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Reason Magazine: Rand Paul Is Right, Carter Was Thriftier Than Reagan
REASON ^ | 04/25/2014 | Nick Gillespie

Posted on 04/25/2014 7:04:19 AM PDT by SeekAndFind

Mother Jones does love found footage, doesn't it? The progressive mag's airing of Mitt Romney's "47 percent" comments at a fundraiser definitely hurt the former Massachusetts governor in his attempt to boot President Obama in 2012.

Now Mojo is back with the vid above, which the mag must hope will discombobulate Republicans and help put the brakes on a libertarian-leaning senator whose anti-war and anti-NSA stances draw long looks from disaffected liberals and lefties.

"Rand Paul: Jimmy Carter was better on the budget than Ronald Reagan" is how the vid begins. It shows the Kentucky senator in a variety of settings between 2007 and 2009 slagging St. Reagan as a spendthrift.

As Mediaite's Andrew Kirell points out, all of Paul's basic statements about spending under Reagan are absolutely true. The short version: Reagan spent like a drunken sailor and skipped out on the bill.

Here's a chart by Reason columnist and Mercatus Center economist Veronique de Rugy:

Mercatus CenterMercatus Center

Paul is correct to say that Reagan was worse than Carter when it came to spending. As de Rugy does the math, Carter increased real spending 17 percent over the last budget of his predecessor, Gerald Ford. Over two terms, Reagan increased spending by 22 percent over Carter's final budget. On an annualized basis, then, Carter grew spending by 4.25 precent a year, while Reagan grew it by 2.75 percent. However, when expressed as a percentage of GDP, spending under Carter averaged 20.6 percent per year while Reagan averaged 21.6 percent. Spending typically really gears up in a second-term president's final years, so it's plausible to theorize that had Carter managed to stick around for eight years, he might have equaled or surpassed what the real-world Reagan managed. Note: The paragraph above has been edited to better reflect annual spending patterns.

When it comes to debt, there's no question that Reagan was worse. Over an eight-year reign, he tallied up $1.4 trillion in deficits, or an average of $177 billion per year. Carter—a famously cheapskate Southern Baptist—racked up just $253 billion over four years, for an average deficit of $63 billon per year. Tax revenue went up sharply under Reagan, for sure, but like a Hollywood big shot, he still managed to spend ever larger amounts, resulting in an average annual deficit of 4.1 percent of GDP. The Peanut Farmer From Plains? A relatively tiny 2.3 percent of GDP. (All this data if from the Congressional Budget Office.)

Far from being the budget hawk of lore, Dutch had no problem jacking overall spending through the roof, especially when it came to military spending. As Reagan's first budget director, David Stockman, told Reason in 2011:

reason: Reagan was famous for saying that government wasn’t the solution to the problem; government was the problem. Why wasn’t he more skeptical of Pentagon claims of what they needed and of where their financial estimates were coming from?

Stockman: That’s one of the mysteries of the time, I guess, and it’s one of the factors that led to the utter failure of spending control. He was utterly uninterested in any detail of the defense budget, of any of the claims for dollars made by the Pentagon. He gave them a blank check, without question, and that had a two-fold effect. One, it ballooned spending just as we were massively reducing the revenue. But second, it created an enormous political impasse. And that is, the spending increases were so huge in defense that it became almost impossible to get anybody to look at you with a straight face on Capitol Hill and say we’re gonna go after the food stamp program or school lunches, when you’re just showering tens of billions of dollars on ammunition accounts and spare parts replacements and a massive expansion of the Navy, which was totally uncalled for.

After trimming some programs early in his presidency, Reagan came around to pushing massive increases on just about everything, including education (a newly formed federal department he promised to kill upon taking office), Medicare (which he had denounced as "socialized medicine" in the early 1960s), and Social Security (before championing massive hikes in payroll taxes in his second term, he had once called for making Social Security voluntary).

In many ways, Reagan's late-life embrace of old-age entitlements may have been his worst spending legacy. Created to address very different times and a very different workforce, Social Security and Medicare were in dire straits by the 1980s and had Reagan tried, he might have been able to replace these fundamentally unsustainable and unfair transfer programs into more effective and lower-cost safety net programs. Instead he called saving Social Security and Medicare—a feat accomplished through massive increases in FICA rates—"the highest priority of my administration." By the end of his presidency, the combined employee-employer rate was 15 percent, up from 9.35 percent in 1981 (and more income was subjected to Social Security tax to boot).

CBOCBOAs I argued the other day at The Daily Beast, Reagan is the "Godfather of Groupon Government," of huge and ongoing discounts to current taxpayers. Just as Groupon makes purchases more attractive by offering major price breaks, Groupon Goverment makes government goods and services more attractive by charging taxpayers much less than the retail price.

The Godfather of Groupon Government is none other than Ronald Reagan, who campaigned on killing whole cabinet departments and then presided over deficits that were so scandalously large that even Andy Warhol felt a need to comment on them. Starting in 1983, revenue increased every year under Reagan, but so did spending...leading to a tripling of the national debt on the Gipper’s watch.

Between 1974 (when new budget rules and accounting systems were put in place) and 2013, the CBO reports that total federal revenues averaged 17.5 percent of GDP while outlays averaged 20.5 percent of GDP. Expressed in terms of dollars, the government only charged Americans 84 cents per dollar of spending. Over the course of Reagan’s two terms, revenue only covered 82 cents, thus generously offering Americans an 18 percent discount.

Whole thing here.

Three or four years ago, I heard then-Gov. Mitch Daniels (R-Ind.) give a great talk to a group of conservatives. I can't reproduce the exact phrasing but the gist went something like this. Daniels talked about going to college in the late '60s and early 1970s. He talked about how there were always a bunch of lefties and progs around on campus, talking about FDR and the New Deal and how it hadn't gone far enough. Daniels said he'd tell those folks to get bent (again, the phrasing isn't exact), because the New Deal was like 30 years ago, man, and it doesn't have very much to do with today's America.

So far, so good. Conservative-libertarian audiences like peeing on campus radicals and FDR. Daniels pulled some applause and hoots. But then he went on to say something that was really fricking awesome. He pointed out that here "we"—Republicans, he meant, or maybe fiscal conservatives more broadly—were in the 2000s and all "we" could do was invoke St. Ronald Reagan like he was the second coming of Jesus H. Christ (again, not his phrasing). Daniels looked around the room and said, You know, we're further in time from Reagan than those half-baked New Dealers were when I was in college. We've got to get new ideas, new policies, and a new vision of government. Times have changed. America has changed. Budget realities have changed.

The room was silent. Even the crickets were sitting on their hands (or whatever crickets have). In the movie of my mind, I'd like to think that I started a slow clap that eventually caught on and Mitch Daniels was carried out jubilantly by the crowd, kind of like Debra Winger is by Richard Gere at the end of Officer & a Gentlemen.

But of course none of that happened. Around the same time Daniels had also famously called for cease fire in the culture wars and for Republicans to focus on spending issues (the governor didn't mince words about how awful his former boss, George W. Bush, had been). Conservatives jumped all over him like pit bulls on a steak. Because he has a mind and was a serious thinker about policy, Daniels once discussed the effects of a possible V.A.T. tax during a talk about the legacy of Herman Kahn and was pilloried for that.

He left the podium that night having pissed off the very people who needed to hear his message the most, passed on a presidential run, and is now the president of Purdue University. If there was ever a victim of epistemic closure on the right, it was Mitch Daniels.

The point is: Take on Reagan's legacy and you're playing with fire. Especially if you're right about Reagan's terrible record on spending, which Rand Paul absolutely is. I used to think that the GOP would never move forward until it fully acknowledged just how utterly awful George W. Bush's presidency really was. Across every possible dimension—with the possible exception of immigration reform, where Dubya essentially created the DREAM Act that fills Republcan lawmakers with nightmares about cantaloupe-calved illegals "hauling 75 pounds of marijuana aross the desert"—Bush was a big-government disaster. Despite stated interest in a top-to-bottom makeover, the GOP isn't really interested in changing all that much of its general platform or vibe. Until they are, they can kiss libertarians goodbye, along with other rising segments of America. The GOP's one big ace in the hole is that they run against Democrats. But even that wears off.

Rand Paul is interested in doing things differently (check out this Google News capture of recent articles about the guy). He's actually reaching out to minority voters by talking about school choice and how free markets will help alleviate poverty and lack of opportunity. He's proposed budgets that actually cut government spending. He's the loudest political voice for civil liberties in an age of ubiquitous government surveillance. He's pushing back against exaggerated fears of voter fraud and dumbed-down arguments about global warming. He's smart on military spending, which is to say he's against limitless defense spending and blunderous foreign policy.

He's not perfect from a libertarian angle—no politician is—but he is a damn serious threat to the Republican establishment. And to the Democratic status quo too. Which explains both why conservatives and establishment Republicans are going after him and lefty progs want to see him take a powder. And why his star is rising among the growing number of political independents who are sick of living in a fantasyland of the past and a thoroughly disappointing present. When the knives come out to cut him down to size—from the right and from the left—I hope he has the guts to stick to his libertarian guns.

Over the past dozen-plus years, we've seen what conventional Republicans and Democrats have to offer America, and it ain't pretty. Change is needed and it ain't going to be easy. But that just makes it more important to fight for.


TOPICS: Business/Economy; Constitution/Conservatism; Culture/Society; Editorial; Government; News/Current Events; Politics/Elections
KEYWORDS: 2016election; carter; carterlegacy; desmondtutu; iran; jimmycarter; lebanon; libertarians; mittromney; motherjones; nickgillespie; ntsa; paulians; paultardation; paultardnoisemachine; randpaul; randpaul2016; randpaulnoisemachine; randsconcerntrolls; reagan; reaganbashing; spending; stfu
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1 posted on 04/25/2014 7:04:19 AM PDT by SeekAndFind
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To: SeekAndFind
But Reagan's lower-tax policies increased revenues.
2 posted on 04/25/2014 7:05:07 AM PDT by E. Pluribus Unum ("The more numerous the laws, the more corrupt the government." --Tacitus)
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To: SeekAndFind

Reason Magazine is a libertarian rag. Naturally they would come to the defense of Paul. Now whether the facts they cooked up here are accurate or not is a different matter.

But when you start from the left, anything can happen.


3 posted on 04/25/2014 7:08:20 AM PDT by Responsibility2nd (NO LIBS. This Means Liberals and (L)libertarians! Same Thing. NO LIBS!!)
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To: E. Pluribus Unum

This is true, and I’d say something else: the very notion that a President “increases spending” is just not true. Reagan lost many spending battles to a liberal Congress, and he horse traded with them to grow the economy, and he lowered tax rates, and he defeated the Soviet Union.

Not that a hard core libertarian rag ever thought the Soviets were a big deal in the first place.


4 posted on 04/25/2014 7:10:19 AM PDT by C. Edmund Wright (Tokyo Rove is more than a name, it's a GREAT WEBSITE)
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To: E. Pluribus Unum

Let’s get one thing straight — INCREASED SPENDING UNDER REAGAN IS NOT ENTIRELY HIS FAULT.

His investments in national security ended the Cold War and made possible the subsequent defense spending reductions that are largely responsible for the subsequent federal surpluses ( To which the Gingrich congress gets greater credit than Clinton himself, who had to be dragged kicking and screaming to agree to the budget ).

His efforts to restrain the expansion of federal government helped to limit the growth of domestic spending despite the efforts of the Tip O’Neil congress to INCREASE IT.

If Reagan’s critics had been willing to work with him to limit domestic spending even further and to control the growth of entitlements, the budget would have been balanced five to ten years sooner and without the massive tax increase imposed in 1993.


5 posted on 04/25/2014 7:10:51 AM PDT by SeekAndFind (If at first you don't succeed, put it out for beta test.)
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To: SeekAndFind

The president spends only what Congress allows.


6 posted on 04/25/2014 7:11:24 AM PDT by Blood of Tyrants (Haven't you lost enough freedoms? Support an end to the WOD now.)
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To: Blood of Tyrants

RE: The president spends only what Congress allows.

But he has the veto pen.


7 posted on 04/25/2014 7:12:20 AM PDT by SeekAndFind (If at first you don't succeed, put it out for beta test.)
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To: SeekAndFind

Carter saved the money on the military, which Reagan had to rebuild.

Reagan campaigned as a budget slasher in 1976 ($90 billion budget cut). He outlined the cuts. Suffered dearly from political blowback, especially as the cutting SocSec mantra had even more currency then. Since then, he decided to work on the tax side of the equation.

First week in, hiring freeze.

Late in office he did allow the SS taxes to be increased, or it would have bankrupted. We had a healthy enough economy back then to pull it off.

Not a perfect man, but did very well with what he inherited.


8 posted on 04/25/2014 7:13:27 AM PDT by Dr. Sivana ("I'm a Contra" -- President Ronald Reagan)
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To: SeekAndFind

‘On an annualized basis, then, Carter grew spending by 4.25 percent a year, while Reagan grew it by 2.75 percent’

So how is 2.75% greater than 4.25% — as the article alleges?!

The old saying is proven again: “There are liers, d*mn liars, and statisticians”.


9 posted on 04/25/2014 7:13:39 AM PDT by Innovative ("Winning isn't everything, it's the only thing." -- Vince Lombardi)
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To: SeekAndFind
Rand Paul: another RINO who barks to the sound of the Racism dog whistle.

What else does the Left p0wn you on, Rand?

10 posted on 04/25/2014 7:15:26 AM PDT by kiryandil (turning Americans into felons, one obnoxious drunk at a time (Zero Tolerance!!!))
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To: SeekAndFind

“Rand Paul: Jimmy Carter was better on the budget than Ronald Reagan”

If Rand Paul prefers Carter to Reagan, he has no business running for president as a Republican.


11 posted on 04/25/2014 7:19:16 AM PDT by Innovative ("Winning isn't everything, it's the only thing." -- Vince Lombardi)
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To: C. Edmund Wright
Reagan didn't use "a pen and a phone" to dictate policy.

Congress decides how much to spend. A President who respects the Constitution can't stop them.

12 posted on 04/25/2014 7:22:44 AM PDT by E. Pluribus Unum ("The more numerous the laws, the more corrupt the government." --Tacitus)
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To: SeekAndFind

Reagan also had a Cold War to win. That was his goal.

As opposed the incompetent “intellectual” Jimmy Carter was regarding foreign affairs. The man who watched Iran fall and the Soviet Union move into Afghanistan and the problems caused by that incompetence we are still dealing with today.

It will be the same when Captain Midnight departs the White House.


13 posted on 04/25/2014 7:23:12 AM PDT by headstamp 2 (What would Scooby do?)
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To: SeekAndFind

http://www.ontheissues.org/Celeb/Jimmy_Carter_Budget_&_Economy.htm

Jimmy Carter on Budget & Economy

Failed to control inflation and unemployment

On assuming office in 1977, President Carter inherited an economy that was slowly emerging from a recession. He had severely criticized former President Ford for his failures to control inflation and relieve unemployment, but after four years of the Carter presidency, both inflation and unemployment were considerably worse than at the time of his inauguration. The annual inflation rate rose from 4.8% in 1976 to 6.8% in 1977, 9% in 1978, 11% in 1979, and hovered around 12% at the time of the 1980 election campaign. Although Carter had pledged to eliminate federal deficits, the deficit for the fiscal year 1979 totaled $27.7 billion, and that for 1980 was nearly $59 billion.

With approximately 8 million people out of work, the unemployment rate had leveled off to a nationwide average of about 7.7% by the time of the election campaign, but it was considerably higher in some industrial states.

Source: Grolier’s Encyclopedia, “The Presidency” Dec 25, 2000

Pushed alternative energy program to fight oil shortage
Carter faced a drastic erosion of the value of the US dollar and a persistent trade deficit, much of it a result of US dependence on foreign oil.

The president warned that Americans were wasting too much energy, that domestic supplies of oil and natural gas were running out, and that foreign supplies of petroleum were subject to embargoes by the producing nations, principally by members of OPEC.

In mid-1979, in the wake of widespread shortages of gasoline, Carter advanced a long-term program designed to solve the energy problem. He proposed a limit on imported oil, gradual price decontrol on domestically produced oil, a stringent program of conservation, and development of alternative sources of energy such as solar, nuclear, and geothermal power, oil and gas from shale and coal, and synthetic fuels. In what was probably his most significant domestic legislative accomplishment, he was able to get a significant portion of his energy program through Congress.

Source: Grolier’s Encyclopedia, “The Presidency” Dec 25, 2000


14 posted on 04/25/2014 7:24:01 AM PDT by Innovative ("Winning isn't everything, it's the only thing." -- Vince Lombardi)
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To: SeekAndFind

When was the last time a president vetoed a spending bill? I can’t remember. Was it Reagan?


15 posted on 04/25/2014 7:24:17 AM PDT by Blood of Tyrants (Haven't you lost enough freedoms? Support an end to the WOD now.)
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To: SeekAndFind

Jimmah was so great, let me tell you! Put on your sweater before spending
6 hours waiting to fill your tank on your way to the unemployment line.
Jimmah personified everything we should look for in a leader - passive, liked
to kiss the sandals of our enemies- just a real turn-down-your-thermostat sort of guy.

Not that I don’t enjoy rehashing the ‘70’s & ‘80’s - but is this worth writing about in 2014?
Dang....


16 posted on 04/25/2014 7:25:14 AM PDT by februus
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To: SeekAndFind
He gave them a blank check, without question, and that had a two-fold effect. One, it ballooned spending just as we were massively reducing the revenue.

Reducing revenue? Stockman, still an assclown.

Tax revenue went up sharply under Reagan

But Stockman said it went down. LOL!

17 posted on 04/25/2014 7:30:43 AM PDT by Toddsterpatriot (Science is hard. Harder if you're stupid.)
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To: SeekAndFind

Wow... let’s not talk about the total neglect Carter gave to the military while the Soviets were gathering strength. Kinda left Reagan with no choice but to increase outlays to the DOD.


18 posted on 04/25/2014 7:32:19 AM PDT by ScottinVA (Obama is so far in over his head, even his ears are beneath the water level.)
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To: SeekAndFind

Look like that chart only levels off when the Republicans have the house.


19 posted on 04/25/2014 7:35:29 AM PDT by cdcdawg (Be seeing you...)
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To: SeekAndFind

Look at the graph, and imagine connecting a straight line from the START of the KENNEDY administration to the END of the CLINTON administration. With minor bumps to either side, the slope of the graph for ALL the administrations in that interval is essentially the same. So, overall, spending increased at about the same rate for ALL these administrations in that time interval. In other words, there was little practical difference in the RATE of growth of the government (as measured by spending) from KENNEDY thru CLINTON.

Then, notice the marked RISE in the slope starting with the BUSH 2 administration, and continued rise thereafter...


20 posted on 04/25/2014 7:37:40 AM PDT by Rebel_Ace (Tags?!? Tags?!? We don' neeeed no stinkin' Tags!)
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