IS ANYONE LESS FIT TO ASSESS A PRESIDENCY THAN THE ACADEMIC LEFT?:

Not Ready for Mt. Rushmore: Reconciling the myth of Ronald Reagan with the reality (Matthew Dallek, Summer 2009, American Scholar)

Any assessment of the Reagan presidency should begin by examining the ideas that defined his economic agenda. Reagan pioneered supply-side economics and was the first president since the New Deal to put in place a thoroughgoing hands-off, deregulatory philosophy. In 1981, Reagan enacted the Economic Recovery Tax Act, which became the model for George W. Bush’s tax cuts two decades later. Reagan’s legislation drastically changed the nation’s economic priorities. It sharply cut marginal income taxes on the wealthy, slashed the capital-gains tax, lowered taxes on oil companies and other large businesses, and reduced spending on a host of unpopular social programs that had inspired Reagan’s critique of the bloated federal welfare state. Welfare, food stamps, school lunches, job training, student loans—Reagan’s first budget reduced spending in all these areas.

In contrast, his administration generously funded the nation’s military budget. Reagan devoted billions in spending to new military hardware and to researching weapons systems, including his Star Wars missile shield, a program that he endorsed in March of 1983. In his 2008 book, The Age of Reagan: A History, 1974–2008, Princeton historian Sean Wilentz explained how Reagan’s first budget marked a sharp turn in the nation’s economic direction: “wealth would be redistributed toward the wealthy, while the government would be starved of funds to meet non-military needs.” The exploding budget deficits that resulted were among Reagan’s most significant legacies. In 1980, the national debt stood at $994 billion; by 1989, it had nearly tripled to $2.8 trillion. Wilentz puts the blame squarely on Reagan’s program to reduce taxes while increasing the defense budget and failing to curb government’s growth beyond the social programs, which in any case weren’t a large part of the budget. While “the administration and its supporters were quick to blame a spendthrift Congress” for the deficits, Wilentz writes, “the administration itself (which never submitted a balanced budget) was chiefly responsible,” because incoming federal tax revenues in the 1980s “came nowhere near the levels required to cover the immense new outlays on the military.”

Moreover, the economic consequences of deficit spending for the country on a range of issues were hard to overstate. As Wilentz argues:

Deficits stripped the government of funds that might have been invested in the nation’s economic infrastructure. The requisite borrowing from abroad to cover the government’s obligations also turned the United States from a major international creditor into the world’s largest debtor in world markets. But if he wanted to reduce the deficits, Reagan would have been forced either to forgo the military buildup and the tax cuts that were the pillars of his presidency, or to ask the American people to make sacrifices in their material standard of living. Neither choice, for Reagan, was an option.

Reagan’s White House had said that lower marginal tax rates on the wealthy would create incentives for them to invest their money, thereby stimulating the economy and raising federal tax receipts. Cut taxes, they said, and tax revenues will go up. As we now know, that didn’t happen. Reagan’s refusal to make tough economic decisions inaugurated an era of reckless government spending, one that pioneered the notion that, as Dick Cheney put it during his vice presidency, “deficits don’t matter.”

But Reagan’s commitment to cutting taxes wasn’t nearly as unwavering as some of his conservative supporters have claimed. In 1982, he raised the gas tax and reversed some of his own tax cuts. In 1983, he achieved a bipartisan deal with Congress to raise Social Security payroll taxes, making the program more solvent. He reformed the tax code in 1986—cutting corporate tax rates and marginal tax rates on the wealthy while increasing the capital gains tax rate and abolishing some tax shelters—and showed flexibility that his ideological heir George W. Bush rarely showed on a host of fiscal issues.

Nonetheless, after Reagan’s 1981 budget was enacted, the die was cast. David A. Stockman, Reagan’s first budget director, who later denounced the Reagan revolution as a fraud perpetrated against the public, described the dynamic this way: “After November 1981, the administration locked the door on its own disastrous fiscal policy jail cell and threw away the key.” Stockman said that nobody inside the administration would give up anything. President Reagan wanted the tax cut; the defense secretary, Caspar Weinberger, was defending his $1.46 trillion budget; and White House Chief of Staff James A. Baker was making sure nobody in the administration proposed to cut Social Security, lest it hurt the president’s political standing. “The nation’s huge fiscal imbalance was never addressed or corrected,” Stockman wrote; “it just festered and grew.” Reagan’s rhetoric notwithstanding, the size of the federal government expanded. He made Veterans Affairs a cabinet-level agency, and the number of federal employees increased on his watch. So much for warnings about the dangers of big government.

The savings and loan crisis, the precursor of today’s financial meltdown, came about as a result of Reagan’s anti-regulatory approach. Reagan had made good on the business philosophy he had promised during the campaign: in order to give markets a freer hand, he relaxed federal regulations. Indeed, he led the charge to eliminate regulations on loans the S&Ls made, so that they operated in an unfettered environment with little oversight from the government. By 1988, this policy resulted in a debacle. Hundreds of S&Ls had made a series of high-risk investments. When the S&Ls began to fail, the administration was left with little choice but to use the power of the federal government to bail them out with taxpayer dollars. Up until Bush’s 2008 TARP program, the Reagan-led effort represented the largest government bailout in history, costing the American people an estimated $500 billion.

Even the admiring Diggins admitted that “the S&L debacle suggests the unintended consequences of Reaganomics” and that Reagan’s deregulation had backfired. “The idea of deregulation intended to remove government from the private sector of the free market. Yet the program was based on government-guaranteed banking deposits. Capitalism, hailed for its aversion to public policy and willingness to compete and take risks, actually wanted government to minimize all contingency while S&L directors gambled with other people’s money” by investing in junk bonds and other risky securities. The situation bore at least passing resemblance to the high-risk investment strategy of under-regulated banks buying up billions in bad mortgages that happened on Bush’s watch, although Democrats, including President Clinton, can share some of the blame.

Who Ended the Cold War?

Reagan’s defenders’ strongest claim for his legacy is that he won the Cold War. He alone, they say, had the foresight and wisdom to invest heavily in a military buildup; challenge the Soviets, using bold and tough rhetoric; and repeatedly invoke the cause of freedom as the United States battled implacably repressive regimes in the Soviet Union and Eastern Europe. Confronted with Reagan’s strengthened military and his verbal assaults, the Soviet Union imploded, and the Cold War ended in a triumphant U.S. victory. As Mann’s new book shows, the president’s approach during his second term was “generally at variance with his image as a truculent Cold Warrior.” Reagan, says Mann, was among the administration’s “doves” in the last years of his presidency.

Stephen Kotkin, a specialist in Soviet history at Princeton, punches even more holes in the mythology of Reagan’s single-handed triumph over the Soviet bear. He recently pointed out in a blog post that Reagan’s greatest contribution to ending the Cold War was that “he possessed the vital political credibility . . . to respond seriously to arms control overtures by Mikhail Gorbachev, thereby giving the Soviets the room to destroy their own system unintentionally.” By putting the end of the Cold War into its larger geopolitical context, Kotkin suggests that Reagan was an important, if not always crucial, factor in this much bigger story. Reagan wisely negotiated a series of arms-reduction agreements, which led to a thawing in the Cold War. Reagan succeeded by departing from the almost single-minded anticommunism that had defined him throughout his political life.

Kotkin also asserts that the explanation for the end of the Cold War is too often “Reagan-centric.” The idea that Reagan “won” the Cold War reduces the story to the myth of a lone cowboy riding to the rescue when the world was on the eve of nuclear annihilation. “Too many analysts credit President Reagan with having helped bring down the evil empire,” Kotkin writes, “by building up America’s military and bankrupting the Soviets (who were forced to respond in kind).” But Kotkin points out that the Soviets had increased military spending to “astronomical levels in the 1970s,” before Reagan took office, and that by the 1980s they had determined that his missile defense system “would never work.” Kotkin suggests that, to understand the collapse of communism, we must look “to the wider world.” The most damaging competition to the Soviet Union came, he says, not simply from Reagan’s rhetoric but also from the material and intellectual appeal of post–World War II U.S. and Western capitalism.

Was Ronald Reagan an Even Worse President Than George W. Bush? (Robert Parry, June 5, 2009, Consortium News)

Nixon, Ford and Carter won scant praise for addressing the systemic challenges of America's oil dependence, environmental degradation, the arms race, and nuclear proliferation – all issues that Reagan essentially ignored and that now threaten America's future.

Nixon helped create the Environmental Protection Agency; he imposed energy-conservation measures; he opened the diplomatic door to communist China. Nixon's administration also detected the growing weakness in the Soviet Union and advocated a policy of détente (a plan for bringing the Cold War to an end or at least curbing its most dangerous excesses).

After Nixon's resignation in the Watergate scandal, Ford continued many of Nixon's policies, particularly trying to wind down the Cold War with Moscow. However, confronting a rebellion from Reagan's Republican Right in 1976, Ford abandoned "détente."

Ford also let hard-line Cold Warriors (and a first wave of young intellectuals who became known as neoconservatives) pressure the CIA's analytical division, and he brought in a new generation of hard-liners, including Dick Cheney and Donald Rumsfeld.

After defeating Ford in 1976, Carter injected more respect for human rights into U.S. foreign policy, a move some scholars believe put an important nail in the coffin of the Soviet Union, leaving it hard-pressed to justify the repressive internal practices of the East Bloc. Carter also emphasized the need to contain the spread of nuclear weapons, especially in unstable countries like Pakistan.

Domestically, Carter pushed a comprehensive energy policy and warned Americans that their growing dependence on foreign oil represented a national security threat, what he famously called "the moral equivalent of war."

However, powerful vested interests – both domestic and foreign – managed to exploit the shortcomings of these three presidents to sabotage any sustained progress. By 1980, Reagan had become a pied piper luring the American people away from the tough choices that Nixon, Ford and Carter had defined.

With his superficially sunny disposition – and a ruthless political strategy of exploiting white-male resentments – Reagan convinced millions of Americans that the threats they faced were: African-American welfare queens, Central American leftists, a rapidly expanding Evil Empire based in Moscow, and the do-good federal government.

Assessments of presidents are almost always, and probably inevitably, personality-driven--that meaning both the personality of the president and of the assessor. It is much more useful to begin by looking at a range of years prior to and after the presidency to see what sorts of crises emerged and what steps needed to be taken to meet them and then to look at what that president did in this regard.

For the period following the Great Depression/WWII there were really only two issues that mattered, both flowing from the achievements and mistakes of the FDR/Truman years: (1) reforming the Social Welfare state so that it would be premised on capitalism rather than socialism; and (2) ending the war with Communism, preferably, but not necessarily, by ending the USSR. FDR's erection of some for of safety net to protect against the vagaries of capitalism's downturns was long overdue--as we can see by comparing America to every other developed nation--and the triumph over the Axis powers was an unalloyed good in itself. Unfortunately, the form of the Welfare system and the decision to leave the USSR in place meant that the presidents who followed had much left to do.

With the possible exception of Dwight D. Eisenhower's minimalist presidency, none of the successors can be said to have moved the ball in the right direction until Reagan, with all but Ike moving in the wrong direction. Reagan, however, came to office with a surpassing hatred of the Cold War and especially of the threat of mutual annihilation and with a healthy skepticism about the efficacy of the Welfare State. Since he, like Ike, grasped how inherently weak the USSR and its system were, he was able to win the Cold War simply by calling them out, by rolling them back at the margins and by challenging them technologically. Between his assertions that they were toast, his successful proxy wars in Central America, Africa, and the Middle East. and the gauntlet of Star Wars, he torqued up the pressure so high that the Iron Curtain blew apart at the seams. The Left is won to give Gorbachev credit for ending Communism, but fails to understand that Gorby wanted to reform it enough to make it competitive, not euthanize it. He lost. Reagan won.

As regards the Reform of the Welfare State, Ronald Reagan was ultimately too much a child of the Depression to undertake the radical alterations that were needed, even though he may have had the political leeway to do so. He was willing to demonize big government and largely did the rhetorical paving that cleared the path for Third Way reforms, but he, unlike a Margaret Thatcher, left behind the system he inherited.

On balance, you'd have to say that his performance was awfully good.

Posted by Orrin Judd at June 8, 2009 11:33 AM