So what? Revenue has nearly doubled under Obama. that tends to happen when a recession ends. And annual deficits are starting to decline, very slowly, but at least headed in the right direction.
Under Reagan, deficits grew because revenue didn't keep pace with spending. Reagan didn't decrease spending in any one of the eight years he was in office. And he never submitted a balanced budget. by the end of his first term,annual deficits were nearly three times as large as in his first year. (70 billion to 200 billion) And way above 1979 when the deficit was 40 billion.
What Volcker said below was that Reagan created a feeling-Reagan was very good at cheerleading-about how government isn't the solution to everything. But Volcker infers that Reagan actually cut back on spending, which he didn't. A historical fact. Look at the budget yourself.
Reagan said "government isn't the solution, it's the problem" But he did little else. He cut taxes, didn't get the revenue expected from those tax cuts and refused to cut spending. By the end of his first term, the annual deficits had tripod (or nearly so) the national debt.
But I gotta admit the guy was a master of the camera. Gorby said, in his talks with Reagan, that Reagan seemed confused and vague in private conversation but lite up when the camera light came on.
Another famous story from those talks, Colin Powell and others told of Reagan telling Gorby about how, if an alien force invaded earth, the US and theUSSR would join together to fight a common enemy. Kind of like WWII, only earthlings against aliens. Gorby was shocked by the talk. Powell would say, when Reagan got going, "here come the little green men."
Gotta love Powell's loyalty to his boss.
What a legacy. "Morning in America" without the sun rising. Carter said that Americans had to live within its means and got hammered for it, for stating an obvious fact. Reagan said it was morning in America and everybody crowed.
Carter was probably the most moral president we've had in my lifetime, a president who ended military aid to the murderous dictators in Guatemala, el Salvador and Nicaragua, aid that Reagan restored to the first two and waged war against the people who overthrow the murderous dictator in the third.
Carter made some bad appointments, Ham Jordan being the biggest, his one-year Fed chairman, who took over from an equally poor fed chairman appointed by Nixon. And let's not forget Bert Lance.
But at least Carter saw his flaw in the fed appointment and eventually appointed Volcker, who was responsible for what Reagan took credit for.
There was no such introspection in the Reagan administration. Remember "lose shoes, tight pussy and a warm place to shit."? Earl Butz, wasn't it? Those were the days.
Reagan had more members of his administration indicted than any previous administration, including Nixon, all of them pardoned by HW bush or Reagan himself. He waged war against a nation that committed no hostile acts against us, except overthrowing a US-installed murderous dictator, and sold arms to to a country that had seized our embassy, a country that was the subject of an international boycott of arms sales. Again, what a legacy.
Throughout it all the right clammed up and said nothing because Reagan spoke their language. Spoke of family values although he had none himself (was screwing around with Nancy Davis before his divorce from Jane Wyman, knock Nancy up before he was divorced, and so on) , spoke about fiscal responsibility although he instituted none on the government himself, and talked of peace although he armed some of the most murderous thugs in the world, including a little-know Islamic cleric fighting the Soviet-backed government in Afghanistan, a man known as Osama bin Laden. You know, you enemy's enemy and all that.
What a legacy.
DennisDee wrote:
I agree real estate did increase in value but for many of us this was a horror since we could not afford a mortgage at 16% and we watched in equal horror knowing prices were going up as we watched.
Speaking to the Volker issue. Yes Carter appointed him and deserves credit for reversing HIS mistake of appointing William Miller who was terrible. Carter had to promote him to a cabinet position just to get him out of the Fed.
While it is true that Presidents have little or no direct control over interest rates they do have indirect control. Interest rates were raised to slow inflation but it was not working so Volker kept raising them. Eventually we entered into a recession and experienced a spike in unemployment. The perfect storm of high interest, unemployment, recession and double digit inflation. I found an interesting interview with Volker. Yes on PBS so it should be acceptable to you.
PAUL VOLCKER: I think there was a Reagan revolution in terms of the cutting edge of this moving back from this feeling that [if] you've got a problem, the government would answer it. Here's a big brother here to help you, as Mr. Reagan used to mock, but if it's true that we needed some cutting back in this exuberant view of government, which I happened to share, he certainly did it with some vigor. He did it in a way that helped restore the confidence of America in America, which had been lost, or at least greatly eroded, during the 1970s.
INTERVIEWER: Was the air traffic controllers' strike a watershed?
PAUL VOLCKER: Yes, I think it was, and that's not often appreciated. One of the major factors in turning the tide on the inflationary situation was the controllers' strike, because here, for the first time, it wasn't really a fight about wages; it was a fight about working conditions. It was directly a wage problem, but the controllers were government employees, and the government didn't back down. And he stood there and said, "If you're going to go on strike, you're going to lose your job, and we'll make out without you." That had a profound effect on the aggressiveness of labor at that time, in the midst of this inflationary problem and other economic problems. I am told that the administration pretty much took off the shelf plans that had been developed in the Carter administration, but whether the Carter administration ever would of done it is the open question. That was something of a watershed.
http://www.pbs.org/wgbh/commandingheights/shared/minitextlo/int_paulvolcker.html#4I agree real estate did increase in value but for ... (
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