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Reaganomics at 25
Wall Street Journal ^ | August 12, 2006 | Wall Street Journal

Posted on 08/12/2006 12:46:58 PM PDT by Tolerance Sucks Rocks

Twenty-five years ago this weekend, Ronald Reagan signed the Economic Recovery Tax Act. The bill cut personal income tax rates by 25% across the board, indexed tax brackets for inflation and reduced the corporate income tax rate. The anniversary is worth commemorating as a seminal moment that continues to influence policy for the better in the U.S., and around the globe.

The achievement of Reaganomics can only be fully understood by recalling the miserable state of affairs a quarter-century ago. Newsweek summarized the national mood when it wrote in 1981 that Reagan "inherits the most dangerous economic crisis since Franklin Roosevelt took office 48 years ago."

That was no exaggeration. The economy was enduring a cycle of rising inflation with growing levels of unemployment. Remember 20% mortgage interest rates? Terms like "stagflation" and "misery index" entered the popular vocabulary, and declinists of various kinds were in the saddle. The perception of American economic weakness encouraged the Soviet empire to ever bolder adventures, as reflected by Soviet tanks in Kabul and Communists on the march in Nicaragua and Africa.

The reigning Keynesian policy consensus had no answer for this predicament, and so a new group of economic ideas came to the fore. Actually, they were old, classical economic ideas that were rediscovered via the likes of Milton Friedman and the Chicago School, Arthur Laffer, Robert Mundell, and such policy activists in Washington as Norman Ture and Jack Kemp, among others. These humble columns under our late editor, Robert Bartley, led the parade.

(Excerpt) Read more at online.wsj.com ...


TOPICS: Business/Economy; Constitution/Conservatism; Editorial; Government; News/Current Events; Philosophy
KEYWORDS: economy; globaleconomy; happybirthday; inflation; interestrates; laffercurve; marginaltaxrates; prosperity; reaganomics; ronaldreagan; ronaldusmagnus; stagflation; supplyside; taxcuts; taxes

1 posted on 08/12/2006 12:46:59 PM PDT by Tolerance Sucks Rocks
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To: abner; Abundy; AGreatPer; alisasny; ALlRightAllTheTime; AlwaysFree; AnnaSASsyFR; Angelwood; ...

PING!


2 posted on 08/12/2006 12:47:39 PM PDT by Tolerance Sucks Rocks (Going partly violently to the thing 24-7!)
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To: Tolerance Sucks Rocks
absoulte ever-loving rock and roll holy prosperity, batman BUMP for later!
3 posted on 08/12/2006 12:48:51 PM PDT by the invisib1e hand ("These formidable people....will die for Liberty")
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To: Tolerance Sucks Rocks
Newsweek summarized the national mood when it wrote in 1981 that Reagan "inherits the most dangerous economic crisis since Franklin Roosevelt took office 48 years ago."

This shows you how biased the media has become in the past quarter century -- they would NEVER say this today.

4 posted on 08/12/2006 12:51:47 PM PDT by wagglebee ("We are ready for the greatest achievements in the history of freedom." -- President Bush, 1/20/05)
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To: wagglebee
TRUE!

in fact, if "JC, the peanut man" was leaving office, the mainSLIME media would say the economy was TOTALLY the GOP's fault!

free dixie,sw

5 posted on 08/12/2006 12:54:01 PM PDT by stand watie ( Resistance to tyrants is OBEDIENCE to God. -----T.Jefferson)
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To: Tolerance Sucks Rocks
This is a lesson the boyz over at the Federal Reserve ought to learn. It's high taxes that cause inflation and not a hot economy.
6 posted on 08/12/2006 12:54:15 PM PDT by Falcon4.0
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To: Tolerance Sucks Rocks

Reaganomics died at the age of 20.


7 posted on 08/12/2006 12:56:33 PM PDT by Moonman62 (The issue of whether cheap labor makes America great should have been settled by the Civil War.)
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To: Tolerance Sucks Rocks

Short term unemployment pain gave way to long term gain.

Unemploment %

Year Ann Avg
1948 3.8
1949 5.9
1950 5.3
1951 3.3
1952 3.0
1953 2.9
1954 5.5
1955 4.4
1956 4.1
1957 4.3
1958 6.8
1959 5.5
1960 5.5
1961 6.7
1962 5.5
1963 5.7
1964 5.2
1965 4.5
1966 3.8
1967 3.8
1968 3.6
1969 3.5
1970 4.9
1971 5.9
1972 5.6
1973 4.9
1974 5.6
1975 8.5
1976 7.7
1977 7.1
1978 6.1
1979 5.8
1980 7.1
1981 7.6
1982 9.7
1983 9.6
1984 7.5
1985 7.2
1986 7.0
1987 6.2
1988 5.5
1989 5.3
1990 5.6
1991 6.8
1992 7.5
1993 6.9
1994 6.1
1995 5.6
1996 5.4
1997 4.9
1998 4.5
1999 4.2
2000 4.0
2001 4.7
2002 5.8
2003 6.0
2004 5.5
2005 5.1


8 posted on 08/12/2006 12:58:12 PM PDT by operation clinton cleanup
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To: Tolerance Sucks Rocks
Since I don't subscribe to the WSJ, can't finish the article.

Check this out:

"THE REAL REAGAN RECORD" National Review Online, August 31,1992

Go here for the CATO analysis Supply Tax Cuts and the Truth About the Reagan Economic Record,by Stephen Moore

God bless Ronald Reagan.

9 posted on 08/12/2006 1:18:45 PM PDT by Reagan Man (Conservatives don't support amnesty and conservatives don't vote for liberals!)
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To: operation clinton cleanup

Lefties always bring up that Carter paid down the deficit when he was President, as if that matters to someone paying gigantic interest rates on mortgages.


10 posted on 08/12/2006 1:22:37 PM PDT by Democratshavenobrains
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To: wagglebee

Oh they'd say that today if a Democrat took over.


11 posted on 08/12/2006 1:36:39 PM PDT by farlander (Strategery - sure beats liberalism!)
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To: Democratshavenobrains

Or not being able to pay a mortgage because of the double-digit unemployment that had gripped the country.


12 posted on 08/12/2006 1:37:02 PM PDT by AdvisorB (For a terrorist bodycount in hamistan, let the smoke clear then count the ears and divide by 2.)
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To: farlander

Oh yeah. If there was 0% unemployment, every person lived in a paid-off house, had a years salary in savings and zero debt, the media would still say it was the worst economy ever.


13 posted on 08/12/2006 1:42:33 PM PDT by wagglebee ("We are ready for the greatest achievements in the history of freedom." -- President Bush, 1/20/05)
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To: Moonman62

Reaganomics died at the age of 20.

Reaganomic was repeated at the age of 20. What do you think drove all the various Bush Taxcuts? But of course the knee jerk hysteric Bush haters on the Freeper Fringes cannot be bothered with a little thing factual reality.


14 posted on 08/12/2006 1:52:14 PM PDT by MNJohnnie (History shows us that if you are not willing to fight, you better be prepared to die)
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To: Democratshavenobrains

And could not find a job or a tank of gas.


15 posted on 08/12/2006 1:53:04 PM PDT by MNJohnnie (History shows us that if you are not willing to fight, you better be prepared to die)
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To: Tolerance Sucks Rocks

What's up with this subscriber crap at the WSJ? I wanted to read the entire article and send it to some "I love Jimmy Carter" liberal friends of mine.


16 posted on 08/12/2006 1:53:41 PM PDT by Cobra64 (All we get are lame ideas from Republicans and lame criticism from dems about those lame ideas.)
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To: operation clinton cleanup
2005 5.1.

The correct number for 2005 is 4.6.

17 posted on 08/12/2006 1:54:42 PM PDT by MNJohnnie (History shows us that if you are not willing to fight, you better be prepared to die)
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To: operation clinton cleanup

Oh by the way. Considerably women were in the work force in 1969. Are your numbers adjusted for the exanded workforce?

Oh of course not. That would wreck the spin line.


18 posted on 08/12/2006 1:56:06 PM PDT by MNJohnnie (History shows us that if you are not willing to fight, you better be prepared to die)
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To: MNJohnnie
Reaganomic was repeated at the age of 20. What do you think drove all the various Bush Taxcuts? But of course the knee jerk hysteric Bush haters on the Freeper Fringes cannot be bothered with a little thing factual reality.

Tax cuts that were intended to push demand. Reganomics is supply side, not the stuff that W is doing. Remember that the next time you buy gas. RIP Reaganomics.

19 posted on 08/12/2006 2:14:08 PM PDT by Moonman62 (The issue of whether cheap labor makes America great should have been settled by the Civil War.)
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To: MNJohnnie

Take it easy! I found those stats here:

http://www.bls.gov/cps/prev_yrs.htm


20 posted on 08/12/2006 2:18:07 PM PDT by operation clinton cleanup
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To: aflaak

ping


21 posted on 08/12/2006 2:18:33 PM PDT by r-q-tek86 (** Tagline Removed By Admin Moderator **)
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To: Tolerance Sucks Rocks

"Voo-doo" Economics at 25 too. (Bush I PWN3D!)


22 posted on 08/12/2006 2:19:26 PM PDT by Extremely Extreme Extremist (404 Page Error Found)
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To: operation clinton cleanup

Unemploment %
1981 7.6
1982 9.7


No wonder I enlisted....Unemployment rates were even worse in Mi....


23 posted on 08/12/2006 2:37:32 PM PDT by dakine
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To: dakine

That should be unemployment %!


24 posted on 08/12/2006 2:44:06 PM PDT by operation clinton cleanup
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To: Tolerance Sucks Rocks

One Freepers name says it all for me - LongsForReagan.
How dearly I miss that great, great man.


25 posted on 08/12/2006 3:13:21 PM PDT by AmericaUnited
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To: wagglebee
If there was 0% unemployment

I know you're invoking hyperbole to make your point, but you really don't want 0% unemployment. People would riot with frustration.

26 posted on 08/12/2006 3:23:00 PM PDT by the invisib1e hand ("These formidable people....will die for Liberty")
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To: Moonman62
Reganomics is supply side, not the stuff that W is doing
Reaganomics is across-the-board tax cuts, not only top-rate cuts exclusively which would be "supply side" only.

27 posted on 08/12/2006 4:14:39 PM PDT by conservatism_IS_compassion (The idea around which liberalism coheres is that NOTHING actually matters except PR.)
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To: Tolerance Sucks Rocks
It took the 16th Amendment to make the income tax constitutional.

Maybe we should propose an amendment to limit the maximum tax rate (lots of folks would advocate a limit of zero, in favor of a national sales tax).

28 posted on 08/12/2006 4:20:22 PM PDT by conservatism_IS_compassion (The idea around which liberalism coheres is that NOTHING actually matters except PR.)
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To: Tolerance Sucks Rocks

I'll read this later.

Right now I am suffering from malaise.


29 posted on 08/12/2006 5:22:46 PM PDT by El Sordo
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To: Tolerance Sucks Rocks

Some Reagan jokes:

"It is said that Castro was making a speech to a large assembly. And he was going on at great length and then a voice out in the crowd said, 'peanuts, popcorn, crackerjacks.' and he went on speaking and again the voice said, 'peanuts, popcorn, crackerjacks,'" Mr. Reagan said. "And about the fourth time this happened, he stopped in his regular speech and he said, "the next time," he said, "I'm going to find out who that is and kick him all the way to Miami.' And everybody in the crowd said, "peanuts, popcorn, crackerjacks.'"


A commissar in the Soviet Union went out to one of those state collective farms, grabbed the first worker he came to and said, 'Comrade, how are the crops?' "'Oh,' he said, 'Comrade Commissar, if we could put the potatoes in one pile, they would reach the foot of God.'" "And the commissar said, 'This is the Soviet Union. There is no God.' and he said, 'That's all right, there are no potatoes.'


30 posted on 08/12/2006 5:37:34 PM PDT by traviskicks (http://www.neoperspectives.com/Amnesty_From_Government.htm)
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To: conservatism_IS_compassion
Where would you fit Sarbanes-Oxley into Reaganomics, or no vetoes on spending bills, or a persistent weak dollar policy?
31 posted on 08/12/2006 7:14:27 PM PDT by Moonman62 (The issue of whether cheap labor makes America great should have been settled by the Civil War.)
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