Sunday, April 28, 2013

The Reagan Myth

Fifty years ago, Ronald Reagan famously quipped, "I didn't leave the Democratic Party; it left me."

In 2013, while the Grand Old Party high fives efforts to stifle background checks legislation in Congress as solace for the empty feeling of losing the last two presidential elections, many people are beginning to argue that Reagan's quote could now be applied to the Republican Party.  The latest salvo comes from Washington Post writer Jennifer Rubin who says "Tear Down this Icon: Why the GOP Has to Get Over Ronald Reagan."  It's a rather moderate position and analysis, at least in the eyes of moderates in and out of the party who lament the government's seeming inability to get anything done these days.

The legacy of Ronald Reagan should be open to debate - as should any president's.  Yet, with the near messianic devotion some Republicans place upon the Reagan years, it's actually quite apt to review the facts on the 1980s.  The primary issue is one of nostalgia and looking at the past without the benefit of context.  One of the first people to adequately address the disconnect is political journalist Will Bunch who warned the Republicans in 2010 to Tear Down this Myth: The Right Wing Myth of Ronald Reagan.  Bunch's analysis is certainly written with bias, but his arguments are not entirely invalid.  The Reagan years were not the Golden Age, and the Reagan tax cuts are not the only thing anyone needs to know about fiscal policy and strong economic times.

Clearly, the world and the economy did not simply change with the election of Reagan in 1980 and the passage of the 1981 and 1983 tax cuts.  The national and international economy is so much more complicated than that.  For one, there is a monumental and not replicable difference between dropping marginal taxes rate from a stratospheric high of 80% to 30%.  The effect is bound to be dramatic - though other factors also played equally significant roles in reviving the stagnant 1970s economy.  The lesson for Republicans comes from the law of diminishing returns.  Just as effective tax rates have a ceiling, they also have a floor.  And dropping rates by 6 or 8 percentage points will not have the same effect as dropping them nearly 50%.  They may even do more damage, as seen by the exploding deficit and debt under Reagan, Bush II, and Obama.

A more palatable source for Republicans should be (but probably isn't for the true believers) former Reagan domestic advisor Bruce Bartlett.  Bartlett is considered by many to be a primary architect of "Reaganomics," but he has valid criticism of the current GOP and the revisionism regarding the Reagan agenda and legacy.  Bartlett outlined the reality in The New American Economy: The Failure of Reaganomics and a New Way Forward.  Obviously, it was never simply about supply side tax cuts.  The economy turned around in the 1980s, though not really until Reagan's second term.  And the economic rebound had as much to do with the basic end of inflation and the dropping of interest rates engineered by Paul Volcker as it did with taxes.  Other factors in the 1980's economic boom had to do with new oil discoveries in Mexico and the North Sea that effectively busted OPEC and basically "fueled" the boom.

Ronald Reagan was a great president, no doubt.  But much of the current Republican message is based on myth and misinformation.  And the GOP would do as well to understand Reagan the moderate deal-maker who raised taxes eleven times during his presidency.

**NOTE - For a bit of commentary regarding charges of "revisionism" and myth about the presidency of George W. Bush - in the midst of his presidential library dedication - consider checking out and cross referencing Alex Seitz-Wald's criticism "How to Debunk George W. Bush's Attempts at Revisionism" published in Salon.

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