposed by 75 percent.

Perhaps the most intriguing results concerned raising or eliminating the cap on taxable earnings. When provided with narrow partisan arguments, pro and con, for raising the cap from $117,000 to $215,000 over 10 years, 66 percent agreed with the case for raising it, while 59 percent agreed with the case against it. Kull said this result wasn’t entirely a contradiction, but more a measure of the strength of different positions.

When the case was offered for eliminating the cap—“the incomes of the wealthy have been growing by leaps and bounds, while the incomes of the middle class have been stagnating”—76 percent agreed. Meanwhile, the argument against eliminating the cap— “high earners just saw their income taxes, investment taxes and Medicare taxes increased”—was the least convincing of all, garnering only 47 percent support. Thus, the more time that people took to understand the issue, the more support there was for the most progressive solutions—raising taxes on those most able to pay in order to fortify present and future benefits.
PCP’s spokespeople said that their policy-making exercise, which they plan to take to congressional districts in coming months, showed there was a middle path possible to modernize the nation’s biggest social insurance program.
“One of the central issues that I get from reading this study is that for those people who feel that there is no way around this third rail, there is,” Kalb said. “If you address it from the point of view of what the American people think about a possible solution, what you come up with is that by sizeable majorities, both Democrats and Republicans, the American people do feel that a sensible compromise is the way to go. And that sensible compromise involves, on the one hand, obviously, raising taxes, and on the other, limiting benefits that are available. But balancing the two, in an intelligent way, can be done in the opinion of overwhelming majorities of the American people.” 

“I think this is a wonderful moment to tackle Social Security because we’re not going to have budget action for the next year or two,” said Alice Rivlin, ex-Clinton White House budget director. “One of the cogent arguments that the advocates for the elderly make was, ‘We do need to solve the Social Security problem, but not in the budget context: don’t balance the budget on the backs of the elderly and do it as something separate.’ Well now is our chance to do something separate.”

Living Wages And Minimum Benefits

Even though these conclusions point to solutions championed by progressives for a long time, it’s important to note that PCP’s public engagement process is by no means the whole discussion. At PCP's press conference, Ben Veghte, research director for Social Security Works, said the discussion about “shortfalls” was not just about money, but also about Social Security’s public purpose. When he asked if that was part of PCP’s briefings, Kull replied that their process mostly relied on congressional reports for issue analyses, and that point seemed like an argument—a secondary concern—but he’d note the suggestion.

What seniors who outlive their savings will live on in coming years—which is forecast for tens of millions of baby boomers—is what gets lost when the focus is mainly on preventing a projected 23 percent cut in benefits in 19 years. However, PCP’s report offered some stiking statistics that highlight how different policies can mean big shorter-term differences between falling into poverty or not.

For example, today’s minimum benefit, about $770 a month, is currently below the federal poverty line. To raise that to 125 percent of the poverty line, or about $1,150 a month, “would increase the [projected 2033] Social Security shortfall by 7 percent,” they reported. But at the press conference, Kull said that eliminating the income tax cap would bring the Social Security Trust Fund in 2033 to 117 percent of projected payouts. In other words, that’s one simple way to strengthen and expand current and future benefits.

The framing of this discussion, especially at this early stage, is crucial. Another missing piece today would compare Social Security benefits to the the minimum wage—since the idea of Social Security is a social insurance program that provides a basic pension for people with little other income.

Today’s average monthly retiree benefit of $1290 would break down to $8.06 an hour if it were calculated based on 40 hour weeks. That’s poverty-level income. Even President Obama in the State Of The Union speech called for raising the federal minimum wage to $10.10 an hour, which equates to $1616 a month. In California, where living costs are higher, Republican Ron Unz is bankrolling a fall 2014 state ballot measure to lift the state’s minimum wage to $12 an hour—which translates to $1920 a month.

It’s eye-opening to contrast what’s being discussed today as a minimum living wage to what’s under discussion for Social Security payouts. As groups like Program for Public Consultation take their policy-creating process on the road, they are likely to hear that America’s retirement security crisis is at hand now, and involves much more than just balancing the projected books in 2033.

These are the individuals who have contributed to AlterNet's Retirement Crisis Reporting Fund:

Nancy Adams | Maria Alvarez | Dolores Amato | Sara Baker | Jerry Banks | Catherine Barnes | Patti Batchelder | Maryann Bayne | William Bell | Hugo Benoit | Werner Bergman | Lisa Beutler | Patricia Bewley | Gary Billey | Gary Binderimz | Rosemarie Blake | Bhikkhu Bodhi | Robert Bottman | Christopher Boutelle | Angus Bowen | B. Bowers | Charles Brainard | Kern Braswell | Catherine Brave | Jody Breslaw | Kim Brown | Marilyn Bruning | Bonnie Burkart | John Burke | Jeffrey Cancilla | Alice Canty | Dorothy Cinquemani | Kenneth Clark | Suzan Clausen | Robert Cohen | Harriet Cohen | Sandra Colombo | Michael Conley | Casey Conner | | Eugene Constant | Rachel Cooke | Peter Costello | Sydney Crawford | Iris Culter | Kathleen Daugherty | Gary Davis | Michael Davis | Richard Dawson | Jorge De Cecco | Kenneth Deed | Nandi Devam | Kim Dexter | J.A. Dingman | Elizabeth DiPalma | Patricia Dodds | John Doheny, Jr. | Gloria Donohue | Don Dougherty | Albert Driscoll | Stu Duckman | Ronald Dumont | Kim Ecclesine | Nancy Eckel | Cynthia Ellsmore | Edwin Engelmann | Judith Espovich | Virginia Eyman | Matthew Farrell | Karen Fedorov | Perrin Ferris | Thomas Firpo | Carolyn Fletcher | Christopher Flores | Terry Fontenot | Barbara Ford | Thomas Friel | Linda Fulton | Larry Gaylord | Marion Gehlker | David Glater | Nancy Goldberg | Donald Goldmacher | Alison Gomez | Florence Granowitter | Emily Greene | David Griscom | Terrence Grywinski | Shawn Hansen | Debra Harpole | Louise Harris | George Hart | Stuart Hartley | Bill Healey | Geoffrey Hendricks | Robert Henning | Marion Hirseman | Martin Hittelman | Cathy Hoot | James Hopkins | David Huhn | Will Husa| Ayed Hyder | Linda Irenegreen | Aaron Jacobs | Bobie Johnson | Wynn Kapit | Elizabeth Kelley | Jae Kenworthy | Ronald Kestler | Anita Kichefski | Jeremy Kilborn | W. Kimzey | Kerry Kleiber | Denise Kobylarz | Sandra Korn | Nancy Kranich | John Kyper | Bruce Lee | Marilyn Lee | Theodore Leibowitz | Carol Lemieux | Henry Lesnick | Betty Leyerle | Ellen Linnemanstons | Robert Lipsyte | Joan and Wallace MacDonald | Susan MacMillan | Charlene Maker | Barry Maloney | Josepha Maly | Tommy Mandel | Lawrence Mar | Louis Mariani | Joseph Mastalski | Annie Masters | Chris Matthews| George Matkovits| Kay Matthews| Frank McEvoy| Gail McMullen| Kevin Meismer| Elizabeth Mewhinney| Mary Micek| Rosemary Migas | Claire Mills |  Jonathan Morris | Nina Murano | Christine Murphy | John Murrill | Deborah Mytels | Jean Naples|  Peter Nasatir| Aileen Nelson| Terrance Newton| Deborah Nitasaka| D. Ocker| Janet Ohlhausen| Clifford Olin| Judith Pearson| Charles Percival | Jeanne-Marie Peterson | Mary Peterson | Cynthia Peterson | Ted Pfeiff | Brian Porter | Rudolph Radau | Joseph Rainho | Richard Rayford | Lisa Reswick | Debbie Richards | Sharon Richey | Leonard Rifas | Marvin Ritzenhaler | Nancy Roca | Edwin Rogers | Sue Rosen | Richard Ross | Nancy Ryan | Susan Salazar | Joseph Sanchez | Terry Sanders | Elizabeth Sands | Carole Sauriol | Carol Scher | Scott Scherman | Wanda Schertz | Gerda Seaman | Carolyn Semiglasow | Marlene Shaner | Elaine Simon | Crystal Sloa | Sara Sogut| Helen Sohne| Priscilla Solomon| Wayne Stinson| Patricia Stroud| Francis Sullivan, Jr.| Jyun Takagi| Tasmin Taylor| Diane Thatcher | C. Thompson | Keith Thornton | Lisa Tomchesson | Priscilla Toth | Catherine Twohill | Eric Weis | Teresa Welborn | Wilma A. Wheeler | Joel White | Dolores Whitman | Terry and Barbara Williams | Hugh Wilson | Liddy Wilson | Carroll M. Wilson | Eric Wilson | Jack Wilson | Charles Witt | William Woodward | James Woolsey | Eleanor Wynn | Christine Wynne | David Yamada | Leroy York, II | James Young | Marian Zaouk | Susan Zencka

Steven Rosenfeld covers democracy issues for AlterNet and is the author of "Count My Vote: A Citizen's Guide to Voting" (AlterNet Books, 2008).