Unimpeded by Setbacks, the CEO Debt Fixers March On

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From L to R: JPMorgan vice-chairman Jimmy Lee, Fix the Debt co-chair Erskine Bowles, Pete Peterson, Fix the Debt co-chair Alan Simpson, Goldman CEO Lloyd Blankfein, JPMorgan CEO Jamie Dimon, Honeywell CEO David Cote, Willett Advisors chairman Steve Rattner Photo: Getty

You might think that after the last-minute resolution of the fiscal cliff drama — after the “come together” Starbucks cups and the New Year's Eve all-nighter that resulted in a deal to avert the worst of the immediate tax hikes and spending cuts that were due to commence on January 1 — the 100-plus high-ranking business executives who helped steer the “Fix the Debt” movement would have called it quits and gone back to their day jobs.

After all, what happened in Washington in the early hours of 2013 represented a near-total defeat for the deficit-hawk movement. Despite the use of a reported $43 million war chest to carry out a massive PR blitz, Fix the Debt's efforts produced no grand, bipartisan bargain that coupled higher tax revenue with spending cuts and entitlement reform. (In fact, the bill President Obama eventually signed did nothing at all to address long-term deficits, other than raising a bit of tax revenue.) The bond market is shrugging off the so-called "fiscal crisis," leading many to question whether long-term deficits are actually compromising the nation's finances. And the dire warnings of the group's "CEO fiscal leadership council," a confab that includes elder statesmen like Goldman CEO Lloyd Blankfein and JPMorgan CEO Jamie Dimon, were mostly ignored by politicians on Capitol Hill. Indeed, the first and only time many people heard of Fix the Debt was in December, when a video of co-chair Alan Simpson doing the "Gangnam Style" dance went viral.

Even Pete Peterson, the godfather of the deficit-hawk movement that bankrolled Fix the Debt, seems to have given up on the group, saying in an interview with the Washington Post last week that he was “not totally aware of the impact [the CEOs] are having right now.”

Yet improbably, Fix the Debt is still very much alive, according to several top executives who have taken part in the movement. It wants what it has always wanted: a major, bipartisan plan to lower the nation's long-term deficits by raising tax revenues, cutting spending, and making major changes to Medicare, Medicaid, and Social Security. And like the Energizer Bunny, it will keep going and going, even if doing so is no longer productive or even prudent.

“The endpoint was never January 1,” Maya MacGuineas, Fix the Debt's president, now says. “We have a ton of new CEOs, and of the ones who are involved, there’s so much frustration and realization that this is going to be an ongoing push.”

According to several executives, Fix the Debt — which is led by Simpson and fellow deficit-hawk Erskine Bowles — is still urging its well-heeled members to raise more money and recruit more of their high-ranking friends into the fold. Morale suffered after the fiscal cliff deal, and several members have scaled back their commitments to the group in the New Year, according to these executives. But the movement refuses to die. Since the New Year, the prominent venture capitalist Reid Hoffman and JetBlue CEO David Barger have joined up, and high-level strategy sessions have continued apace in a series of private dinners and closed-door meetings.

"It’s been very spirited, with everyone saying, ‘We’re going to redouble our efforts,’” said one executive who recently attended a private Fix the Debt dinner at the New York home of a prominent business leader. “CEOs are really banding together to encourage Congress to do the right thing."

But Congress doesn't appear to be listening, a fact that irks many movement stalwarts. At the private dinner, one CEO council member suggested that everyone at the table stop writing checks to any politicians — regardless of their party affiliations — until “people start to listen” to each other. The suggestion was greeted with a group “amen,” according to the executive who attended.

Fix the Debt was always a bipartisan movement that wanted both higher tax revenues, and long-term cuts and reform to programs like Medicare and Social Security. But the deal that was signed on January 1 did nothing about entitlements, giving Fix the Debt's second phase a bit of a one-note feel.

“We didn’t get what we wanted, which was spending cuts,” one CEO council member said.

“The next piece is going to have to focus on entitlements,” MacGuineas concurs.

One man who still believes in Fix the Debt's message is Nikhil Deogun, the editor-in-chief of business news for CNBC. Under Deogun’s direction, CNBC last fall began running a branded promotion called “Rise Above,” in which it pushed for politicians to move past their differences and strike a comprehensive, long-term deficit-reduction plan. In order to throw its weight behind a grand bargain, CNBC commissioned thousands of “Rise Above” pins, which it gave to guests and staffers to wear on the air, and placed a “fiscal cliff countdown” clock on the lower third of its screen.

But rather than folding "Rise Above" once the fiscal cliff deal was struck and the clock ran out, CNBC reupped it with a new name: “Rise Above: The Debt Threat.” Now Deogun says he’ll continue pushing for a comprehensive deficit-reduction deal until it happens.

“The reactions from our viewers have been very positive,” Deogun says. “We’ve already been doing a fair amount [of the new campaign], and starting next week you’ll see more."

Deogun wouldn’t say how long he planned to keep the revamped promotion going, though he did say that the network has "about 1,000" Rise Above pins left in its original stash and is prepared for a long haul. “We’ve started being a little more judicious in how we hand them out,” he said.

As for the rest of Fix the Debt, the effort will continue for as long as the movement has money and enthusiasm. MacGuineas has taken the lead in keeping the CEO troops revved up, even staying home from a planned family vacation to Europe in order to keep holding conference calls and meeting with lawmakers. Even after all the group's setbacks, she says she has no plans to let up until a deal is reached. Asked when she planned to take a vacation, MacGuineas sighed.

“That’s a question I would really like the answer to,” she said. “I’d like to see my kids.”