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Another Curious Omission

The Fiscal Times and Social Security
September 10, 2010

Edmund Andrews, a senior writer for The Fiscal Times, has given us an interesting story about the 800-pound gorilla of Washington politics—the AARP. The online news service, which produces stories about fiscal policy, is funded by Peter G. Peterson, the force behind the current drive to restructure Social Security. (Peterson is also a CJR funder.) And so it makes sense that The Fiscal Times would write about a group that could either help or hinder that effort.

Writing that the AARP “appears to be on a collision course with the 18-member deficit panel,” Andrews notes that the panel’s co-chairs, Erskine Bowles and Alan Simpson, have “warned that Social Security is on a path to insolvency and signaled that any fix should involve both cuts in future benefits and increases in the payroll tax.” Simpson has “repeatedly warned that Social Security was already nearly bankrupt,” and Bowles, although he “has used less flamboyant language,” has also “warned that the system is unsustainable.”

What Andrews’s story did omit, however, was some crucial history about Alan Simpson and the AARP, which seems important for anyone wanting to understand why AARP, at least for now, might be sitting on the fence. That seemed to be the theme of the piece. Andrews reported:

Like many liberal groups, the AARP is against measures to cut Social Security as a way of reducing the budget deficit, which the group says it didn’t cause. But the group has signaled an openness to adjusting the program’s tax revenues and spending in order to shore up its long-term fiscal stability.

Then came several graphs detailing some AARP historical tidbits. During the Clinton administration, the AARP and the Concord Coalition were close to agreeing on a package of Social Security changes until the Monica Lewinsky scandal rose higher on the public agenda. In 2005, the group tripled its lobbying budget to $36 million and supported a heavy advertising campaign against the privatization proposals of George W. Bush. Last year, the AARP helped defeat a Senate bill that would have established a deficit commission similar to the one the president created in January by executive order, and this year it quietly declined to testify at one of the commission’s open meetings. After Simpson’s now-infamous e-mail analogizing Social Security to a milk cow with thirty million tits, AARP questioned the commission’s credibility, but did not call for Simpson to resign.

Here’s where the missing history and context come in, and why they should be useful for journalists who will cover this story for the rest of the year. In the mid-1990s, Simpson, as chair of the Senate Finance Committee’s subcommittee on Social Security and family policy, picked up the attacks made on the organization by conservative think tanks worried that AARP could block their efforts to cut Medicare and Social Security.

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One group, the Capital Research Center, which tracked the funding sources of nonprofit groups engaged in public interest advocacy, launched a frontal assault on AARP and the now-defunct National Council of Senior Citizens. As I reported in my book, Slanting the Story—the Forces That Shape the News, the Capital Research Center struck at the intersection of AARP’s business and advocacy interests—the tax exemption which “allows the group to sell products and avoid paying taxes on the profits as long as those profits are related to activities that benefit its members.” The media quickly passed along the attacks—and so did Simpson.

Simpson, who disagreed with the AARP’s positions on Medicare and Social Security, believed the group was obstructing budget cuts that Republicans needed to make in order to offset a planned round tax cuts. Simpson held hearings on the AARP’s finances. “I’m a chairman. I can have hearings,” he boasted to reporters in the Capitol corridor, dancing a little jig and pumping his arms in the air. A few days before he announced the hearings, Simpson said “People ought to know where their money comes from and what it’s used for.” As I reported at the time, Simpson never produced a smoking gun, but he created plenty of smoke, focusing on irrelevancies like the size of AARP’s new building and its executives’ salaries.

But the AARP recognized what the hearings were really about. At a meeting with AARP’s board and staff, Simpson told them “I want you to know that the intensity of my investigation will be directly related to the intensity of your fight on Medicare.” In an interview then, AARP’s chief lobbyist John Rother told me: “Many people on the right wing realized that AARP was the force to contend with. They realized they wouldn’t get anywhere unless they dealt with us as an institution.”

Apparently they have. As former AARP CEO Bill Novelli told The Fiscal Times, “AARP always tried to take a rational approach. They believe you have to work both sides of the equation. Everything has to be on the table.”

Given that Simpson and others threatened AARP’s very existence so directly, it’s hardly surprising the group did not call for his resignation a few weeks ago. Perhaps they’re afraid that if they play hardball with Simpson, Simpson and others will play hardball with them. Nor is it surprising that Novelli, in his new role as a Georgetown University professor, has joined the Concord Coalition’s Bixby, Peterson Foundation CEO David Walker, and others on a road show this fall billed as a “Fiscal Solutions Tour.”

Nor is it curious that Rother just a few weeks ago told Laura Meckler of The Wall Street Journal that acting sooner allows for changes to be made gradually, and will reassure younger workers that the program will be there for them. Meckler reported that Rother dismissed those who said they can never support benefit cuts. Shortly after the Journal story appeared, AARP sent out a backpedaling statement from Rother with a headline “AARP Reaffirms Strong Opposition to Cutting Social Security Benefits to Reduce a Deficit It Did Not Cause.” No one has really said it did. Now how’s that for fence-sitting?

In reporting this story, context means everything, as every journalist should know.

Trudy Lieberman is a longtime contributing editor to the Columbia Journalism Review. She is the lead writer for CJR's Covering the Health Care Fight. She also blogs for Health News Review and the Center for Health Journalism. Follow her on Twitter @Trudy_Lieberman.