Making the case against Tom Steyer's increasingly likely run for California Senate earlier this week, I argued that Steyer should step aside for three reasons: First, the billionaire investor, climate activist, and Democratic megadonor would be a more effective advocate for action to combat global warming from the outside. Relatedly, I noted, the Democratic candidates looking at the race share Steyer's views on climate change, so it's unclear what he would bring to the race, other than a more intensive focus on the climate crisis. Finally, I wrote, Steyer would be nearly 60 come Election Day 2016, and he almost certainly has no future on the national stage; better to clear the way for younger, more promising candidates who could build up Senate seniority and potentially go on to seek higher office, as most observers expect newly announced candidate Kamala Harris to do someday.
But Steyer -- who spent $74 million trying to elect pro-environment Democrats last year -- is primarily known for his climate activism, there's a lesser-known chapter in the former hedge funder's political life. Like many fellow billionaires active in politics, Steyer is a big deficit hawk, and has allied with corporate-backed groups advocating deep cuts to the social safety net.
Steyer currently sits on the advisory council of the centrist Hamilton Project, a Washington-based think tank associated with such neoliberal luminaries as Clinton-era Treasury Secretary Robert Rubin (a co-founder who, like Steyer, sits on the advisory council) and former Obama administration budget director Peter Orszag, the group's founding director and now a vice chairman at Citigroup. Orszag also sits on the Hamilton Project's advisory council.
Since its founding in 2006, Hamilton has championed the standard neoliberal agenda of free trade and fiscal austerity. Touted as an anti-populist outfit, the group secured an appearance by then-Sen. Barack Obama at its inaugural meeting. In his speech, Obama railed against progressives intent on "defending programs the way they were written in 1938" and argued that policymakers needed to "modernize these programs to fit changing times," channeling the Third Way rhetoric espoused by key Hamilton figures like Rubin.
In addition to his advisory work at Hamilton, Steyer is a supporter of the Fix the Debt coalition, a group of mostly right-leaning business executives and other public figures who support cuts in social insurance programs like Social Security and Medicare as part of a "grand bargain" to reduce the federal budget deficit. Founded by former Sen. Alan Simpson (R-WY) and Clinton chief of staff Erskine Bowles, Fix the Debt considers deficit is the pet project of a decidedly comfortable elite, including figures who sit on the boards of GE, JPMorgan Chase and Morgan Stanley; advisers to Goldman Sachs; and lobbyists for the U.S. Chamber of Commerce. And Steyer.
In 2012, Steyer joined other corporate titans -- including Morgan Stanley CEO James Gorman, Dow Chemical head Andrew Liveris, Bain Capital managing partner Steven Pagliuca -- in signing a letter demanding that the president and members of Congress "join together to resolve one of the greatest challenges to America's future -- our unsustainable national debt."
Regrettably for Steyer and his fellow austerians, events haven't looked kindly upon their predictions of imminent crisis absent bold action to tackle debt and deficits. Interest rates on U.S. government debt remain remarkably low, indicating that investors see U.S. debt as a pretty safe bet. The federal budget deficit continues to tumble. Meanwhile, though the U.S. economy is growing at a healthy clip, Washington budget cuts have damaged the economy's performance in recent years, shaving an estimated 0.7 percentage points off economic growth since 2010.