On April 27, President Obama’s fiscal commission convened its first meeting, kicking off a seven-month discussion among 18 panelists on ways the federal government can reduce the federal budget deficit and shrink the national debt. The next day, many of those same panel members, including co-chairs Erskine Bowles and former Sen. Alan Simpson (R-WY), attended a "Fiscal Summit" organized by the Peter G. Peterson Foundation to discuss the same issues. Talk about how to overcome deficits and the debt at the Peterson event, which centered on eviscerating the nation's social safety net, mirrored discussion at the commission meeting.

The inaugural meeting of the president's deficit commission lasted close to three hours and included testimony from Federal Reserve Chairman Benjamin Bernake, Office of Management and Budget (OMB) Director Peter Orszag, and former Congressional Budget Office (CBO) directors Rudolph Penner and Robert Reischauer, along with statements from each of the panel members. Throughout the meeting, most commission members – with the notable exceptions of Sen. Richard Durbin (D-IL) and Reps. Xavier Becerra (D-CA) and Jan Schakowsky (D-IL) – regurgitated the new conventional wisdom on Capitol Hill that current deficits and long-term debt are the same problem and that Congress must act immediately by attacking "entitlements," including Medicare, Medicaid, and Social Security.

The April 28 Peterson event, nicknamed the "Deficit Fest" by Huffington Post columnist Dan Froomkin, featured some of the same unexamined assumptions and misguided ideas thrown around by politicians of both parties the previous day. While there has been some talk about keeping all options on the table, as Froomkin notes, "the pillars of the Washington establishment" have only one "fully developed policy proposal," which "is that America's most successful social program needs to be scaled back so that it provides fewer people less money over a shorter period of time."

According to economist Dean Baker, Peter Peterson "is a Wall Street investment banker who has ... committed over $1billion of his wealth to this effort ... to cut Social Security and Medicare." Baker was part of a group brought together by the Campaign for America's Future – the political action arm of the Institute for America's Future, a progressive policy research institute – the same day as the president's fiscal commission meeting to highlight the ostensible level of Peterson's influence over the debt panel's priorities. Ironically, C-SPAN, the cable network of Congress and the executive branch, grouped the video of the president's fiscal commission meeting with the videos of the morning and afternoon sessions of the Peterson fiscal event together under the same post.

There are a few voices of moderation. Froomkin labeled Center on Budget and Policy Priorities (CBPP) Executive Director Robert Greenstein and Economic Policy Institute (EPI) President Lawrence Mishel as insurgents at the Peterson event. The columnist sympathetically notes that the former "repeatedly reminded the audience of the enormous cost of tax giveaways to the wealthy and corporations," and the latter "argued that cutting Social Security benefits, for instance by increasing the retirement age, would unduly affect lower-income people."

While support for Social Security and Medicare have always been robust, the "tinkering around the edges" approach of raising the age limit a little here and cutting a few benefits there has an exaggerated effect on the poor and minorities. As Mishel noted during the Peterson function, while "life expectancy grew a lot over the last few decades ... it only really grew for people in the upper half of the income distribution. People in the bottom half of the income distribution are not living longer." This means that lower-income folks, who usually lack the funds to adequately represent themselves in government, will get cut out from the social safety net, leaving middle- and upper-income individuals with the benefits.

Moreover, the problem with long-term debt growth is rooted in medical costs, not Social Security. Despite scaremongering rhetoric about the impending “insolvency” of Social Security, remediation of its funding issues would do little to pull the federal budget off its unsustainable course. If Congress takes no action, Social Security will continue to pay retirees their promised benefits until 2037, after which they are projected to receive 76 percent of their promised benefits. To correct this, Congress could increase the Social Security payroll tax from 12.4 percent to 14.4 percent. An even better solution, far more progressive in nature, would be to increase the limit on taxable earnings. Currently, the Social Security tax is paid only on the first $106,800 of each employee’s taxable earnings; increasing this amount could substantially mitigate the problem.

However, growth in health care costs, which the CBO projects to outpace economic (GDP) growth, will cause Medicare and Medicaid expenditures to increase from 9 percent of the size of the economy (in 2007) to 19 percent in 2082. While the combination of fully financing Social Security, Medicare, and Medicaid through deficit spending will cause the federal debt to equal over 1,100 percent of GDP in 2080, the CBO notes that Medicare and Medicaid will account for 80 percent of spending increases between now and 2035, and 90 percent of spending growth between now and 2080.