Tuesday, August 24, 2010

Ronald Reagan was a fiscal conservative ????

This post is about the funniest 3 word combination in the English language. 

But first, check out this movie trailer.  I WILL see this if it ever makes it to Texas:



There's only one problem. Why are they featuring Republican politicians?  Especially Ronald Reagan? 

Ronald Reagan was able to increase the amount of money coming into the Treasury by using a simple method.  He lowered taxes.  GDP increased as people hid less of their income and put it to work in sensible ways.  It's better to have 15% of a thousand dollars than 85% of a hundred dollars.
 
But under Reagan, our government spent money like, well, like Republicans. 

Here's a chart showing U.S. debt as a percentage of GDP.  It's from Wikipedia, but it roughly follows the info to be found here:

Look at the pink band running from 1981 to 1993, the Gipper/Poppy Bush era. 
Does that look like they believed "Government Is Not The Solution; Government Is The Problem?"

Here's another look at the same data, formatted for entertainment value....

Enough about Reagan.  Here's the Cato Institute's Veronique De Rugy on George W. Bush's spending habits:

During his eight years in office, President Bush oversaw a large increase in government spending. In fact, President Bush increased government spending more than any of the six presidents preceding him, including LBJ. In his last term in office, President Bush increased discretionary outlays by an estimated 48.6 percent.


During his eight years in office, President Bush spent almost twice as much as his predecessor, President Clinton. Adjusted for inflation, in eight years, President Clinton increased the federal budget by 11 percent. In eight years, President Bush increased it by a whopping 104 percent.

One reason offered for these large budget increases is that entitlement programs are growing rapidly. Although Social Security and Medicare spending growth outpaced most other programs in the mid-1990s, spending growth in discretionary programs has accelerated in the last 15 years, especially during Bush’s two terms. Between FY2002 and FY2009, discretionary spending rose 96 percent.

Some argue that federal spending during the Bush years was so high because security needs drove up the budget. It is true that defense spending increased dramatically since the late-1990s, particularly since 9/11 and the beginning of the wars in Iraq and Afghanistan. However, nondefense spending increased too. Some also argue that much of the increase in nondefense spending stemmed from increases in homeland security spending. Whether this is true, the overall rapid rise of discretionary spending indicates that, here too, the administration and Congress made no trade-offs in the budget. If the administration and Congress wanted more security spending and wanted to be fiscally responsible, they should have found savings elsewhere in the budget.

President Bush added thousands of new federal subsidy programs during his eight years in office. In 2008, there were 1,816 subsidy programs in the federal budget that spread hundreds of billions of dollars annually to special interest groups such as state governments, businesses, nonprofit groups, and individuals. The number of subsidy programs has grown by 30 percent since 2000 and by 54 percent since 1990.

Here's some more research from Ms. De Rugy, from the November 8th, 2008 issue of Reason magazine.  (Remember, this was written before the current Messiah started his spending spree):
 
"When it comes to out-of-control spending, conventional wisdom says the Democrats are most likely to bust open the coffers. That's why many fear an increased Democratic majority in Congress topped by a Democratic president. And we should be afraid. Democrats are indeed big spenders. Second only to Republicans."
 
She goes on to rank the possible combinations of Republican vs. Democrat control of Congress and the Presidency, going from kinda bad to worse:
 
1) Democratic White House, Republican Congress

2) Republican White House, Democratic Congress
3) Unified Republican or Democratic rule.

You cannot, you will not, get spending under control by electing Republicans.  Until recently, Republicans held all the spending records.  Democrat spending might be sillier, and easier to poke fun at, but by every measurement, until recently, the Democrats spend less money.  If you look at the long term, FREAKIN' DEMOCRATS are the fiscal conservatives ! 

We simply have to start electing Libertarians to high office.  There is no other solution. 

Oh, and the funniest 3 words in the English language? 
Small Government Republican

3 comments:

Nick Rowe said...

The problem during the Reagan years is that Reagan had to bargain with a hostile Congress to get the military spending he wanted and which ultimately kicked the USSR over the cliff. The USSR was spending close to 50% of it's GDP on the military to keep up with us.

Growth in entitlement programs were the biggest cause of deficits during the 80s and beyond.

Bush had to rebuild the military after eight consecutive years of budget cuts. He spent a lot of money on necessary security, but he also added prescription drug benefits for medicare and his "ownership society."

I agree that philosophical principles always seem to vanish when power is achieved. That's why We the People need to force government to chain the steering wheel to a balanced budget. I think Reagan was sincere about the BBA and the line-item veto.

Anonymous said...

Wow.

Now, in defence of Regan, he was justified, IMHO, to ratchet up the spending in order to win the cold war. When he came to power finding the decrepit USSR at a tipping point, it would have been irresponsible not to have taken that opportunity.

That war won, Bush 1 was justified in spending what he had to, in order to slap down Saddam.

But is'nt it an eye-opener to see Clinton reduce the defecit so?

You never know, maybe Obama can surprise us in the next two years and work to reduce the defecit.

Whiskey Jim said...

cool graphs.

President matters a little.

But it is Congress that signs the bills.

The more accurate graphs would be showing not the Presidents, but the Congresses.