Reagan and Deficits

H

huisache

2,500+ Posts
During the years when Ronald Reagan (may his name be praised) was President of these United States, we went from being the world's greatest creditor nation to the world's greatest debtor nation.

And everything, as they say, was rosy. We could cut taxes and raise spending and the only thing that happened was that the budget deficit ballooned and the national debt exploded.

Thus proving, as W's Treasury Secretary quoted Vice President Cheney, hallowed be his name, to the effect that Reagan proved deficits don't matter.

I learned so much from living through those glorious years of Morning in America.
 
Tip O'Neill was an outspoken liberal Democrat and influential member of the U.S. Congress, serving in the House of Representatives for 34 years and representing two congressional districts in Massachusetts. He was the Speaker of the House from 1977 until his retirement in 1987, making him the second longest-serving Speaker in U.S. history after Sam Rayburn, and the longest consecutive serving Speaker.


As Reagan once said, "Tip O'Neill is like the Pac-Man, a round thing that gobbles up money".
 
It sounds like you think it's unfair to criticize Obama for the current deficits. There's a difference. In 1985, there were plenty of lenders willing to loan us money. In 2011, we're getting pretty close to running out of lenders. Do you know how big the global GDP is? Do you know what percent of it is represented by annual US deficit under Obama?
 
We are not going to run out of lenders anytime soon. But reagan's deficit in no way comes anywhere close to obama's, which is the cumulative fault of Reagan, bush, Clinton, bush, and Obama. We had a grand opportunity to act and we didn't do enough. I am somewhat tempered on my anger, though, because the Tea Party really has no concept of unintended consequences. You really need to listen to Bernanke over Paul these days. But there was much more we could do in terms of eliminating pure waste.

And reagan's tax decreases far outweighed any increases. What a stupid argument that is.
 
It is interesting that Reagan’s biggest deficit came in 1983, when it reached 6 percent of the gross domestic product -- about two-thirds the size of the shortfalls the government has run in each of the past three years.
 
Reagan was successful in turning around one of the worst economies of all time. Unlike our incumbent president whose policies have utterly failed.
 
re Wiki debt figures: you can have a national debt and still be a creditor nation.

And Reagan did inherit an economy in distress, largely because of the oil embargo. He cut a deal with the Saudis in which they got AWACS (he overrode the objections of the Israelis) and we got them to pump oil like crazy and undermine OPEC. IT wrecked the Texas economy (anybody else remember that?) but it bailed the US economy.

My point, poorly presented I admit, is that it was under Reagan that the Republicans quit acting like grownups, which had always been their function. Thus, Cheney being quoted by Paul O'Neil to the effect that deficits don't matter.

AS for Tip O'Neil, he was a monstrous decrepit fool. He got mad at Carter for refusing his request for a large number of inaugural seats and proceeded to publicly humiliate him. And when he got away with it he just kept doing it. Which is why I have thought since then that putting outsiders in the White House is a horrendous idea and have voted against Obama, Clinton and W and Reagan. And did vote for W's daddy, who was an insider who knew the ropes and is the most underappreciated president we have had since James Polk.

This budget disaster has been a long time coming and is a joint effort by both parties. And they did nothing yesterday but kick the can down the road again.
 
Embargo was in 73, but oil prices jumped from 5 to 15 that year leading to recession. Stabilized at that level until 78 when Iran went to hell. Then went from 15 to 38 unitl 1981. Then prices dropped.

It's amazing that Texans, of all people, ignore oil price impact on the economy. 78-81 spike = recession. 81-86 glut = recovery (except for Texas, of course). 1990 spike = small recession. 07 spike slows home prices, proves they don't always go up, bubble begins to burst.

Recessions are naturally deflationary, and oil demand drops causing price drops therein allowing growth again. It still is the fuel for the economy. If we want the economy to pick up steam, get oil prices to $60 instead of $93. Good luck with that.
 
Reagan's smallest deficit was larger than Carter's largest deficit. The unemployment rate was 7.5% when Reagan was inaugurated. Remained roughly the same or lower for the first eight months of his term.

Went to 7.6 in September 1981. Continued rising until it reached its high of 10.8 In Nov. 1982. It never got lower than when he was inaugurated until May, 1984.

Rate was 5.4 when George, Sr. was inaugurated and 6.4 when Clinton was sworn in. It was then 4.8 when George, Jr. was inauguated and 8.5 when Obama took office.

Just makes interesting talking points.
 
You guys need to stick to Bush bashing. It is much more effective.

Reagan's policies made Clinton look good and along with the loss of Tipp O'Neill paved the way for the Wall Street bubble that closed the deficit gap and allowed for decreased military funding. You partisans should be happy.
 
Why the weak personal attack? I would think a well educated person could do much better. And don't worry, I'm Mike Gundy on accepting personal abuse.
 
This thread makes me recall all of the bad mocus of the 1970s

Wage & Price controls / Nixon
Inflation / Ford
Stagflation / Carter
Arab Oil Embargo (73) / Nixon
Iranian Oil Crisis (79) / Carter
Streaking / Nixon
Disco Music / Ford & Carter
 
Unemployment soared after Reagan’s 1981 tax cuts. Unemployment jumped to 10.8 percent after Reagan enacted his much-touted tax cuts.
 
The Federal Reserve was primarily responsible for the economy of the late 1970's-early 1980's, not either Carter or Reagan ----- unless you want to laud Carter for appointing Volcker and Reagan for keeping Volcker on.
 
LOL! No joke. I can only shake my head at some of the hair-brained backwards comments made on the west mall.
 
Reagan had a lot of things to deal with when taking office. The US economy was a shambles- unemployment was high and (strangely) inflation was high- a double whammy that confounded the economists. The high inflation meant interest rates were high, too. This was the era of the double digit CD and the 18% mortgage. The stock market had been flat for over a decade.

US military strength was down, hollowed by Carter. Carter had tried to rescue the hostages, and was undone by the inability to get three helicopters across the desert. The USSR invaded Afghanistan, and the best response we had was to boycott the Moscow Olympics (didn't work).

Reagan drove tax rates down from over 60% to near 30% (Note that cutting overall tax rates by 25% did not reduce tax revenues 25%; they actually went up a little. Why do you suppose that was? Luck?). He spent on the military. Yes, he had deficits. He didn't want them, but he couldn't get everything he wanted. BTW, despite a lot of hyperbolic rhetoric from O'Neill and other Dems, Reagan could work with the other party.

By the time Reagan's second term ended, America was experiencing one of its greatest periods of prosperity, and the world's experiment with communism was headed towards conclusion. He was the greatest president of my lifetime, and by a mile.
 
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