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Monday, August 20, 2012

Is It Time To Return To Reaganomics?

(Hat tip to Western Hero for the above graphic)

Those on the Left become apoplectic whenever anyone lauds Reaganomics. Wikipedia is as good a place as any to start if one doesn't recognize what Reaganomics entailed. The Library of Economics and Liberty also has information, information that is condensed and more reader-friendly.

In any case, consider the Daily Caller video below the fold (with thanks to Mustang for emailing me the link).


A brief comparison of Obamanomics and Reaganomics from the Wall Street Journal, dated August 26, 2011, states in part:
If you really want to light the fuse of a liberal Democrat, compare Barack Obama's economic performance after 30 months in office with that of Ronald Reagan. It's not at all flattering for Mr. Obama.

The two presidents have a lot in common. Both inherited an American economy in collapse. And both applied daring, expensive remedies. Mr. Reagan passed the biggest tax cut ever, combined with an agenda of deregulation, monetary restraint and spending controls. Mr. Obama, of course, has given us a $1 trillion spending stimulus.

By the end of the summer of Reagan's third year in office, the economy was soaring. The GDP growth rate was 5% and racing toward 7%, even 8% growth. In 1983 and '84 output was growing so fast the biggest worry was that the economy would "overheat." In the summer of 2011 we have an economy limping along at barely 1% growth and by some indications headed toward a "double-dip" recession. By the end of Reagan's first term, it was Morning in America. Today there is gloomy talk of America in its twilight.

My purpose here is not more Reagan idolatry, but to point out an incontrovertible truth: One program for recovery worked, and the other hasn't.

The Reagan philosophy was to incentivize production—i.e., the "supply side" of the economy—by lowering restraints on business expansion and investment. This was done by slashing marginal income tax rates, eliminating regulatory high hurdles, and reining in inflation with a tighter monetary policy....
Please read it all – never mind that economics is sometimes justly referred to as "the dismal science."

Since at least 1980, when the American electorate has perceived the economy as an overriding election issue, the incumbent or the seated President's party has lost the election.  Is it any wonder, then, that Obama is trying to paint as rosy a picture as possible when it comes to our ailing economy and that he is also concentrating on as many digressions, diversions, and deflections as possible? 

27 comments:

  1. Libs do go ape when you mention Reagan. Fun to watch, ain't it?

    The comparison is a stark black and white. The libs will start bleating about taxes, and I say upfront that another such tax rate reduction won't work because their isn't as much to slash now, and the marginal gain would be small.

    The key part of Reaganomics that applies today is economic liberty: Recognize that the government is not an economic growth engine. The American people are the engine. Get out of the way and let them produce. Get the bureaucratic fat-asses off of us, burn down the libraries of job-killing federal regulations, and just regulate a fair and free market.

    Thanks for the hat tip!

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  2. I see that Conservatives On Fire has a related post today: "This Regulation Nation Will Explode Under An Obama Second Term." If commenters here have time, please read the post.

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  3. We don't so much need to reduce individual taxes as we do to reduce corporate taxes as well as to roll back a tonne of regulations. These would still be an incentive to the supply side. Romney is talking about reducing corporate taxes to 25% and doing away with a lot odeductions. I agree that the taxe code needs reform; but by only reducing to 25% as opposed to 20% or 15%, Romney needs to be careful that the loss of deductions doesn't make our businesses less competetive than they were before.

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  4. B.O.'s incessant rant aginst "Reaganomics" is reason enough to support it. Reaganomics worked. B.O. has put us on the path to HELL!

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  5. Less of everything government would clean this mess up. Shall we start with ending the EPA as we know it.

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  6. St. Ronnie Raygun stimulated growth through government spending.

    He took out that credit card and really got the government into debt while we all got the credit cards too.

    We've been through several decades off growth funded by debt and I want to ask AOW when we EVER LEFT REAGANOMICS?
    Why do you wish to continue something that got us into this mess?

    It really is time to ditch the worship of that stiff.

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  7. "ending the EPA as we know it."

    Yes, it's time (past time) for a re-examination of many such Depatrments, programs, etc which, while well intended, have gone into 'overkill' mode thus operating counter to the overall good of the Country. No, I don't advocate for dirty air and water! I do, however, advocate for common sense. Keystone comes to mind.

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  8. JonBerg, can you explain supply side economics?
    I don't think the fringe right understands it.

    I'd say it is a reversal of demand economics which puts an emphasis on production funded by cheap labor and cheap energy. Of course getting the cheap labor means illegals and overseas jobs and the energy still requires we use the military and the State Dept. to handle extortion and occupation in the M.E. and Africa but nothing's perfect.

    Then everyone fires up those credit cards and we go into a bubble economy that bursts and becomes more severe every time we repeat the cycle.

    What's your version?

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  9. Reducing tax rates releases money to invest in the private sector which grows the overall economy and thus the tax base. With reference to the "credit cards" what about the amazing debt increases under the the present Administration with no appreciable improvment in the overall economy? Generational theft is an abomination! Nuff said!

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  10. Supply-side economics holds that economic growth can be most effectively created by lowering barriers for people to produce goods and services (supply), such as lowering income tax and capital gains tax rates, and by allowing greater flexibility by reducing regulation.

    Those who stand in opposition are leftist elitists whose principal argument is that anyone who advocates supply side economics lacks credentials. This is typical of the Alinsky mindset and, if I need to say it, bull crap.

    However, I do agree that there is a legitimate criticism of Reagonomics: he failed to curb spending commensurate with his determination to cut taxes. I understand why he did it, though.

    To suggest we need “more taxes” is a ridiculous argument; the opposite is true. We also need far less federal spending. We must limit federal spending to specific constitutional authority. Do we need a federal Department of Education? No. We do not need crony capitalism, wasting hundreds of millions on Solyndra schemes or investing in automotive plants in Finland.

    We need more Friedman thinking, and far less naive Keynesian policies. And we need far fewer Democrats.

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  11. I think with Paul Ryan we may be going back. But I would probably describe it as "going forward", the best of Reagan, only improved, 2.0

    Debbie
    Right Truth
    http://www.righttruth.typepad.com

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  12. The short answer to your question is YES!

    The BIG question hanging in the air, however, is WHY DID WE EVER LEAVE REAGANOMICS?

    Must have been insane.

    Oh wait! That was George H. W. BUSH who did that.

    The Bushes were both rotten presidents.

    They too are part of The OLIGARCHS.

    ~ FT

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  13. Reagan was a good strong and well respected President.

    My question is can you really attempt to compare the situation that Reagan arrived in say in comparison with Obama?

    The graph shown - does that represent the total of the two terms of Reagan or just the first term, as if it is the latter then it is no good as you are comparing the total of eight years with only four years - does not match.

    Do we believe that there was a similar standard economic crisis built prior to Reagan with the one that Obama inherited?

    When we understand the history and context can we then try and make comparisons. Personally I doubt it and though I think Reagan was still the best President in the modern era, I believe this actual attempt is not accurate and can only assume it is just more anti-Obama election hype.

    Damien Charles

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  14. Sam,

    Have you considered, perhaps, that DC is , in reality, nothing more than a complete "nut" who resides in an institution some place, high above the entrance to the Mediterranen Sea? The more I read , the more I wonder. I think most patients are allowed internet access. Seriously, this guy is a "couple of bricks short of a load"; think about it!

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  15. NOTICE TO COMMENTERS:

    I am finally getting to my own web site to check comments after being off the grid since mid-morning yesterday.

    1. Sick cat here. Very aged and going downhill fast. I've got the vet coming today.

    2. Lesson plans for school. Developing a new course --Western Civilization through Filmography -- is time consuming.

    3. Dental appointment. I didn't feel much like blogging afterwards. I hate getting any dental work done!

    4. Paperwork to fill out for a student. What a marathon of questions to answer! Some 250 of them!

    I hope to be back online full speed ahead late today.

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  16. I have to say the following about Ronald Reagan as I remember that time quite well....

    Until Jimmy Peanut was well into his second term, NOBODY ever thought that Reagan could win a Presidential election.

    In fact, most people "in the know" felt that Reagan had missed his chances to run. Yes, his age was part of the reason. My father, born the same year as Reagan almost didn't vote for Reagan on the basis of age as Dad realize how much that he himself had slowed down.

    But several factors combined under Jimmy Peanut's governance to make Reagan the attractive GOP candidate -- plus, some behind-the-scenes planning in 1979 by the Karl Rove of that era.

    My best friend at the time -- a life-long NYC Democrat as was her entire family -- said, "I can't believe pulled the lever for a Republican!" (her words). I'm not sure that she ever voted for a Republican after 1984, BTW. Never talked with her very much about politics.

    We may see something similar to what my friend did back in 1980 on Election Day 2012.

    I sat up late on Election Night 1980. The astonishment on that part of all upon Reagan's decisive victory! I still recall the shock waves.

    Fact: When the economy weighs heavily on voters' minds, they vote out the incumbent and the incumbent's Party. I know that this fact absolutely holds since 1980 and, to some extent, earlier in the 20th Century as well.

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  17. What Reagan did for me:

    1. Federal regulations changed so that I could fund my own IRA and get a tax deduction from gross income for dumping $2000/year into an IRA. It is my recollection that, prior to Reagan, such was not allowed.

    2. Lowering the estate tax, that is, giving a dollar-amount exemption before taxes kicked in AND allowed a dying spouse to pass everything tax free to the surviving spouse.

    My father-in-law died at the age of 61 and passed his entire estate to his widow. Ye, gods! The tax hit that the woman took! She is still alive today at age 92 -- if you call it "alive"; she is in the final hideous stage of Alzheimer's, the stage of complete helplessness. She is, at this very moment, on her way to starvation because she is forgetting how to swallow. There will be no feeding tube -- the family has already made that decision. And lest anyone reading this comment think that extraordinary measures are being used, think again: no meds, no IV's, etc. She is lying in a bed -- in her own feces and curled up from contractions due to loss of brain tissue. The only thing to kill her IS Alzheimer's!

    If only my mother-in-law had that money that the death taxes had stolen for her, she wouldn't be on the taxpayers' dole in a facility that warehouses her!

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  18. October "surprise"?

    Iran unveils new missile, other weapons

    Could be a game changer.

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  19. New Chart Shows Reagan and Bushes Increased Deficit Seven Times as Much as Clinton and Obama

    A new chart based on Treasury Department data shows that the deficit increased by 189% under Ronald Reagan, 55% under George HW Bush, only 37% under Bill Clinton, 115% under George W. Bush, and only 16% so far under President Obama.

    http://workersrights.twu.org/post/10989448472/new-chart-shows-reagan-and-bushes-increased-deficit

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  20. Liberalmann,
    About that link you left...Hardly an objective source.

    And you accuse this web site of bias? Sheesh.

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  21. JoBerg,

    how about it of participation instead of just being here to attempt to bait me. I am flattered that you think I so important in your life but in reality it only makes you look the complete git that you obviously are. I suggest the best way of trying to have a go at me is by actually throwing something back at me on subject and not the usual baseless rhetoric.

    Or am I kidding myself that you have that capacity....... perhaps not.

    If you have not noticed, I actually posted three legitimate questions and I am still waiting to see if anyone can actually answer them.

    Damien Charles

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  22. DC

    I glean from your, less than syntactical, response that you don't like me anymore; I'm crushed!

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  23. Jon,
    Damien Charles doesn't like anybody but himself. I'm growing weary of his diatribes and egotism.

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  24. Liberal lied:

    "New Chart Shows Reagan and Bushes Increased Deficit Seven Times as Much as Clinton and Obama"

    I went and check the numbers. The truth is far different:

    1) In 3 years, Obama has racked up as much debt as Bush did in 8 years. Based on this trend, if we re-elect Obama, he will amass three times as much debt as Bush.

    2) Reagan increased the debt by 2 trillion in EIGHT years. This is LESS than the amount Obama accumulates in TWO years.

    If you look at the actual figures, instead of deceiving by cooking the numbers as you do, Liberalmann, things look a lot different. The truth hurts your cause.

    Always On Watch: For these numbers, I go to Obama, actually. I got them from one of his own departments. Even the liberals' most powerful figure contradicts Liberalmann.

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  25. Dmarks,
    If you look at the actual figures, instead of deceiving by cooking the numbers

    Exactly.

    The problem is this: too many Americans hear something often enough, then believe it.

    For that reason, Obamamaniacs are running all over the web and elsewhere and spewing the kinds of lies that Liberalmann is spewing.

    I truly do not see that Obama can win in November. However, I never underestimate the gullibility of the American electorate.

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  26. AOW,

    if you look through this thread you will see that I asked a legitimate question and your friend Jon did the snark remark. May I recommend a bit of consistancy.

    Since I most certainly confess to going on a bit to much I will not repeat my simple honest question here - which of course was ignored and I still think more relevant than any other comment.

    Speaking of fairness, dmarks calls Lib a liar and you join in. I call, on another thread, Tammy a Liar, provide the clear evidence and get criticised..... but that is another story but an obvious pattern.

    Damien Charles

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  27. Damien,
    The obvious pattern is that people say what they think -- as do I.

    I do not chide adults -- with the exception of Liberalmann, who called me a vile name a few weeks back because I provided a link that proved him wrong. He hasn't apologized, and I haven't forgiven him. He's lucky that I haven't deleted every one of his comments the minute I see those comments.

    I will say a word about friendship as long as you have brought it up.

    Jon is not my "friend." He frequents this web site, yes, but he's quite new here.

    Tammy is a different story. She IS a personal friend of mine on more than one level. Maybe you are unaware of her credentials, which a very briefly listed here (incomplete list, BTW). You will note that she has a regular column in the Daily Times Pakistan. That last fact might give you a clue as to what she's all about, but only a clue. What it doesn't indicate: the kind of research she does. I'm not using the term "research" lightly.

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