http://archive.harpers.org/2013/05/pdf/ … NadYJwo%3D
F
ollowing heavy Democratic losses
in the 2010 congressional elections,
Barack Obama announced that he was
reading a biography of Ronald Reagan
to see how the great man had handled
his party’s whopping 1982 midterm
defeat. With the country mired in a
deep recession, Republicans had lost
twenty-seven seats in the House of
Representatives. But Reagan main
-
tained that recovery was around the
corner. By the following year, the econ
-
omy had bounced back and the unem
-
ployment rate, which in 1982 averaged
nearly 10 percent, had begun falling
sharply. Reagan easily won reelection
in 1984. Having experienced even
greater losses in the House, Obama
hoped that Reagan’s story would pro
-
vide a blueprint for his own political
recovery—and perhaps it did, since he
won reelection more comfortably than
many pundits had predicted.
The center-left historian Sean Wi
-
lentz has called the period from 1974
to 2008 the Age of Reagan. In his
book of that title, Wilentz expresses
his grudging admiration for how our
fortieth president transformed the
nation. “Reagan,” writes Wilentz,
“embodied a new fusion of deeply
conservative politics with some of the
rhetoric and even a bit of the spirit of
Franklin D. Roosevelt’s New Deal and
of John F. Kennedy’s New Frontier.”
But this embrace of progressive rheto
-
ric and spirit did not actually re ect
Reagan’s damaging policies, a fact
Wilentz can’t help but document. A
more accurate name for Wilentz’s
book—and for the era—might be the
Age of Cruelty.
The reverence in which Americans
of all political persuasion seem to hold
Reagan today is absurd. As president,
he created a phony—if romantic—
picture of America’s past, a schoolboy’s
ction of a country forged by indi
-
vidualism. From this ction came the
dream that we could return to an ear
-
lier moral order in which citizens were
supposedly freer. Of course, America
was
in part built by bold individualists,
but it was also built by government
investment in canals and railroads, in
public water and urban sanitation sys
-
tems, in highways, scienti c research,
free K–12 education, college subsidies,
and a legal system that encouraged
competition while protecting private
property. If Reagan brought Ameri
-
cans optimism, it was optimism based
on false hopes and misleading facts.
Wilentz’s Age of Reagan doesn’t end
with Reagan himself or even his suc
-
cessor, George H. W. Bush, because
the revived centrist outlook of the
Democratic Party carried Reagan’s
legacy through the Clinton years. The
party’s movement toward the center
brought with it concessions not only
to Reagan but also to Milton Fried
-
man, the right-wing economist whose
ideas served as the intellectual buttress
to Reagan’s
Reader’s Digest
ideology.
“In many ways Milton Friedman was a
devil gure in my youth, [in a] Keynes
-
ian household of economists,” Clinton
treasury secretary Lawrence Summers
said in a 2001 interview with PBS.
I grew to see the issue as more nuanced
as I was in school and ultimately have
come to have enormous respect for
Friedman’s views on a range of ques
-
tions. That’s a respect that is born of
the power of his arguments as one con
-
siders them more and more deeply.
Obama’s decision to place Summers
and other Clintonites at the helm of his
rst-term economic-policy team was an
early indication that his election repre
-
sented a continuation of Reagan’s in u
-
ence. And this spring’s budget debates
remind us yet again that the Age of
Cruelty continues. As a result of cuts
imposed by the sequester, discretionary
domestic spending could soon sink to
its lowest level as a share of the total
economy since the early 1960s, and the
burden of these cuts will fall squarely
on the poor. While the sequester tar
-
gets infrastructure, education, and
housing expenditures, ongoing budget
negotiations will likely cut entitlement
programs such as Medicare and Social
Security. Taken together, these cuts
would re ect an abdication by the gov
-
ernment of its responsibility to main
-
tain a decent society. This is Reagan’s
true legacy, advanced in different ways
by every occupant of the White
House—Democrat and Republican
alike—since his departure
almost a quarter century ago.
R
eaganite thinking has become
so pervasive that it may be dif cult to
remember an earlier time. As gover
-
nor of California, Reagan supported a
1973 ballot initiative that would have
amended the state constitution to
cap income taxes permanently. The
measure was voted down by almost
ten points. A healthy majority of
Californians didn’t want their taxes
cut, choosing instead to give their
government an adequate budget to do
its job. Five years later, however,
Proposition 13, a similar initiative
cutting and capping property taxes,
passed overwhelmingly. That same
year, New York representative Jack
Kemp and Delaware senator William
Roth proposed cutting federal in
-
come taxes by nearly 30 percent.
Reagan was not the cause of growing
anti
tax attitudes throughout the
1970s, but he distilled them potently.
The Kemp–Roth bill became the
model for what Reagan adopted and
got passed as president.
This change in sentiment came
during a time of soaring in ation. In
his nal debate with Jimmy Carter
before the 1980 election, Reagan said,
“We don’t have in ation because the
people are living too well. We have
in ation because the government is
living too well.” Americans appar
-
ently found this thinking convincing.
He had given them an easy scapegoat
for their growing frustrations: Wash
-
ington. In the process, he rede ned
our relationship to our government,
making Americans consumers rather
than citizens. They paid taxes not to
help others, it seemed, but to buy
something for themselves. If the indi
-
vidual bene t wasn’t apparent, then
the money should be withheld.
In his mania for reducing the size
of the federal government, Wilentz
notes, Reagan proposed slashing
spending on public assistance, food
stamps, school lunches, and job train
-
ing, among other programs. Senator
Ted Kennedy gathered enough votes
in Congress to block some of these
proposals, but many got through, and
the poor suffered as a result. Reagan
fought aggressively against af rmative-
action programs, and his Justice De
-
partment failed to enforce multiple
violations of the 1965 Voting Rights
Act. Clarence Thomas, his choice to
run the Equal Employment Opportu
-
nity Commission, ignored thousands
of complaints of job bias, including
age discrimination. He sharply cut
the budget of the Environmental Pro
-
tection Agency, and he aggressively
promoted oil and gas exploration on
federal lands. His Pentagon was
shockingly corrupt, as dozens of pro
-
curement scandals proved. He avoid
-
ed aggressive policies to address the
increasingly urgent public-health cri
-
sis presented by the AIDS epidemic.
The vision of the rugged frontiersman
riding bravely into the unknown led
to the worst kind of nancial deregu
-
lation, allowing savings-and-loan in
-
stitutions to invest clients’ money,
most of it federally insured, in almost
anything they chose. The industry
collapsed, requiring a taxpayer bail
-
out of more than $150 billion. Even
the economic expansion that re
-
turned him to office in 1984 and
made him a model for Obama was in
many respects a failure. While jobs
were created, average wages stag
-
nated, and inequality began its steady
climb to the levels of the 1920s.
Though Reagan argued that reducing
taxes was the key to business spend
-
ing, investment remained weak
throughout the decade.
During his presidency, Reagan sup
-
ported one useful social program that
helped the working class: the earned-
income tax credit. (Note that this was
in the form of a tax rebate, not a gov
-
ernment expenditure.) But his pri
-
mary legacy was an enormous federal
budget deficit, which has affected
policy decisions ever since. The great
-
er Reagan lie, known as supply-side
economics, was that tax revenues
would rise sharply enough to reduce
the budget de cit Jimmy Carter left us.
When Reagan left of ce, the de cit
was about three times Carter’s. Few
new social programs have been pro
-
posed since then, because deficit
hawks claim there isn’t
money to nance them.
I
f you doubt the harshness of Rea
-
gan’s policies, remember that George
H. W. Bush felt obliged to promise a
“kinder, gentler” government than
Reagan’s in order to get elected. The
elder Bush signed into law the Amer
-
icans with Disabilities Act, and he
eventually supported a tax increase
to close the de cit. Though this tax
hike hurt Bush badly in his failed
re
election campaign and helped
bring Bill Clinton to of ce, the major
achievement of Clinton’s own rst
term was raising income-tax rates on
the well-off. This was a solid attack
on the Reagan legacy.
But to win reelection in 1996, Clin
-
ton made a welfare-reform proposal so
severe that even Bob Rubin, his Wall
Street–groomed Treasury secretary,
opposed it. Reagan had begun preach
-
ing about the evils of welfare while
running for governor, and he coined
the phrase “welfare queen” in his 1976
presidential bid. Now Clinton hoped
to “end welfare as we know it,” in large
part through the creation of work re
-
quirements. His plan, Temporary
Assistance to Needy Families, seemed a
success in the strong economy of the
late 1990s and even during the moder
-
ate recession of 2001. But in the reces
-
sion of 2008, the oor fell out. Work
requirements were okay if there were
jobs, but now there were none. Ac
-
cording to the Center on Budget and
Policy Priorities, sixty-eight families
received TANF for every one hundred
families in poverty in 1996. By 2011,
the proportion had fallen to twenty-
seven families for every hundred. The
inability of parents to meet the work
requirements mandated under Clinton
meant far more children than before
were living in poverty.
One fact encapsulates Reagan’s im
-
pact on Clinton. As a candidate for
president in 1992, Clinton had been
enthusiastic about investing more in
transportation infrastructure; so when
the economic boom of the 1990s cre
-
ated a budget surplus, public works
seemed an obvious recipient of in
-
creased funding. But under Rubin’s
in uence, Clinton promised instead
to pay down the debt Reagan had built
up. By Clinton’s last year in of ce, the
federal government was spending less
on infrastructure as a percentage of
GDP than it had under Reagan.
Of course, Clinton’s debt trimming
was utterly undone by George W.
Bush, who proved more dedicated to
Reagan’s vision than to his father’s
kinder, gentler America. “I think he’s
the most Reagan-like politician we
have seen, certainly in the White
House,” said Michael Deaver, a former
Reagan aide. “I mean, his father was
supposed to be the third term of the
Reagan presidency—but then he
wasn’t. This guy is.” The younger Bush
cut taxes sharply, as we know, and
then started two wars without funding
them. In large part as a result of Bush’s
policies, the economic recovery that
followed the collapse of the dot-com
bubble was the slowest in the post–
World War II period. By Bush’s nal
year in of ce, the de cit had risen to
about $1 trillion—demonstrating yet
again that Reagan’s party isn’t op
-
posed to irresponsible government
spending, so long as the money doesn’t
go to Americans in need. This de cit
left America unprepared for the col
-
lapse in tax revenues that came with
the nancial crisis.
Having inherited this crisis, the
Obama Administration ought to have
made creating jobs its priority from
day one. Instead, it joined the battle
against the federal de cit even before
Inauguration Day. In 2010, Obama
appointed two de cit hawks, Erskine
Bowles and Alan Simpson, to come
up with a budget-balancing plan,
which they did—an extremely stulti
-
fying one, holding government
spending to its average level since
1970 despite an aging population and
rising health-care costs. Fortunately,
the president did not accept the
Bowles–Simpson commission’s rec
-
ommendations, but deficit cutting
rather than job creation remained
Obama’s priority until 2011, and it
seems now to have returned to the
top of his list.
Obama has always been afraid of
calling too much attention to gov
-
ernment. The stimulus program es
-
tablished early in his rst term may
have kept the nation from an out
-
right depression, but Obama didn’t
boast about its bene ts during his re
-
election campaign. And he certainly
didn’t come back to Con-
gress for more.
I
n his second inaugural speech,
Obama listed a parade of goals that
would make Americans proud of their
citizenship again. At such times, he
seems ready to ght for the social pro
-
grams and public investments the na
-
tion needs for a strong recovery. But
since then he’s continued to show
himself to be a member of the
austerity-economics brigade. His fu
-
ture budgets will be riddled with com
-
promises. He’s likely to reduce Social
Security benefits, and maybe even
raise the Medicare eligibility age to
sixty-seven. In a time of severe long-
term unemployment and entrenched
poverty, vital programs for the poor
like Medicaid may be cut back. All of
these cuts would be mistakes.
If Obama must use Reagan as a
guide it should be as a guide to what
not to do. It is time to bring the Age of Cruelty to an end.
