The Real Reagan Economy

by MICHAEL WALKER

Since the start of the presidential primary campaign, Republican candidates have missed few opportunities to laud the achievements of conservative hero and former president Ronald Reagan, or to portray themselves as his worthy successor. As Michele Bachmann declared after the Iowa caucuses, “What we need is a candidate in the likeness and image of a Ronald Reagan…What we need is a fearless conservative, one with no compromises on their record, on spending, on health care, on crony capitalism, on defending America, on standing with our ally Israel.”[1]

Mitt Romney and Newt Gingrich have also invoked Reagan as an example of a model president. They have contrasted what they see as his superior handling of the economy with the woes suffered during President Obama’s tenure. In an op-ed published by the Wall Street Journal in December, Gingrich, who proudly touts himself as a “Reagan conservative”, wrote of an economic “nightmare” in America, which “will not end until Reagan-era economic policies are restored.” One such policy is “spending controls”.[2] Frontrunner Mitt Romney has likewise expressed his admiration for the “smaller government policies of the Reagan era [which] helped turn around a struggling economy and create millions of jobs.”[3]

It seems to me that these Republicans are suffering from some form of amnesia, whose effects appear to have been amplified by the onset of the election season. For, regardless of the “smaller government” claim made by Romney, the reality is that President Reagan went on a spending blitz during his two terms in office, running up colossal budget deficits worthy of a European tax-and-spend socialist, while repeatedly promising to balance the budget.

The staggering debts accrued by Reagan’s administration were due in large part to an explosion in military spending, which shot up by a whopping forty percent between 1980 and 1984. By the time he left office the man who, in Bachmann’s words, had made “no compromises” on spending had somehow succeeded in adding well over a trillion dollars to the national debt, and had turned the United States from the world’s largest creditor to its largest debtor. Not once did Reagan come close to balancing the budget.

Even Reagan’s own officials acknowledged that the national debt had ballooned to nightmarish proportions. David Stockman, who served as Director of the Office of Management and Budget until 1985, stated privately that “We are violating badly, even wantonly, the cardinal rule of sound public finance: governments must extract from the people in taxes what they dispense in benefits, services and protections.” He added that “If the Securities and Exchange Commission had jurisdiction over the executive and legislative branches, many of us would be in jail.”

There is a chasm separating the Republican presidential candidates’ own remarks on the urgency of reducing the present government debt from what occurred on Reagan’s watch. For instance, on Mitt Romney’s campaign website, it states that “Washington is spending money in an out-of-control fashion” and “we must live within our means, spend only what we take in, and pay down our debt.” Had these words been spoken in the 1980s, when Reagan was in charge, they would not have been at all out of place.[4]

The same goes for Newt Gingrich’s comment that, were he to become president, he would “cut federal spending in half over the long run.”[5] This is diametrically opposed to what President Reagan accomplished.

There is of course one way to reconcile the apparent contradiction between the Republicans’ enthusiasm for Reagan-era economics and their own remarks on the need to bring down the current, very high US debt. As the late president himself once said, “If it comes down to balancing the budget or defense, the balanced budget will have to give way.” I suspect this maxim would ultimately be followed by a President Romney or Gingrich, notwithstanding their declared determination to rein in spending. Romney is indeed committed to significantly increasing the defense budget, and plans to pour billions of dollars into modernizing the air force, building more ships, improving services for veterans and adding “at least 100,000 active duty personnel to our military payroll.”[6]

To sum up, when the name of Ronald Reagan is brought up by a Republican presidential candidate, it is wise to take what they say with a grain of salt. The Reagan they invoke is not the spendthrift budget-buster who plunged the US into unprecedented levels of indebtedness, but a mythical figure who made “no compromises” on his conservative principles. One thing is for sure, however: if a Republican defeats Obama in November, he’ll have as much trouble balancing the budget as the Gipper.

Michael Walker has a PhD in International Relations. He has written articles for Foreign Policy in Focus, openDemocracy and Colombia Journal.

NOTES.

Will Falk moved to the West Coast from Milwaukee, WI where he was a public defender.

Like What You’ve Read? Support CounterPunch
July 29, 2015
Mike Whitney
The Politics of Betrayal: Obama Backstabs Kurds to Appease Turkey
Joshua Frank
The Wheels Fell Off the Bernie Sanders Bandwagon
Conn Hallinan
Ukraine: Close to the Edge
Stephen Lendman
What Happened to Ralkina Jones? Another Jail Cell Death
Rob Wallace
Neoliberal Ebola: the Agroeconomic Origins of the Ebola Outbreak
Dmitry Rodionov
The ‘Ichkerization’ Crime Wave in Ukraine
Joyce Nelson
Scott Walker & Stephen Harper: a New Bromance
Bill Blunden
The Red Herring of Digital Backdoors and Key Escrow Encryption
Thomas Mountain
The Sheepdog Politics of Barack Obama
Farzana Versey
A President and a Yogi: Abdul Kalam’s Symbolism
Norman Pollack
America’s Decline: Internal Structural-Cultural Subversion
Foday Darboe
How Obama Failed Africa
Cesar Chelala
Russia’s Insidious Epidemic
Tom H. Hastings
Defending Democracy
David Macaray
Why Union Contracts are Good for the Country
Virginia Arthur
The High and Dry Sierras
Jon Langford
Mekons Tour Diary, the Season Finale, Mekonception in Redhook
July 28, 2015
Mark Schuller
Humanitarian Occupation of Haiti: 100 Years and Counting
Lawrence Ware
Why the “Black Church” Doesn’t Exist–and Never Has
Peter Makhlouf
Israel and Gaza: the BDS Movement One Year After “Protective Edge”
Carl Finamore
Landlords Behaving Badly: San Francisco Too Valuable for Poor People*
Michael P. Bradley
Educating About Islam: Problems of Selectivity and Imbalance
Binoy Kampmark
Ransacking Malaysia: the Najib Corruption Dossier
Michael Avender - Medea Benjamin
El Salvador’s Draconian Abortion Laws: a Miscarriage of Justice
Jesse Jackson
Sandra Bland’s Only Crime Was Driving While Black
Cesar Chelala
Effect of Greece’s Economic Crisis on Public Health
Mel Gurtov
Netanyahu: An Enemy of Peace
Joseph G. Ramsey
The Limits of Optimism: E.L. Doctorow and the American Left
George Wuerthner
Bark Beetles and Forest Fires: Another Myth Goes Up in Smoke
Paul Craig Roberts - Dave Kranzler
Supply and Demand in the Gold and Silver Futures Markets
Eric Draitser
China’s NGO Law: Countering Western Soft Power and Subversion
Harvey Wasserman
Will Ohio Gov. Kasich’s Anti-Green Resume Kill His Presidential Hopes?
Jon Langford
Mekons Tour Diary, Episode 4, a Bowery Ballroom Blitz
July 27, 2015
Susan Babbitt
Thawing Relations: Cuba’s Deeper (More Challenging) Significance
Howard Lisnoff
Bernie Sanders: Savior or Seducer of the Anti-War Left?
Martha Rosenberg
Big Pharma’s Profiteers: You Want Us to Pay What for These Meds?
Joshua Sperber
What is a President? The CEO of Capitalism
John Halle
On Berniebots and Hillary Hacks, Dean Screams, Swiftboating and Smears
Stephen Lendman
Cleveland Police Attack Black Activists
Zoe Konstantopoulou
The Politics of Coercion in Greece
Patrick Cockburn
Only Iraq’s Clerics Can Defeat ISIS
Ralph Nader
Sending a ‘Citizens Summons’ to Members of Congress
Clancy Sigal
Scratch That Itch: Hillary and The Donald
Colin Todhunter
Working Class War Fodder
Gareth Porter
Obama’s Version of Iran Nuke Deal: a Second False Narrative