The Ghost of Ronald Reagan

American Economics Politics

As the morality tale of the 2012 USA presidential election plays out, the decision we are all making together is often spun in the media as a referendum on Barack Obama, or as an appraisal of Mitt Romney. But the real historical significance of this election may turn out to involve a President who was elected 32 years ago. In 2012, we may finally manage to exorcise the ghost of flawed economics represented by the legacy of Ronald Reagan.

This is not to say that American citizens will ever stop revering Ronald Reagan, who stands at the very top level of the American cultural/mythological pantheon, along with George Washington, Elvis Presley and Jesus Christ. (Indeed, it's funny that conservatives often mock liberals like me for "worshipping" Barack Obama, because we never worship Barack Obama the unabashed way that conservatives worship Ronald Reagan.) The fond memory of Reagan is probably the strongest glue that currently unifies the whole wide Republican/conservative community, from the libertarians to the Tea Partiers to the bankers, from Ron Paul to Michelle Bachmann to Rick Santorum to John Boehner to Mark Levin. Reagan's immense popularity stands on three main pillars, and two of these pillars will survive the 2012 election debacle. One of the three will not.

Reagan will always be lovingly remembered for his confident approach to foreign policy, which is credited with bringing down the Soviet Union and at least half of the global Communist revolution. He will also always be fondly remembered for his sunny personality, so upbeat that even a liberal like me must occasionally smile back in acceptance (though, really, I never saw his charisma the way others did.)

It's a sure thing that these two pillars will always stand, that America will always love Ronald Reagan. But it seems that we are finally coming to terms with the painful fact that the third pillar of Reagan's legacy, the economic ideology known variously as supply-side economics, trickle-down economics or Reaganomics, is a complete failure. Its record could barely be worse.

Reaganomics, rooted in the economic writings of Ludwig von Mises, Friedrich von Hayek, Ayn Rand and Milton Friedman, is the idea that small government will create a thriving economy, that low taxes and permissive pro-business regulatory policies will produce a greater natural flow of success and growth than any central government policy ever could. Major tax cuts will turn out be revenue neutral, because individuals and businesses will pay taxes on greater amounts of base profit. The level of success will be so great that the poor and needy will have ample new opportunities to work hard and thrive, making social services like Medicaire and Social Security less essential.

Reaganomics looks exciting on paper, but it has never worked in practice. There was growth following Reagan's tax cuts, but the level of growth was never even close to the amount needed to make the tax cuts revenue neutral. Taxpayers were not paying what the government was spending, and the numbers did not add up. By the time Reagan left the presidency, he had burdened the United States with its worst budget deficit in history.

But this first failure of practical economics -- you cannot claim to be against federal budget deficits and also claim that Reagan was good for the USA economy, because Reagan invented the modern massive federal budget deficit -- barely dented the enthusiasm of Reaganomics's champions. After the blissfully sensible Bill Clinton/Newt Gingrich cooperation team finally managed to balance the federal budget in the late 1990s, a familiarly sunny "new Reagan" from Texas named George W. Bush was elected to give trickle-down economics a second try. This second try worked out even worse than the first.

We learned with Bush's second try -- the Bush tax cuts, the various deregulation programs -- that trickle-down economics does not only lead to horrific federal budget deficits and increased wealth disparity between the top 1% and the rest of the country. It also leads to shameful, ruinous corruption, shocking irresponsibility and complete financial incompetence in the deregulated business sector.

And yet the Republican party still looks for "new Reagans" every election season. Jack Kemp was a "new Reagan" when he ran for Vice President in 1996. George Allen of Virginia was a "new Reagan" before he made the foolish mistake (Ronald Reagan, a truly talented politician, rarely made these kinds of mistakes) of insulting an opposition journalist with a racial slur while the guy was obviously recording him on video. Early in the 2012 presidential race, a cowboy named Rick Perry sauntered up and tried to stage-manage some Reaganesque charisma, to hilarious and embarrassing effect. He had the barrel chest just right, but couldn't produce the smile, and also didn't have the brains.

But let's not forget that Mitt Romney was also originally seen as Reaganesque -- an upbeat personality, success-oriented, business-minded, a charismatic (yes, people once thought Mitt Romney was charismatic) optimist. It seems incredible today to realize that only a few years ago, Mitt Romney's similarities to Ronald Reagan were his main selling point.

Today, a month before election day, Mitt Romney appears to be a damaged candidate, and is certainly unfit to be President. His character was not strong enough to stand the test of a tough campaign, and many ascribe Mitt's public failures to basic flaws in his personality. I think this is a misperception. He is probably an okay guy deep inside.

Mitt's soul is not the source of his problem; the problem is that he has allowed his soul to be possessed by political ideas that have gone rotten. Try to avoid making gaffes when defending Reaganomics in 2012 -- you would probably make as many gaffes as Romney! It's an impossible position to uphold, because you can't sound sincere when spouting trickle-down policies during an economic crisis that has left the wealthy class untouched while the middle and lower classes suffer. It's impossible not to get tongue-tied when you are beholden to wealthy donors who insist you support a lie.

This, I believe, is why Mitt Romney has collapsed as a viable candidate. His running mate, the brutally enthusiastic Objectivist Paul Ryan, also seems to be collapsing as a credible candidate, as can be seen in this video of an interview with Chris Wallace.

Wallace has asked Paul Ryan to provide some hard facts to support the tax cut proposal that is part of the Romney/Ryan plan, and then stubbornly refuses to allow Paul Ryan to slither away as Ryan tries to do everything except answer the question. Exasperated, Ryan finally declares that "it would take too long for me to go through all the math."

Ryan and his televised math puzzle may even amount to the last gasp of the ghost of Reaganomics, a ghost that we will hopefully be putting to rest forever after election day. If we're lucky enough to remember the lessons we've learned, that is. Reaganomics, rest in peace.

(Thanks to J. J. Chandler's awesome Tombstone Generator for helping me create the image on this page!)

9 Responses to "The Ghost of Ronald Reagan"

by TKG on

Mitt Romney was not a Reagan supporter. He distanced himself from Reagan back in the day.

Romney was never what they call a movement conservative. That's a weakness for him. People remember.

It's also interesting to read how media generated scandal and misinformation and lies has become collective memory, eg George Allen using a racial slur. That was utter nonsense and 100% made up. It is scary and amazing how complete lies are generated and by force of information monopoly and lack of any objective or independent thought allows such things to happen. Scary groupthink in supposedly intelligent and sophisticated people.

(That he never made a racial slur doesn't mean he wasn't a doofus)

by Levi Asher on

TKG, the reason Romney once distanced himself from Reagan is the same reason that he once supported legalized abortion: he was running for governor of Massachusetts, and has always been willing to say whatever he thought was necessary to get elected. In 2012, he is clinging tightly to the Reaganomics line, because it's what he needed to do to get the Republican nomination, and it's also what his wealthy donors demand. He supports a continuation of Bush's tax cuts for the wealthy (an explicitly Reaganesque program), deregulation and deficit spending as required to keep tax rates low. What about his program in 2012 do you find different from the Reaganomics playbook? As far as I can tell, he is running on the Ronald Reagan economic program, word for word, just like George W. Bush did. If you can identify a single part of the Romney/Ryan economic plan that isn't consistent with trickle-down economics, please do so.

About George Allen and "macaca" -- I don't know what you mean about it being a lie. I distinctly remember that George Allen apologized for the slur. He wouldn't have apologized if it was a lie.

by Eamon on

Strong point about Romney being hostage to the lie his wealthy donors demand. I would definitely agree that Reaganomics is still the main economic philosophy of the right.

It's just not the year for conservatives. I remember saying that about the liberals in 2004 when security was the main issue and the Bush boys rode that train right back to DC.

Eamon

by TKG on

You are right about Romney and his "Pragmatism".

This is why he is a weak candidate. The conservative base does not strongly support him. Some vow to never vote for him.

Reaganomics has zero to do with non support for him on the right conservative Republican side. And of course the left would not support Romney even if he were a full out socialist like Obama.

by Levi Asher on

I agree, TKG. I think the Republicans could have challenged Obama a lot harder if they had been able to find a better candidate.

But I don't think this was a matter of luck or chance. I think a party gets the candidate it asks for, and the Republican party in 2012 is so riven with internal strife and conflicting ideologies that it could not possibly settle on a ticket with a coherent message. Thus we have: Mitt Romney and Paul Ryan.

As for Obama ... I still think it's bizarre that anyone calls him a socialist. If being a moderate Democrat liberal with the same views as the majority of other Democrat liberals makes you a socialist then it must be true, but in any case he's no more socialist than any other Democratic party politician.

Reagan has a legacy so distorted by the Conservative idolization of him that we may never have a clear picture of the real man behind the television set beyond the elaborate myth now concocted around him. Did he really rid the world of commie scum? Did destroy or save our economy? Check out my portrait of The Gipper and help me figure it out on my artist’s blog at http://dregstudiosart.blogspot.com/2011/02/happy-100th-gipper.html with some Cold War Hollywood!

by Michael.Norris on

The Republicans are basically hypocrites. They talk about smaller government, but look what they do - look at George W's massive, bloated Department of Homeland Security. Can anyone think of a more intrusive government body, or a better example of what Republicans are always complaining about in government? No, for them small government is code for getting rid of regulations on businesses and Wall Street.

Second - Reaganomics. Remember when Bush Père called if "Voodoo Economics"? HW was right. Milton Friedman's ideas about trickle down have been disproved. After years of this notion that the only thing you can do with taxes is cut them - that a tax increase will somehow cause the Apocalypse - what do we have? A massive deficit and a huge imbalance between rich and poor. And no job growth. I maintain that the economy has been bad since the 2000 tech bubble burst, and the speculative frenzy prior to 2008 just masked a weak economy that was not creating enough jobs, coupled with the massive outsourcing and offshoring of what jobs there were.

Third. The current Republicans (with some exceptions who seem to be dwindling fast) are not conservatives. Conservative means to keep what you have. These politicians are reactionaries. They don't want to keep what we have. They want to roll things back to before progressive policies made things better for a majority of Americans. They want to go back to the time when there was no Social Security, no Medicare, no Voting Rights; back to the time when the rich ruled and the rest worked until they dropped dead.

Finally, our economy is changing. I see a future where more and more people will be self-employed. This can mean a decent life if these workers have access to affordable health care and pay into a system (Like we are doing now - we pay into Social Security and Medicare - these are not government hand-outs.) that provides a safety net for economic downturns and old age. And, we have to change the acceptance that CEOs and other top earners can make huge amounts of money while the lowest worker in his corporation is paid a minimum wage. I personally don't care how much anyone makes, but I do care about fairness. Is it fair when one pig pushes all the others away, gobbles up the best feed, and leaves the others to fend for themselves? This is in the nature of pigs, not men.

by Dan Harper on

You're correct to call Reagan a "politician". (Nixon, who was the smartest conservative of his generation, was actually a Keynesian.) Reagan cut the taxes of the most wealthy from 70% to 30%. He also put teeth in Nixon's "war against drugs" policy. But in the 1980s, it effectively turned into a war against black people. Does anyone remember that Reagan wanted a treaty with the USSR that would unite the two superpowers if an alien invasion were to take place? The key to Reagan's weird, Only-in-America career in politics was BAD FAITH. He was a New Deal Democrat who had to change sides before Nancy's family would accept him as a son-in-law. Later, he claimed he believed FDR had America headed toward socialism. If only.

by hypcollector on

...romney seems to want to be president so bad, it is weird. he might get it just so americans can have a break from his campaigning. in the end, the guy is just weird, and his judgement is suspect. i believe. the presidency of the united states has a track record of right man at the right time. surely lincoln would fit this category, as would washington (the ultimately humble man who resisted being king), jefferson (who better to navigate our foriegn policy infantcey and lend credibility to americans because of his personal aaccomplishments and impressiveness), jackson (the people take the house back, literally), the forgotten maze of late 1880's presidents that let industry thrive. talk about turning a blind eye and corruption. teddy was my personal favorite, truly a man of the people. and national parks. a true leader who fought in hand to hand combat. finally tamed this new industry called industry. a civilized start anyway. but all were flawed in very incredible ways. anyone prior to lincoln let slavery slide. reminds me a bit of our current attitude toward abortion. shameful and a future historical blackmark on this country. like slavery. anyway, roosevelt nurtured us back from economic collapse and finally confronted hitler. but his response was slow. our modern presidents certainly fit this trend of fortunate timing. truman (the guts to end the war II, including firing mcaurther and not continuing the war into china), ike (perfect guy to lead the baby boom and suburban explosion and he wasn't scared of no reds!), kennedy (the restlessness had a hero, and a celebrity), LBJ (as a former teacher, he knew poverty in rural texas and only he could have sold the great society to congress), nixon (he knew asia and he ended the dumb war), ford (who better to bring back some levity after nixon's pathetic end), carter (continuing the need for trust, he was too honest and sincere to be an effective president. good man, that carter. if there is such a thing. rather, and as he would likely describe himself, a sinner who occasionally overcomes himself and does good things.), reagan (the russians felt he was a little off his rocker, which he was, and that made american even more formidable. the crazy man has the codes! his economic policies created huge wealth, despite it's flaws. look at the dow from reagan to now. the graph is impressive and moves in the right direction as time has passed. the peaks and valleys is where all the heartbreak lies. where greed and fright create vast opportunities for the emotionally stable. allocate/diversify/rebalance. most people chronically do not understand rebalancing. not perfect, but not discredited socialism or disgracful communism. many think that socialism is the humane governmental design, but it leads to apathy, contentment, and ridiculous discussions about fairness.), bush/sr (iraq would have owned kuwait and fought the saudis. the iron wall falls down.), clinton (who better to compromise, but the islamic militant misses were a disaster and his horndogness was a white house disgrace. preying on 21 year old interns. what a jack. mr lewinsky is a putz.), W (wanted dead or alive, just what the public wanted to hear), and barak (diversity america has a hero. smooth and principled. the right's hatred of him is thier main weakness. he's a liberal. ok, he does what liberals do. he seemed tired of being president and i don't blame him. he probably wishes romney wasn't so weird, he has 4 more years of presidential aging ahead of him.). in summary, reagan was reagan, jimmy is jimmy, bill is bill, w is w, and barack is barack. God bless Texaco.

*unedited

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