Tag: tax cuts

From RSN, by Robert Parry

“Exclusive: Ronald Reagan’s anti-government philosophy inspires Tea Party extremists to oppose any revenue increase, even from closing loopholes on corporate jets. Democrats try the spin that “even Reagan” showed flexibility on debt and taxes. But Robert Parry says it is the “Reagan cult” that is at the heart of America’s crisis.

In the debt-ceiling debate, both Republicans and Democrats wanted Ronald Reagan on their side. Republicans embraced the 40^th president’s disdain for government and fondness for tax cuts, while Democrats noted that “even Reagan” raised the debt limit many times and accepted some tax increases.

But Reagan – possibly more than any political leader – deserves the blame for the economic/political mess that the United States now finds itself in. He was the patriarch for virtually every major miscalculation that the country has made over the past three decades.

It was Reagan who slashed taxes on the rich to roughly their current level; he opened the flood gates on deficit spending; he accelerated the decline of the middle class by busting unions and slashing support for local communities; he disparaged the value of government regulations; he squandered money on the Pentagon; he pushed more militaristic strategies abroad; and he rejected any thoughtful criticism of past U.S. foreign policies.

Reagan also created what amounted to a “populist” right-wing cult that targeted the federal government as the source of nearly all evil. In his First Inaugural Address, he famously declared that “government is not the solution to our problem; government is the problem.”

It is that contempt for government that today is driving the Tea Party extremists in the Republican Party. Yet, as with many cults, the founder of this one was somewhat more practical in dealing with the world around him, thus explaining some of Reagan’s compromises on the debt ceiling and taxes.

But once the founder is gone, his teachings can become definitive truth to the disciples. Flexibility disappears. No deviation is permitted. No compromise is tolerated.

So, at a time when government intervention is desperately needed to address a host of national problems, members of this Reagan cult apply the teachings of the leader in the most extreme ways. Since “government is the problem,” the only answer is to remove government from the equation and let the corporations, the rich and the magical “market” dictate national solutions.

It is an ironic testament to Ronald Reagan’s enduring influence that America’s most notable “populist” movement, the Tea Party, insists that tax cuts for the wealthy must be protected, even minor ones like tax loopholes for corporate jets. Inside the Tea Party, any suggestion that billionaire hedge-fund managers should pay a tax rate equal to that of their secretaries is anathema.

Possibly never in history has a “populist” movement been as protective of the interests of the rich as the Tea Party is. But that is because it is really a political cult dedicated to the most extreme rendering of Ronald Reagan’s anti-government philosophy.

Astro-Turf ‘Populists’

Granted, the Tea Party also can be viewed as an astro-turf outfit financed by billionaires like the Koch brothers and promoted by billionaire media mogul Rupert Murdoch. But Election 2010 proved that the movement is capable of putting like-minded politicians into office, especially when discouraged elements of the American Left choose to sit on the sidelines.

During the debt-ceiling battle, the GOP’s Tea Party caucus showed it was strong enough to block any compromise that included a revenue increase. The thinking is that the “evil” government must be starved even if that means defending indefensible tax loopholes and shoving the world’s economy to the brink of catastrophe.

The Tea Party’s rabid enforcement of the Reagan orthodoxy instills such fear among top Republicans that every one of the eight presidential hopefuls at a recent Iowa debate vowed to reject a deal that would include just $1 of higher taxes for each $10 in spending cuts. Even supposed moderates like Mitt Romney and Jon Huntsman threw up their hands.

But the Reagan cult reaches far beyond the Republican Party. Last February, a Gallup poll of Americans cited Reagan as the greatest president ever, with a five percentage point lead over Abraham Lincoln.

These days, virtually no one in Washington’s political or media circles dares to engage in a serious critique of Reagan’s very checkered record as president. It’s much easier to align yourself with some position that Reagan took during his long career, much like a pastor selectively picking a Bible passage to support his theological argument.

When negative national trends are cited – such as the decline of the middle class or the widening gap between rich and poor – the self-censorship demands that Reagan’s name not be spoken. Instead, there are references to these problems deepening “over the past three decades,” without mentioning whose presidency got things going big time.

Creating an Icon

And there is a self-interested reason for this hesitancy. The Republicans and the Right have made it a high priority to transform Reagan into an icon and to punish any independent-minded political figure or journalist who resists the group think.

The first step in this process occurred in the late 1980s, with aggressive cover-ups of Reagan’s crimes of state, such as scandals over the Iran-Contra arms-for-hostages affair, Contra-cocaine trafficking, and the Iraq-gate support of dictator Saddam Hussein.

Faced with furious Republican defenses of Reagan and his inner circle, most Democrats and mainstream journalists chose career discretion over valor. By the time Bill Clinton was elected in 1992, the refrain from Democrats and Washington pundits was to “leave that for the historians.”

Those who didn’t go along with the cover-ups – like Iran-Contra special prosecutor Lawrence Walsh – were subjected to ridicule from both the right-wing and mainstream media, from both the Washington Times and the Washington Post. Journalists who challenged the implausible Reagan cover-ups also found themselves marginalized as “conspiracy theorists.”

Leading Democrats decided it made more sense to look to the future, not dwell on the past. Plus, acquiescing to the cover-ups was a way to show their bipartisanship.

However, Republicans had other ideas. Having pocketed the concessions regarding any serious investigations of Reagan and his cohorts, the Republicans soon went on the offensive by investigating the heck out of President Clinton and his administration.

Then, having stirred up serious public doubts about Clinton’s integrity, the Republicans trounced the Democrats in the 1994 congressional elections. With their new majorities, the Republicans immediately began the process of enshrining Reagan as a national icon.

By and large, the Democrats saw these gestures, like attaching Reagan’s name to National Airport, as another way to demonstrate their bipartisanship.

But Republicans knew better. They understood the strategic value of elevating Reagan’s legacy to the status of an icon. If everyone agreed that Reagan was so great, then it followed that the hated “guv-mint” must be that bad.

More Accommodations

Increasingly, Democrats found themselves arguing on Republican ground, having to apologize for any suggestion that the government could do anything good for the country. Meanwhile, the Clinton-era stock market boom convinced more Americans that the “market” must know best.

Going with that flow, President Clinton signed a Republican-sponsored bill that removed Depression-era regulations in the Glass-Steagall Act, which had separated commercial and investment banks. With the repeal, the doors were thrown open for Wall Street gambling.

In the short run, lots of money was made, encouraging more Americans to believe that the government and its “safety net” were indeed anachronisms for losers. People with any gumption could simply day-trade their way to riches.

Reagan, it seemed, was right all along: government was the problem; the “free market” was not only the solution but it could “self-regulate.”

That was the political/media environment around Election 2000 when the wonkish Vice President Al Gore ran against the brash Texas Gov. George W. Bush, who came across to many as another version of Ronald Reagan, someone who spoke simply and disdained big government.

Though Gore could point to the economic successes of the Clinton years, including a balanced federal budget and the prospect of the total elimination of the federal debt, the major media mocked him as a know-it-all nerd who wore “earth-toned sweaters.” Meanwhile, mainstream journalists swooned over Bush, the regular guy.

Still, Gore eked out a narrow victory in the national popular vote and would have carried the key state of Florida if all legally cast votes were counted. But Bush relied on his brother’s administration in Florida and his father’s friends on the U.S. Supreme Court to make sure that didn’t happen. Bush was declared the winner in Florida and thus the new president. [For details, see Neck Deep.]

In retrospect, Election 2000 was a disastrous turning point for the United States, putting into the highest office in the land an unqualified ne’er do well who had lost the election.

But this outrage against democracy was largely accepted because of the muscular right-wing machine, the on-bended-knee mainstream media and the weak-kneed Democrats – a political/media dynamic that Reagan had helped create and had left behind.

The progress that the Clinton administration had made toward putting the U.S. financial house in order was quickly undone as Bush pushed through two massive tax cuts benefiting mostly the rich and waged two open-ended wars financed with borrowed money.

Years of Reaganism also had taken its toll on the government’s regulatory structures. Reagan had consistently appointed regulators who were hostile to the very concept of regulating, such as Anne Gorsuch at the Environmental Protection Agency and James Watt at Interior. He also elevated Alan Greenspan, a “free market” admirer of Ayn Rand, to be chairman of the Federal Reserve Board.

In the 1980s, the looting of America was underway in earnest, but the elites of Washington and New York saw little to protest since they were getting a cut of the plunder. The real losers were the average Americans, especially factory workers who saw their unions broken or their jobs shipped overseas under the banner of “free trade.”

Feeling Good

But many Americans were kept entranced by Reagan’s feel-good magic.

Taking office after a difficult decade of the 1970s, when America’s defeat in Vietnam and the Arab oil price hikes had shaken the nation’s confidence, Reagan simply assured everyone that things would work out just fine and that no excessive sacrifice was in order. Nor should there be any feelings of guilt, Reagan made clear.

By the late 1970s, it was widely accepted even among many Republicans that the Vietnam War had been an abomination. But Reagan simply rebranded it a “noble cause,” no reason for any serious self-reflection on America’s imperial role in the world.

Reagan then allied the United States with “death-squad” regimes all over Latin America and across the Third World. His administration treated the resulting carnage as a public-relations problem that could be managed by challenging the patriotism of critics.

At the 1984 Republican National Convention, Reagan’s United Nations Ambassador Jeane Kirkpatrick labeled Americans who dared criticize U.S. foreign policy as those who would “blame America first.”

To continue this sort of verbal pummeling on those who continued to get in the way, Reagan credentialed a bunch of thuggish intellectuals known as the neoconservatives.

For the rest of the country, there were happy thoughts about “the shining city on a hill” and “morning in America.”

In reality, however, Reagan had set the stage for the tragedies that would follow. When George W. Bush grabbed power in 2001, he simply extended the foreign and economic policies of the Republican cult leader: more tax cuts, more militarism, less regulation, more media manipulation.

Soon, the gap between rich and poor was widening again. Soon, the United States was at open war in two countries and involved in secret wars in many others. Soon, the nation was confronted with new scandals about torture and deception. Soon, the federal budget was flowing with red ink.

And near the end of Bush’s presidency, the de-regulated excesses of Wall Street pushed the country to the brink of a financial cataclysm. Bush supported a bail-out to save the bankers but didn’t do much for the millions of Americans who lost their jobs or their homes.

Second Thoughts?

One might have thought that the financial crack-up in 2008 (plus the massive federal deficits and the botched wars in Iraq and Afghanistan) would have confronted the Reagan cult with an existential crisis of faith. It would seem obvious that Reagan’s nostrums just didn’t work.

However, after only a brief interregnum of Barack Obama, the Republicans seem poised to restore the Reagan cult to full power in the United States. The new apparent GOP frontrunner, Texas Gov. Rick Perry, is already being hailed in the Washington Post as “The Texas Gipper.”

The Washington Times (yes, Rev. Sun Myung Moon’s right-wing propaganda sheet is still around) fairly cooed over Perry’s tough attacks on Obama, depicting America’s first black president as someone who apologizes for America and isn’t deserving of its soldiers in uniform.

“One of the powerful reasons for running for president of the United States is to make sure every man and woman who puts on the uniform respects highly the president of the United States,” Perry said. “We are indignant about a president who apologizes for America.”

As far as Perry is concerned, America has nothing to apologize for.

These are themes right out of Ronald Reagan’s playbook. And it appears likely that Election 2012 will be fought over terrain defined by Reagan, even though he left office in 1989 and died in 2004.

It is already clear that President Obama will be on the defensive, trying to justify a role for the federal government in America and explaining why the Reaganesque policy of low taxes on the rich must finally be reversed. Obama also is certain to shy away from any serious examination of how U.S. foreign policy went so wrong, so as not to be labeled “apologist-in-chief.”

Rick Perry or whatever other Republican gets the party’s nomination will hold the high ground of Reagan’s lofty standing among the American people. The GOP nominee can continue blaming “guv-mint” for the nation’s problems and promising another “morning in America” if only the nation further reduces the size of “guv-mint.”

With Democrats also trying to associate themselves with the “greatest president ever,” it appears doubtful that any serious effort will be made to explain to the American people that the charming Reagan was the pied piper who led them to their current demise.”

[For more on these topics, see Robert Parry’s Secrecy & Privilege and Neck Deep, now available in a two-book set for the discount price of only $19. For details, click here.]

Robert Parry broke many of the Iran-Contra stories in the 1980s for the Associated Press and Newsweek. His latest book,Neck Deep: The Disastrous Presidency of George W. Bush, was written with two of his sons, Sam and Nat, and can be ordered at neckdeepbook.com. His two previous books, Secrecy & Privilege: The Rise of the Bush Dynasty from Watergate to Iraq and Lost History: Contras, Cocaine, the Press & ‘Project Truth’ are also available there.