Barack Obama's timing could not have been worse. His thinly veiled comparison of himself to Ronald Reagan comes at a time when the US is poised precipitously at the brink of what may be the longest, deepest recession since Reaganomics ushered in a two year long depression back in 1982.
I think Ronald Reagan changed the trajectory of America in a way that Richard Nixon did not and in a way that Bill Clinton did not. He put us on a fundamentally different path because the country was ready for it. I think they felt like with all the excesses of the 1960s and 1970s and government had grown and grown but there wasn't much sense of accountability in terms of how it was operating. I think people, he just tapped into what people were already feeling, which was we want clarity we want optimism, we want a return to that sense of dynamism and entrepreneurship that had been missing.--Barack Obama, Washington Post
"When you think about what Ronald Reagan did to the American people, to the middle class to the working people," former Sen. John Edwards shot back at an event in Henderson, Nevada. "He was openly -- openly-- intolerant of unions and the right to organize. He openly fought against the union and the organized labor movement in this country...He openly did extraordinary damage to the middle class and working people, created a tax structure that favored the very wealthiest Americans and caused the middle class and working people to struggle every single day. The destruction of the environment, you know, eliminating regulation of companies that were polluting and doing extraordinary damage to the environment."Edwards added, "I can promise you this: this president will never use Ronald Reagan as an example for change."When I think about what Ronald Reagan did to this nation, I think of how he struck at and perhaps killed-off a viable labor movement. I think about how middle class families made homeless lived under bridges and overpasses in boomtown Houston. I think about how Reagan, like Bush, waged a phony war on terrorism during which terrorist attacks increased some three fold. I think about how Ed Meece waged a war on porn even as a gay prostitution ring operated right out of the White House. I think about how Ronald Reagan neutered affirmative action, the fairness doctrine, and the industries that had kept the middle class in the middle class. I remember how Ronald Reagan was worshipped by the gullible who remembered Reagan's reign at the Republican National convention of 1992: "Reagan made us feel good about ourselves", they swooned. It was not so long ago that Bush played guitar while New Orleans drowned and in doing so, Bush became the symbol of his own failures. Nothing had been learned from the Reagan experience. The intellectually bankrupt GOP can be counted on to repeat failed strategies in the expectation of a different outcome. Bush stays the failed course amid warnings that our nation is falling apart at the seams heading for third world status and catastrophe. The warnings come amid the valid assessment that Bush's tax cut for the rich failed to make good on two empty promises: it did not trickle down or prime the economic pump and it did not pay for itself as Bush himself had promised it would. Just one year after Congress bowed to Bush and passed the tax cut of 2001, the Brookings Institution would write:Washington Post, Obama's Reagan Comparison Sparks Debate
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The official federal budget outlook has deteriorated dramatically since early 2001, due to last year's tax cut, the economic slowdown, and the terrorist attacks on September 11, 2001. In addition to the pressures from the long-anticipated increase in entitlement spending as the nation ages, the government now also faces growing spending needs for defense and homeland security. These trends imply that future taxes must rise, future spending outside of defense and the elderly must decline, or obligations to the elderly and to defense be reduced.But GOP supply side, trickle down economics also promises more opportunity, a growing economy, more jobs.-Alan Auerbach, William G. Gale, and Peter R. Orszag, June 2002, The Budget Outlook: Options for Restoring Fiscal Discipline, Brooking Institution
Some in Washington say we had to choose between cutting taxes and cutting the deficit....Today's numbers show that that was a false choice. The economic growth fueled by tax relief has helped send our tax revenues soaring. That's what has happened.But that's not what happened. Wealth has never trickled down and there is no "higher pie". A Treasury Department analysis refuted Bush directly, confirming in its analysis what many experts and Bush critics had been saying all along: tax cuts do not come remotely close to paying for themselves. [PDF] . In other words, the two promises of "trickle down" theory are dead wrong: wealth does not trickle down and tax revenues do not increase to make up the short fall.-George W. Bush
As Dizzy Dean said: it's deja vu all over again! Why does the GOP insist upon repeating failed strategies. Reaganites promised that the stimulated economy would outgrow the deficit and the budget would be balanced "...within three years, maybe even two." It didn't! Reagan tripled the deficit and, on the way, he doubled the size of the federal bureaucracy. Reagan's tax cuts were followed promptly by the longest and worst recession since Herbert Hoover's Great Depression. As Robert Freeman correctly points out: "...Jimmy Carter's last budget deficit was $77 billion. Reagan's first deficit was $128 billion. His second deficit exploded to $208 billion. By the time the "Reagan Revolution" was over, George H.W. Bush was running an annual deficit of $290 billion per year."
How will Bush compare to Reagan? By the year 2002, Citizens for Tax Justice were already writing:
Over the ten-year period, the richest Americans-the best-off one percent-are slated toBy 2010, when (and if) the Bush tax reductions are fully in place, an astonishing 52 percent of the total tax cuts will go to the richest one percent-whose average 2010 income will be $1.5 million. Their tax-cut windfall in that year alone will average $85,000 each. Put another way, of the estimated $234 billion in tax cuts scheduled for the year 2010, $121 billion will go just 1.4 million taxpayers.
Although the rich have already received a hefty down payment on their Bush tax cuts-averaging just under $12,000 each this year-80 percent of their windfall is scheduled to come from tax changes that won't take effect until after this year, mostly from items that phase in after 2005.
1968 was the year in which measured postwar income was at its most equal for families. The Gini index for households indicates that there has been growing income inequality over the past quarter-century. Inequality grew slowly in the 1970's and rapidly during the early 1980's. ...Generally, the long-term trend has been toward increasing income inequality. Since 1969, the share of aggregate household income controlled by the lowest income quintile has decreased from 4.1 percent to 3.6 percent in 1997, while the share to the highest quintile increased from 43.0 percent to 49.4 percent. Most noticeably, the share of income controlled by the top 5 percent of households has increased from 16.6 percent to 21.7 percent. Over the same time period, the Gini index rose 17.4 percent to its 1997 level of .459.-Income Inequality, Census Bureau
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