Citizens’ Deficit Commission Report Warns Austerity Will Block Recovery

Report Says Direction Chosen By The White House Commission Is The Wrong One For The Economy; Report Calls for More Job Creation and Long-Term Investment

The White House deficit commission proposals released today are “fundamentally misguided” and will take the economic debate in the dangerous direction of austerity, say a group of well-known experts and leaders of civic organizations that released its own plan, “Report and Recommendations of the Citizens’ Commission on Jobs, Deficits and America’s Economic Future.”

You can see the report here: OurFuture.org/citizenscommission [1]

The report was released on a media call Tuesday featuring Robert L. Borosage, co-director of the Campaign for America’s Future; Deepak Bhargava, executive director the Center for Community Change; Angela Glover Blackwell, founder and president of PolicyLink; Larry Cohen, president of the Communications Workers of America and Robert Kuttner, co-founder of The American Prospect and a senior fellow at Demos.

[You can listen to the audio of the press call here [2].]

The citizens commission is led by a 23-member group that includes economists, labor and grassroots organization leaders, and academic experts. Among them is Deepak Bargava, director of the Center for Community Change, who on the call denounced the co-chairs of the White House deficit commission, Alan Simpson and Erskine Bowles, for pushing cuts to Social Security.

Noting that the average Social Security benefit is about $14,000 a year, Bhargava said, "It is morally unacceptable to reduce benefits to middle-income and low-income people, or to raise the retirement age, as Bowles-Simpson would do."

Likewise, Angela Glover Blackwell, the director of the PolicyLink think tank, said that poor- and middle-class families, particularly people of color, have already been harmed too severely by the recession and the decade of economic stagnation that preceded it. "We can't slash our way to prosperity. We must grow the nation out of this crisis," she said.

"Working Americans have had it with the austerity model," added Larry Cohen, the president of the Communications Workers of America. "We're not going to work our way out of this by cutting the living stands of working Americans. That's a failed method. It's been a dead method for 75 years, and it's being revived by those on this other [White House] commission."

Robert Kuttner, senior fellow at Demos and editor of The American Prospect, said that the citizens' commission report flies in the face of a stacking of the deck in the favor of austerity economics fueled largely by a multimillion-dollar campaign funded by Wall Street billionaire Peter G. Peterson.

As a result, "I don't think I have ever seen a time, as both a protagonist and a working journalist, where I've seen the media captured by one side of the argument," Kuttner said.

Kuttner warned that if the forces advocating attempting to cut their way to deficit reduction prevail, "You are only going to make the recession worse. It is not rocket science. It is basic economics."

"These recommendations again prove Beltway Insiders wrong—we don't have to force working people to pay the price for the failed economic policies of the past. The most effective way to regain our economic security and cut the deficit is by putting Americans back to work and restoring fairness to the our economy," said Mary Kay Henry, a citizens' commission member and president of the Service Employees International Union.

The group announced a nationwide campaign to oppose the job-killing, middle class-devastating, austerity measures proposed by Republicans in Congress, the President’s deficit commission co-chairs, such perennial deficit hawks as billionaire hedge-fund magnate Peter G. Peterson, and some Democrats.

“Not only is this citizen’s commission’s plan the right policy for our nation’s struggling economy, it is good politics,” said Robert Borosage, co-director of the Campaign for America’s Future. “Our proposals are overwhelming popular with the American people who cannot afford to have their job and retirement security fall victim to politics as usual in Washington.”

The Citizens’ Commission report was written by Jeff Madrick, a member of the commission and Senior Fellow at the Roosevelt Institute, with contributions from Dean Baker of the Center for Economic and Policy Research, Roger Hickey, Robert Borosage and Richard Eskow of the Institute for America’s Future, Robert Kuttner of The American Prospect and Demos, and Robert Pollin of the Political Economy Research Institute, and additional work by other members of the commission.

The full membership of the citizens' commission:

• Robert Borosage, Campaign for America's Future
• Dean Baker, Center for Economic and Policy Research
• Deepak Bhargava, Center for Community Change
• Angela Glover Blackwell, PolicyLink
• Jeff Blum, USAction
• Darcy Burner, Progressive Congress Action Fund
• Larry Cohen, Communications Workers of America
• Teresa Ghilarducci, The New School - A New York College
• Heidi Hartmann, Institute for Women's Policy Research
• Mary Kay Henry, Service Employees International Union
• Rob Johnson, Institute for New Economic Thinking
• Joan Kuriansky, Wider Opportunities for Women
• Robert Kuttner, Demos and The American Prospect
• Jeff Madrick, New York University and Roosevelt Institute
• Dr. Julianne Malveaux, Bennett College
• Terry O'Neill, National Organization for Women
• Robert Pollin, University of Massachusetts
• Robert Reich, University of California Berkeley
• Justin Ruben, MoveOn
• Sen. Don Riegle, Former U.S. Senator from Michigan
• Charles Rodgers, New Community Fund
• Karen See, Coalition of Labor Union Women
• Deborah Weinstein, Coalition on Human Needs

# # #