Billionaire Peter G. Peterson evangelizes about perils of debt with ‘I.O.U.S.A.’

By Carol Eisenberg

July 15, 2008 at 9:05am

Can an iconoclastic Republican billionaire do for the national debt what former Vice President Al Gore did for global warming?

Blackstone Group co-founder and former Commerce Secretary Peter G. Peterson says he’s going to try - and he’s put $1 billion of his own money into an effort to inform Americans that their nation is going broke.

His new Peter G. Peterson Foundation has bought the rights to a feature-length documentary, I.O.U.S.A., which opens in 10 cities around the country Aug. 22. Directed by Patrick Creadon, who shot Wordplay about crossword enthusiasts, the film dramatizes the peril of the country’s debt, which is now about $9.5 trillion and growing every day, according to the Bureau of Public Debt, an arm of the U.S. Treasury.

The film portrays a disastrous economic future as 78 million baby boomers start to retire and draw Social Security benefits until the national debt is triple the size of the current economy, or $175,000 for every American, according to the foundation.

“We’re not going to be just another think tank,” the 82-year-old Peterson last week told an elite group that included David Rockefeller and former Secretary of State Henry Kissinger. “Our mission is to create awareness and to bring Americans together to achieve real results. Why is that so difficult?”

Besides releasing the film, the foundation is distributing more than $5 million in grants to organizations that create tools to help young people learn about personal and public finance, and that help citizens and business leaders demand change from their elected officials, according to a press release.

Peterson is no stranger to controversy. A commerce secretary to former President Richard Nixon who went on to become chairman of the Federal Reserve Bank in New York, he made a huge fortune when the private equity firm he helped found, the Blackstone Group, went public last year. But despite his ties to Washington power brokers, he has often spoken out against what he considers ill-advised economic policies.

In a meeting with President George W. Bush and a group of Wall Street executives several years ago, he reportedly stunned the new president by questioning the wisdom - and morality - of the administration’s tax cuts.

“I said, ‘Sir, as I look at these fat cats around this table, I wonder about the morality of what we’re doing here - because while we’re getting tax cuts, our kids are going to get huge tax increases, because of our largesse,’ ” as Peterson tells it, going on to talk about how tax cuts without spending cuts are simply a deferred tax increase on coming generations.

The son of Greek immigrants and father of five who married Sesame Street creator Joan Ganz Cooney, Peterson has also been forthright in recent years in his view that the Republican Party has lost its moorings.

“I remain a Republican, but the Republicans have become a far more theological, faith-directed party, not troubling with evidence,” he said in a 2004 interview with Mother Jones magazine. Although he has endorsed John McCain for president, he said his efforts to control the debt are bipartisan.

I.O.U.S.A. focuses on Robert Bixby, director of the Concord Coalition, a nonpartisan group focused on fiscal policy, and David Walker, the former U.S. comptroller-general, as they tour the United States to inform voters about the perils of the national debt.

It features interviews with investor Warren Buffett and former Federal Reserve chairmen Alan Greenspan and Paul Volcker, as well as with Robert E. Rubin, treasury secretary under Bill Clinton.

Peterson said he believes that particularly in a presidential campaign year, the candidates must be forced to face the real issues.

“I say to my kids and their friends, ‘Hey, kids, it’s your future, not mine. I’m in great shape myself. And are you going to take responsibility for your future and get out there and get involved in the political process, get educated?’”

Click here to see a preview of I.O.U.S.A:

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