Re-Writing the Reagan Legacy

July 02, 2011

by: Les Carpenter
Rational Nation USA
Birthplace of Independent Consergvatism
Liberty -vs- Tyranny

Steve Benen wrote an interesting article in today's edition of the Washington Monthly in which he stated President Reagan was actually to the left of President Obama. His specific reference was with respect to the reality Reagan raised taxes in seven of eight years he was in office.

A point readily made by Benen, and supported by his data is that Reagan raised taxes more than any other peacetime President in American history. What Benen does not focus much time nor specifics on is Reagan's record of immense job and economic growth during his Presidency.

There is no question that some of Benen's assertions are true. There is also no question but what he is citing the Reagan record selectively and using it to support the Obama agenda as negotiations on deficit reduction, tax increases, and the debt ceiling are in process. In short... politics and journalism as usual.

Excerpt from the Washington Monthly.

It should cause no shortage of frustration for congressional Republicans that President Obama is in line with the Reagan legacy — and they’re actively rejecting it. Politico’s David Rogers had a fine piece of reporting touching on this point yesterday.

With the nation at risk of default next month, the Republicans’ fierce anti-tax orthodoxy is running square into the Ghost of the Gipper — the GOP’s great modern, pre-tea party hero, Ronald Reagan.

Indeed, a POLITICO review of Reagan’s own budget documents shows that the Republican president repeatedly signed deficit-reduction legislation in the 1980’s that melded annual tax increases with spending cuts just as President Barack Obama is now asking Congress to consider.

Rogers’ analysis found that the tax increases Reagan agreed to, as part of negotiations with a Democratic Congress — increases that included raising the gasoline tax and payroll taxes — are actually bigger than anything the Obama White House is proposing now. (On taxes, this puts Reagan slightly to Obama’s left.) For that matter, it’s also worth noting that the conservative Republicans of the 1980s were absolutely certain that Reagan’s policy would destroy the economy, and as part of the right’s unyielding track record of failure, they were wrong.

The larger point, though, is that when the 40th president sat down with lawmakers to work on debt reduction, he accepted as a given that the agreement would include a combination of spending cuts and tax increases. The debate would be over the ratio. Indeed, it’s one of the reasons Reagan ended up raising taxes in seven out of the eight years he was in office. (Remember, “no peacetime president has raised taxes so much on so many people” as Reagan.)

What’s more, Reagan’s views on the debt ceiling weren’t exactly vague.

In a November 1983 letter to then-Senate Majority Leader Howard H. Baker Jr. (R-Tenn.), Reagan warned that without a higher debt ceiling, the country could be forced to default for the first time in its history.

Reagan wrote: “The full consequences of a default — or even the serious prospect of default — by the United States are impossible to predict and awesome to contemplate. Denigration of the full faith and credit of the United States would have substantial effects on the domestic financial markets and the value of the dollar.” {Read More}

Reagan was both an actor and a politician. He understood the art of negotiation having been President of the Screen Actors Guild as well as the necessity of compromise. Both Obama and congressional members would do well to learn both.

What Benen did not do was present a balanced and complete view of the Reagan legacy. While his assertions are true in certain respects there is much he did not say. As almost all opinion columnist do he selectively presented information to support his argument and by extension give support to Obama's position in the current debate. Benen obviously feels he can strengthen his argument by using selective examples of President Reagan's record to do so.

Benin failed to mention the regulatory relief Reagan was responsible for that increased American productivity. He did not give proper credit to Reagan for his steadfast support of private sector business and the economic growth it obviously resulted in. Nor did he mention the 35 million new jobs created during the Reagan economic boom.

Reagan while not reversing the growth of Leviathan, {this writer believes Reagan realized he would not be able to do so}, did significantly slow the growth trajectory in government that had preceded him.

For a balanced view on the Reagan years one should read, consider, and understand the following. Brief excerpt below.

Tax Policy, Economic Growth and American Families
Introduction

Over the past decade and a half, Americans have been presented with two radically different visions of the role of government. The first vision, articulated and implemented by President Reagan in the 1980s, declares that government taxation and burdensome regulations are harmful to the natural market forces that generate economic growth. Since economic growth is the only way to truly create jobs and raise incomes, policies that reduce taxes and government intervention are the keys to higher living standards for all Americans.

President Clinton espouses the second vision, which maintains that the expansion of government does not have harmful effects on the economy and, in fact, may actually be a source of economic growth. Proponents of this vision believe that it is largely through government policies that people can be made better off. According to this vision, tax increases, such as those enacted in 1990 by President Bush and in 1993 by President Clinton, are valid and effective means by which to achieve such policies. When tax increases are not politically feasible, continued deficit spending is the next-best alternative.

In one sense, President Clinton's fiscal policies are a continuation of the Bush Administration's fiscal policies -- both administrations sought to reduce the budget deficit by raising taxes. President Clinton's agenda, however, is far more harmful than his predecessor's, as evident by Clinton's massive 1993 tax increase, his attempt in 1994 to socialize health care, and Clinton's original budget plan this year that proposed hundreds of billions of dollars in new debt for the United States.

Clinton's tax-and-spend policies have been in place for almost three years and it is now possible to compare the record of the pro-economic growth policies advocated by Republicans to the pro-government growth policies of President Clinton and the Democrats. The best comparison of these policies is a side-by-side examination of the economic recovery under President Reagan in the 1980s and the current recovery under Presidents Bush and Clinton.
Summary

With four years of data on the current economic recovery (extending back to the Bush Administration), it is now possible to tally up the scorecard and compare the Bush/Clinton recovery that started in 1991 with the Reagan recovery that began in 1982.[1] President Clinton has boasted that his policies have spurred economic growth, added jobs, and helped the middle class. However, the data show that the Bush/Clinton recovery is weak compared to the Reagan recovery along several important measures. Both economic growth and job creation in the current recovery lag behind the Reagan recovery by two full years. The middle class is suffering an actual loss in real median family income, while during the Reagan recovery it gained. Moreover, tax revenues increased more rapidly under Reagan's tax cuts than under the Bush/Clinton tax increases.

The most outstanding policy differences between the two recoveries are in the realm of tax policy. Reagan instituted across-the-board reductions in tax rates, while Bush and Clinton both pushed massive tax increases. The most disturbing conclusion is that the 1990 and 1993 tax increases have cost Americans far more than the extra earnings collected by the IRS; they have cost the economy at least two years of growth. Comparing the two recoveries:

Real GDP grew more in five years under Reagan (23 percent cumulative growth) than it is projected to grow in seven years under Bush/Clinton (21 percent cumulative growth).

After four years, 4 million more jobs were created under Reagan than under Bush/Clinton.

Federal revenues, adjusted for inflation, grew much faster under Reagan (33 percent cumulative growth) than projected under Bush/Clinton (20 percent cumulative growth).

Real per capita disposable income grew more in two years under Reagan than in all four years combined thus far in the Bush/Clinton recovery (8.2 percent versus 7.8 percent).

Median family income grew in all of the first three recovery years under Reagan, compared to three consecutive declines under Bush/Clinton.

In other words, during the economic expansion following Reagan's tax cuts, the economy grew faster, experienced stronger revenue growth, created more jobs, and saw more rapid income growth than the current expansion under the high tax policies of Presidents Bush and Clinton. {Read The Balance}

As much as the progressive revisionists love to rewrite history facts are facts. The only thing debatable is how one interprets the facts. The progressive record of interpreting history is frankly not all that reliable.

Cross posted to the Left Coast Rebel

Via: Memeorandum