Published on Sunday, July 10, 2011 by Al Jazeera
Reagan Mythology is Leading US Off a Cliff
During Reagan's presidency, the
went from a creditor to debtor nation and marked a take-off for financial inequality. US
As things stand today, the
Because of this hypnotism,
The first is to ignore the debt ceiling, relying directly on the 14th Amendment's statement that
In anything close to a sane world, either one of these two bold strokes would be widely hailed for avoiding a reckless threat to the still-fragile world economy. But we do not live in a sane world, and the idolatry of Ronald Reagan is one of the principle reasons why. This is why it behooves us to review some of the principle lies involved with Ronald Reagan's record, focusing specifically on the economy. What follows is but a brief rundown.
The idea that Reagan produced a uniquely booming economy is false
First, Reagan's record on the economy was not just exaggerated by his boosters, it's almost exactly the opposite of what they claim. It was a fairly ordinary time by the most common measurements of economic growth, looking good only in comparison with a selective time-slice of the 1970s. But once you start looking beneath the surface even the tiniest bit, the picture turns very dark indeed.
In terms of the most basic measure of economic growth - increase in gross domestic product (GDP) - the vaunted "Reagan boom" was an unremarkable period of time. If we look at Reagan's eight years, and compare them with
The idea that Reagan brought prosperity is true only for those at the top, not for average American workers
If we examine incomes, we discover that Reagan's eight years marked a real take-off for inequality, while average incomes stagnated. The income growth of the top once per cent was ten times that of everyone else during his term
The idea that Reagan was good for the American economy in general is false
Reagan was a disaster for the American economy in at least four fundamental ways
Debtor Nation Status
The debt-to-GDP ratio is much more significant than the debt alone, since the GDP represents the nation's total capacity to pay off the debt. And from WWII to 1981, the debt-to-GDP ratio fell from almost 120 per cent down to just down to just 32.5 per cent. The sharpest drop came early on, but even during the supposed "big government" heyday of the Kennedy/Johnson years, the ratio fell by over 16 per cent in eight years. Conservatives then might have complained about the debt - and they certainly did - but no one knowledgeable about economics took them seriously, because the debt grew significantly slower than our ability to repay it.
During Reagan's term, this changed dramatically. The ratio rose by over 20 per cent, and it rose another 13 per cent under his successor, George Bush Sr. It took a Democrat, Bill Clinton, to get the ratio headed down again - by almost 10 per cent during his two terms, before Bush Jr sent it skyrocketing again - by almost 28 per cent. It's rising fast under Obama as well - but that's to be expected as a result of the worst recession since the 1930s.
The idea that Ronald Reagan consistently opposed tax increases is false
The idea that Ronald Reagan always opposed tax increases is completely untrue. He raised taxes dramatically as Governor of California in 1967 - by a whopping 30 per cent. But he also raised them as president - 11 times. Sure, his 1981 tax increase, along with three smaller increases, was much larger than his total tax cuts. But his willingness to raise as well as lower taxes would have made him at least somewhat compatible with President Obama, and totally unacceptable to movement conservatives today, especially Tea Partiers.
Bruce Bartlett was a leading supply-side economist in the 1970s, who helped draft the Kemp-Roth tax bill as a staff economist for Congressman Jack Kemp. He went on to serve in both the Reagan and Bush I administrations. In an April 2010 blog post, listing Reagan's 11 presidential tax hikes and four tax cuts, Bartlett wrote
The idea that Reagan's tax cuts spurred job creation is false
As noted in
The idea that Reagan changed
Political scientist James Stimson, author of Public Opinion in
This rise was reflected, for example, in four questions asked in the General Social Survey, the most-cited data source for social scientists after the US Census. Between 1980 and 1990, the number of people saying the government was spending "too little" nationally increased 27.4 per cent on health care, 32.9 per cent on education, 67.8 per cent on welfare and 46.7 per cent on the environment. The questions all reminded people that increased taxes might be required if more was spent.
What's more, 20 years after Reagan's election, in 2000, federal tax receipts as a percent of GDP were up 8.4 per cent over what they had been the year Reagan was elected, indisputable proof that government's role had ultimately not decreased across that time-span.
The idea that Reagan was a singularly popular president is false
Reagan was quite fortunate in getting re-elected in 1984 when his popularity was particularly high, but that was not true of his record in general. According to
Surveying all these lies in a single panorama, it should be clear that neither Reagan's economic record nor his political one should provide any case at all for embracing conservative economics. Quite the opposite
President Obama is as drunk on Reagan's kool-aid as anyone else in
One thing about Reagan is true, however
© 2011 Al Jazeera
Paul Rosenberg was a frontpage blogger for OpenLeft.org and is now Senior Editor for Random Lengths News, an alternative bi-weekly in the Los Angeles Harbor Area, where he specializes in labor, community and environmental justice issues.
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"The master class has always declared the wars; the subject class has always fought the battles. The master class has had all to gain and nothing to lose, while the subject class has had nothing to gain and everything to lose--especially their lives." Eugene Victor Debs