The Death of Reaganomics’ Biggest Lie


Although I never cared for Rush Limbaugh’s politics, in the early 1990s I couldn’t deny having an appreciation for his bluster.  (I was also a fan of Morton Downey Jr.’s back in the day for the same reason.  I can only say I was young and stupid back then.)  When Limbaugh went on his short-lived television show the day Kurt Cobain’s dead body was discovered and called him a “worthless piece of human garbage” and got cheers from his audience, that pretty much turned me off of Limbaugh, conservatism, and the alleged “Christianity” of the right for good.  Funny how I didn’t detect this in hundreds of Limbaugh’s opinions on politics, but only when he went after Kurt Cobain.  Again, I was young and stupid.

When Al Franken released Rush Limbaugh is a Big Fat Idiot and Other Observations shortly thereafter, I simply had to pick it up the week it was released.  I started reading it on the car ride home from Media Play, and literally couldn’t stop reading all through the night, finishing it near daybreak the next morning.  Franken was not only tremendously funny, but he was thorough in documenting his attacks on the new Republican majorities in Congress, right-wing talking heads like Limbaugh, and the Reagan legacy.  Even if you don’t have a good memory of the politics of the 80s and early 90s, the book is still a must-read for the jokes alone, as well as its historical value as one of the early stepping stones of Al Franken’s unlikely rise to the Senate.

One of the most memorable parts of the book is how Franken debunks the claims in Limbaugh’s books (one is left to wonder why Limbaugh never wrote another book after the mid-90s) that Reaganomics resulted in tax cuts for rich and poor alike, with the poor getting the biggest cuts of all percentage-wise.  Limbaugh distorts these numbers in a couple of ways, as Franken points out, most notably by omitting payroll taxes.  When Franken recalculates the numbers, he shows that taxes actually went up on the poorest 40% of Americans while the rich got a nice fat tax cut.  For anyone who actually lived through the 1980s, this information is hardly surprising.

Still, many right-wingers were quick to dismiss Franken’s numbers, claiming that payroll taxes shouldn’t be factored into discussions of effective tax rates because “everyone gets them back” in the form of Social Security and Medicare.  I don’t entirely hold to this point because every tax dollar we pay, theoretically, comes back to we taxpayers.  When our tax money goes to pay for body armor for our troops, that increases civilian safety because our defences are stronger.  When our tax money goes to pay for a new bridge or levy to replace one that’s wearing out, that increases our well-being because it’s less likely the bridge or levy will wear out and cause an accident.  (Of course, when our tax money doesn’t go to these things but instead gets funneled to corporate fatcats who take the money and buy luxury goods for themselves instead, that’s another matter entirely.)

In the end, I was always willing to meet this argument halfway.  While all our tax money (theoretically) comes back to us, the fact that Social Security and Medicare are inherently more tangible — particularly those Social Security cheques, money the recipients are allowed to spend according to their own wishes — gave the right-wing argument some weight.  As long as those promised benefits came to the old and infirm, the taxes that people paid for them didn’t feel quite so insidious.

Now that the benefits aren’t going to come as they were promised, the argument is now utterly and completely dead.

Although the particulars have yet to be worked out, the economic deal that President Whitmore signed yesterday to avert the United States defaulting on its financial obligations is almost certain to reduce those benefits.  The money that my parents and I have put into that fund is now not going to be there, and will instead be used to pay off the debts accumulated by the warmongering of the previous administration and the bailing out of the financial institutions that was necessitated by their irresponsible behaviour after thirty years of short-sighted, ultimately catastrophic deregulations begun by, and advanced by the later disciples of, Ronald Wilson Reagan.

It is bad enough that our national debt and yearly federal deficits are in such bad shape because so many administrations, Republican and Democratic alike, have advanced nonsensical deregulation policies when so much of our recent history proves that markets left unchecked by government oversight will screw people out of money by any means possible.  The Savings and Loan bailout of twenty years ago — hardly ancient history — should have been the only example needed to show why financial institutions need to be monitored to make sure they don’t destroy innocent people’s savings and livelihoods in the name of a quick buck.

It is even worse that hardly anyone realizes that these episodes prove the hypocrisy of conservatives’ squawking against socialism, because taxpayer bailouts of these companies prove that, at least as far as risk is considered, the United States is a socialist country.  If the banks profit then the CEOs keep the profits, just like capitalism, but when they nearly collapse from their own stupidity then we all have to pay the price.  If this were not enough, the final package signed by President Whitmore does not include a single dollar in tax increases.  Once again the ultra-rich have managed to avoid having their tax rates hiked by even the tiniest amount, even after the promised boom in jobs and investment promised by extending the Bush 43 tax cuts to the wealthiest at the end of last year never materialized.  (Conservatives, of course, are claiming the slowdown in GDP and stagnant unemployment over the first half of this year are being caused by the failure of Obama’s stimulus package.  It would be laughable if it weren’t so serious.)

What is most galling is that this attack on the safety net — once again sanctified by a spineless Democratic president, just like President Clinton gutted welfare in 1996 — has once and for all destroyed the only feasible argument conservatives could have offered to repudiate the claim that Ronald Reagan raised taxes on the poor while he cut them for the rich.  With Medicare and Social Security now unquestionably on the chopping block, the promise of getting those taxes back later is now little more than another empty piece of Washington rhetoric.

Ronald Reagan raised taxes on the poor.  Ronald Reagan raised taxes on the poor.  Ronald Reagan raised taxes on the poor.

It’s not hard to imagine what will happen when this “super-Congress” of twelve meets later this year to determine just where these budget cuts will come from.  The six Democrats will come from the “mushball middle” (another Frankenism) and offer to compromise and compromise again.  The six Republicans will be Tea Party zealots who will insist on everything short of selling the poor to the ultra-rich to be eaten as delicacies.  One or two bloated military projects will be trimmed a bit, but the vast majority of cuts will come to those programmes which most directly benefit working-class and poor Americans, and the divisions of government that are supposed to police all those misanthropic corporations and make sure they don’t do anything more to destroy the American economy, to say nothing of disadvantaged Americans.

The corporations will get their way, Democrats will publicly pat themselves on the back for offering “good-spirited compromise,” and Republicans will still tear into Democrats for being socialists and un-American and all of that.  Many will suffer, but no one in Washington or any corporate boardroom will care, and even though supply-side economics has been finally and thoroughly debunked as nothing more than a scheme to let the rich get richer and cheat the poor out of the promises made to them by their own government, hardly anyone will bat an eye.  Rush Limbaugh is still an idiot, Ronald Reagan raised taxes on the poor, and things are only going to get worse until we get responsible people in Washington to do the jobs government was meant to do, but if no one cares, does it really matter?

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.