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“Social Security is Broke”—and Other Corporate Scare Tactics

For years, corporations have been peddling myths to rally us behind their interests. Here are three things everyone “knows,” and why they're wrong.

Guy Fawkes photo by Stephen O'Byrne

A demonstrator at Occupy Wall Street shows how corporations talk. Their “speech,” Lisa Graves says, has left us believing a lot of things that aren’t true.

Photo by Stephen O'Byrne.

Winston Churchill reportedly said, “A lie gets halfway around the world before the truth has a chance to put its pants on.” That was before corporations had perfected the art of public relations, investing millions of dollars in PR campaigns to advance their commercial and political interests.

The fact is, there are a number of things most people know are true—except they’re not. That’s the result of well-planned, well-funded, long-term propaganda campaigns designed to make people believe things that are against their own best interests.

#61 Cover

More articles from 9 Strategies to End Corporate Rule, the Spring 2012 issue of YES! Magazine.

One relatively new example is the climate denial industry, which is funded by some of the richest corporations and CEOs on the planet to protect their profits from regulations that would address climate change. Although it’s one of the biggest threats we have ever faced, an increasing number of Americans believe there is widespread disagreement in the scientific community about climate change.

But that’s not true—there is actually widespread scientific agreement on climate, and a few dissenters, most paid in some way by the oil industry. Millions of dollars have been spent to create the appearance of disagreement, including deployment of so-called experts and even TV meteorologists to repeat talking points favored by big oil.

In the past year, the Internet and social media have brought together social movements across the globe, and there are signs that, in this new information age, people are breaking through the fog of corporate disinformation. But some of the “facts” have been repeated for so many years that a lot of people still think they are true.

“Social Security is Broke”

The Cass City Chronicle (Jan. 22, 1976)

For more than 30 years, opponents of Social Security have peddled this lie.

The roots of the efforts to attack Social Security run deep in the far right. They include CEOs such as Fred Koch, who promoted the John Birch Society’s red-scare-era smears that such New Deal reforms were “socialist” or “communist.” In the 1970s, Fred’s sons, Charles and David, inherited his billions—and his ideas. Charles began funding think tanks to develop arguments for dismantling Social Security.

David ran for vice president on the 1980 Libertarian ticket with a platform that included privatizing Social Security. Since then he’s spent millions on groups to push disinformation about Social Security and promote an array of sophisticated corporate propaganda. The donations of Koch Industries and others to groups like the American Legislative Exchange Council (ALEC) that promote claims that Social Security is going broke have paid off. Also, as detailed in SourceWatch, billionaire Peter Peterson has pledged a billion dollars to attacking Social Security. And, guess what? Almost all the current crop of GOP presidential candidates have called Social Security a scam.

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The truth is that Social Security wasn’t broke in 1976, and it’s not broke today. According to trusted actuaries, in about 25 years Social Security could face a shortfall—a gap that would allow it to pay most but not all of the earned benefits—unless it’s fixed.

One easy solution is to apply Social Security taxes to all earned income. Under the current system, any wages over the first $106,800 are exempt from Social Security withholding. If we close this loophole soon, the potential shortfall would be solved. Only about 6 percent of Americans earn that much, and removing this exemption would help ensure that the other 94 percent have the protection of this basic social safety net for decades to come.

Tort Reform “Creates Jobs”

—Wisconsin Gov. Scott Walker, ALEC alum

The first controversial bill Gov. Walker signed into law last year wasn’t his union-busting effort but a “tort reform” package he claimed would “create jobs.” This omnibus bill, which included numerous items that echo “model” bills from the ALEC bill factory, was rushed through so fast most folks barely had time to read it. But the U.S. Chamber of Commerce immediately applauded the bill and so did ALEC. Such legislation is on the wish list of the global corporations funding these groups and many politicians.

Tort reform is a made-up phrase that really means changing the rules for Americans killed or injured by corporations or other defendants. It’s been making its way through states across the country based on claims that it will create jobs, protect access to medical care, and bring down insurance rates.

But legal changes like those in Wisconsin make it harder for Americans to hold a company or careless physician responsible for all the damages caused by their negligence. Such changes make it harder for juries to punish companies to help deter egregious and deadly corporate acts.

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Such bills are often pushed based on claims that corporations fear getting “unfairly” sued. But changes like those in Wisconsin have nothing to do with frivolous lawsuits. Caps on damages, for example, apply only after a jury of American citizens has heard the facts and found the company was responsible for the harm.

Plus, there is no conclusive evidence that these changes to the law create jobs. In Wisconsin, for example, Walker claimed his tort reforms and other changes would create 250,000 new private-sector jobs, but the state ended last year with five months in a row of job losses.

The reality is that surveys of local businesses about what would lead them to hire more people reveal that the answer is more sales, not less litigation. In Wisconsin, for example, in a survey of state businesses about what would improve business, tort reform was dead last.

Tort reform is just more of the race to the bottom, pitting state against state to protect their citizens the least. The reality is that ALEC and the U.S. Chamber are bankrolled by global corporations trying to pay American workers the least, provide workers the fewest rights and benefits, and compensate as little as possible for consumers who are injured.

Lives and livelihoods are the real costs of tort reform, which is being sold through calculated corporate disinformation. 

We Need the Keystone XL Pipeline for Our “Jobs and National Security”

—Jack Gerard, CEO of the American Petroleum Institute

The richest industry on the planet is putting money behind claims that controversial energy projects, from natural gas fracking to the Keystone XL pipeline, are essential to our national security. Americans are vulnerable to such claims as gas prices rise in response to another round of saber-rattling in the Middle East.

People have been bombarded with corporate-backed claims that national security demands immediate approval of the controversial Keystone XL pipeline connecting the Alberta, Canada, tar sands to the Gulf Coast in Texas. But the claims are misleading.

First, the crude oil from the dirty tar sands extraction process comes from Canada, not the United States, so the oil does not belong to the American people. The oil is not Canada’s either. Rights to it have been sold to multinational companies whose interest is the highest price.

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Second, take a look at the map of the proposed pipeline. Its target is the refinery world of Port Arthur, Texas, which is focused on exporting oil via the Gulf of Mexico. Refiners in Texas on board to process tar sands crude include Royal Dutch Shell, the Saudi government, and the French oil company Total. A Texas company, Valero, which operates in a “Foreign Trade Zone” in Port Arthur, which limits customs duties, has pitched investors on exporting the diesel from tar sands crude while importing gas to America.

Don’t believe the corporate propaganda on jobs either. In an earlier phase of the pipeline in South Dakota, almost 90 percent of the 2,500 jobs were filled by workers not from that state, and most of the jobs were low-wage and temporary, according to testimony from TransCanada, the pipeline’s developer.

To Tell the Truth …

These are just a few examples. If you want to find out more on these issues and corporate PR techniques, check out our research and resources at PRWatch.org, SourceWatch.org, and ALECexposed.org.

Despite the gloomy picture of the success of some of these propaganda campaigns, there is hope. The Keystone XL pipeline looked like a done deal. But demonstrations at the White House led by 350.org that resulted in 1,253 arrests, combined with citizen outcry in the heartland states the pipeline would cross, resulted in denial of the permit to build. The day after the Obama administration announced that decision, a group of politicians held a press conference. You guessed it: They said that stopping the pipeline threatened jobs and national security.

And, as economist Dean Baker points out, for all the hostile rhetoric over the years, Social Security is undamaged so far, although this guaranteed pension is difficult to live on alone, since it has not been fully funded by including all wages in withholding over the years.

We’re up against big, rich opponents. But at least if you know the truth, the next time you hear someone say, “Social Security is broke,” you can say, “No it’s not.” And even explain why.


Lisa Graves wrote this article for 9 Strategies to End Corporate Rule, the Spring 2012 issue of YES! Magazine. Lisa is executive director of the Center for Media and Democracy and publisher
of PRWatch, SourceWatch, BanksterUSA, and ALECexposed.org.

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