Who's The Better Reagan?
It's Not Who You May Think
The year 2011 marks the 100th anniversary of Ronald Reagan's birthday. There is no one more revered in the conservative iconography than Reagan, and perhaps no one currently more reviled by hard-core conservatives than President Barack Obama. The time seems perfect for an objective comparison of the policies of these two presumed opposites of the political spectrum.
To be fair and accurate, since Obama has completed only two years of his term, we'll limit our actual policy comparisons to Reagan's first two years as well. However, to gain a more complete picture of each President's political ideology, personal and public statements made outside those time frames have also been considered. Since the purpose of this hub is to determine "who is the better Reagan?" all comparisons will be made in the context of Reagan's actual policies or declared intent.
We'll begin by first examining each President's tax policies. It's taken as gospel that Ronald Reagan was an enthusiastic tax cutter. However, after cutting taxes in 1981, Reagan raised them in 1982 (on businesses) and again in 1983 (on employee payrolls). Like Reagan, Obama has also lowered taxes. Yet, unlike Reagan, he has yet to raise them. Let's compare the specifics after two years in office:
Reductions in the tax rate on capital gains (the profits from stocks, bonds and real estate) are one of the holy grails of conservative tax policy. Reagan was somewhat successful in this area, lowering them to 20% for individuals by midway through his first term. However, Obama has managed to "out-Reagan" the 40th President, achieving an even lower 15% individual rate (to be fair, this rate was established by George W. Bush, but if not for a deal directly negotiated by Obama, it would have expired). With regard to capital gains, the "better Reagan" turns out to be the current President. WINNER: Obama.
Aside from capital gains, lowering the estate tax is the most cherished objective of those who subscribe to Reaganomics. How do Reagan's first two years stack up against Obama's on this point? By 1983, Reagan had managed to lower the top rate to 60% with a minimum threshold of $3.5 million. Yet here, also, Obama managed to do more. Not only did he lower the top rate to 35% (it was scheduled to rise to 55%), he raised the threshold to $5 million ($10 million for couples). Thus, fewer people will be taxed on their inheritance, and they'll be taxed at a lower rate. WINNER: Obama.
The income tax rates are another important focus of "Reaganomics," especially with regard to the richest Americans. After a year in office, Reagan did manage to decrease the top marginal rate to 50%, the lowest rate in fifty years. However, Obama has managed to top Reagan in this category as well, preserving the current top marginal rate of 35% (again, set to expire if not for Obama). WINNER: Obama.
Who's the better Reagan with regard to payroll taxes paid by employees? It's really no contest. Reagan raised them, to 5.4% (and even higher in subsequent years, but we're only counting the first two). Obama lowered them, from 6.2% to 4.2% WINNER: Obama (by a landslide).
Speaking of payroll taxes, they provide the funding for the Old-Age, Survivors, and Disability Insurance (OASDI), more commonly known as Social Security. Nearly two decades before George W. Bush attempted to partially privatize Social Security, Ronald Reagan proposed the same idea. Yet, as President, political circumstances forced him to raise payroll taxes to shore up the program.
Barack Obama, on the other hand, recently decreased payroll taxes as part of his negotiated tax deal with Republicans in Congress. Not only will this reduce the funding for Social Security, making it more vulnerable, it will enable Republican opposition in two years when the new rate expires, when they can portray the expiration as a "tax increase" on working Americans.
Republicans (including Reagan) have largely opposed the program since it began back in 1935. Yet, in one fell swoop, Obama has accomplished what every one of them has thus far failed to do: He has begun the dismantling of Social Security. WINNER: Obama.
One of the foundations of Reagan's governing philosophy was expanding the U.S. military to confront and undermine Soviet hegemony. To that end, he actively supported anti-Communist insurgencies in Afghanistan and Nicaragua and invaded the Caribbean island of Grenada. Obama has largely maintained George W. Bush's wars in Iraq and Afghanistan, obstensibly to confront and undermine worldwide terrorism. Still, Reagan gets points for initiating his own military actions, with a clear underlying objective. Obama has merely continued his predecessor's muddled military adventures. WINNER: Reagan.
However, in total Defense Department spending, Obama has far outpaced Reagan. Even adjusting the figures for inflation, Reagan's defense budget in the second year of his administration was $429.15 billion. Obama's 2011 defense budget is a whopping $708.2 billion. To be fair, Obama's budget does include two ongoing wars, but he's had two years to reduce those military commitments. At best, he's merely shifted resources from one war zone (Iraq) to another (Afghanistan), and has done nothing at all to reduce America's global military presence. WINNER: Obama.
The Categorical Winner
In almost every category that defines Ronald Reagan's early administration, Barack Obama has implemented policies that have outpaced his earlier predecessor. Reagan was for lowering taxes, especially for the wealthy, and Obama has uniformly achieved even lower rates. Reagan disliked Social Security, but it's Obama who's finally managed to hammer the first nail in its coffin. Reagan believed in an expanded military, but it's Obama who has maintained two wars and increased the Defense budget to historic new levels. Additionally, with his bailouts of the banking and automotive industries, Obama has done more to advance the idea of "trickle-down" economics than Reagan could ever dream.
One could argue, I suppose, that the political culture in Washington DC has moved significantly to the right since Ronald Reagan's day, and Barack Obama is simply working within the prevailing reality. However, that argument fails on two counts. First, Barack Obama was elected largely because of his campaign theme of "change." His promise to radically alter the business of Washington included specific pledges like resisting tax breaks for wealthy Americans and reducing America's military commitments, ideas contrary to the very policies that Reagan embraced.
Second, if Obama's policies have merely followed a Washington paradigm shift to the right, why is he so often called a "socialist" and even a "communist" by those who cherish Reagan's legacy most? If Washington politics since Reagan's day have shifted so far rightward that Obama's policies are still considered "socialist" by comparison, what does that say of Reagan's policies?
Either Ronald Reagan has been left behind by the very rightward drift he helped create, and is by comparison a "socialist" himself, or the Washington paradigm has not drifted so far from Reagan, after all, and Obama's record stands on its own as an amplification of Reagan's agenda. Either way, with regard to Reagan's own policies, Obama's example consistently proves more "Reagan-ish." Barack Obama is, in all relevant measures, the "better" Reagan.