Reagan vs. Clinton-their comparative economic records in graphs

by: Paul Rosenberg

Sat Feb 20, 2010 at 08:00


[Note]: If Democrats & progressives practiced hegemonic warfare, the way Republicans & conservatives do, you would be able to recite the contents of the following diary in your sleep.  Rachel Maddow, Keith Olbermann, heck, even Chris "The Osmosis Kid" Matthews would have shown you snazzier versions of the charts below a gazillion times alredy.

For conservatives, Ronald Reagan is a god.  As well he must be, since gods are not to be questioned, and conservatives are not the questioning kind. Nor is Reagan the sort who stands up to scrutiny well, as I and countless others have pointed out on occasions numberless to man (though perhaps not to women who Google).  For one thing, I can just never get over the fact that it's virtually certain he got into office by an act of treason--much like Richard Nixon did--and that Lee Hamilton, the Indiana prototype for Evan Bayh, let him get away with it. But if the political machinations of getting into office are obscure and controversial, the economic record is etched in stone in indisputable,  widely available (it's on the internet!) public data.  And this week, I just happened to stumble across a website comparing Reagan's record to that of the Clinton-who is, for modern conservatives, an antichrist-like counterpart to Reagan's godhood.

The website was created by a fellow named Patrick Ziegler way back in 2002. The best view for getting the point across is the "Charts and Commentary" view.  The charts aren't the best quality in the world (Hey!  It was 2002!), but the information they convey is devastating, and the commentary, though brief, makes sure you get the message.

For example, the first graph shows government receipts in billions of dollars:

With the following commentary [emphasis added]:

Paul Rosenberg :: Reagan vs. Clinton-their comparative economic records in graphs
Receipts during the Reagan years increased by $310 billion and by $870.8 billion under Mr. Clinton. This chart show a sharp and steady increase in revenue under Mr. Clinton which may have helped him return us to fiscal responsibility.

Two conservative myths bite the dust in this category. First, tax increases do NOT decrease revenue and tax cuts do not increase revenue more than tax increases. Conservatives also argue Mr. Reagan doubled revenue. This is NOT correct.

In 1993 President Clinton signed into law his economic plan which called for $250 billion in tax increases and $250 billion in spending cuts. Every [R]epublican in both Houses of Congress voted against the legislation. However, after [R]epublicans took control of congress in 1995 they didn't repeal the tax increases. This fact alone suggest very strongly that their first vote was pure politics and they really didn't want to balance the budget. That vote along with the tax cuts they passed under Mr. Reagan and Mr. Bush suggest very strongly they use the government purse to buy power.

You'll note that there's nothing really new about the "party of no".  And what about those two myths?

When you think about it, they were always absurd.  If lowering taxes axiomaticaly raises revenues, then why not cut them to zero? That should solve everything, right?

These myths were initially sold on the basis of the Laffer Curve, which I hope to be touching on again later this weekend.  The Laffer Curve makes a valid, but limited point--that it's possible to reach a point of diminishing returns where the tax rate is so high that government revenues will fall if the rate goes any higher, because the taxes stifle economic activity. (Or, more realistically, spur increasing rates of tax evasion.)  However, no one has ever determined what that point of diminishing returns is.  Not a problem for conservatives.  But a big problem when you run into reality, as the chart above so clearly shows.

As a geek, I'm happy to have a discussion about what's wrong with the Laffer Curve argument. But as a political realist, I know that you have to reach people who don't want to listen to reason. The historical record is lot harder to explain away than any mere argument, no matter how solid the argument might be. So repeat the record ad nauseum.


Next, the site presents those same underlying figures as a percentage of GDP:

As a percent of the economy receipts grew under Mr. Clinton and shrank under Mr. Reagan. When one considers Mr. Reagan promised a balanced budget in four years, but instead gave us the largest deficits in US history (until Mr. Bush) not only was it a broken promise, but these charts and those that follow disassemble many if not all of what conservatives say they stand for.

Conservatives, like Reagan did not believe in a balanced budget. The deficits created under Mr. Reagan are nothing more than future taxes plus interest. A reasoned individual would never give the present generation tax cuts while saddling the next with massive tax increases. But, this is exactly what Mr. Reagan and his conservative allies in Congress did.

It's important to understand that higher receipts gave us the massive surpluses, not less spending. Also, more growth in the economy didn't give us higher receipts since both presidents gave us about the same amount of growth. Two more conservative theories bite the dust.

There's a slight problem with this part of the commentary, however:

A reasoned individual would never give the present generation tax cuts while saddling the next with massive tax increases.

Reagan never intended to saddle the next generation with massive tax increases.  Massive cuts to government was what he was aiming for.  He couldn't get them directly, because even a majority of conservatives didn't want that.  But if he made things bad enough then "responsible" Democrats would do the cutting for him, provided they could be scared into not even considering raising taxes.  Of course, you can't actually be responsible and fearful at the same time. But you sure can pretend to be.


Next the site presents a graph of government outlays in billions of dollars:

Spending during both presidencies was about the same. Mr. Reagan increased spending by $386.3 billion while Mr. Clinton increased spending by $379.3 billion. However, Mr. Clinton was forced to spend far more money to finance the debt than Mr. Reagan. When Mr. Reagan began his term we were spending only $112 billion a year to finance the debt. In 2000, Mr. Clinton had to spend $225 billion. See Interest on the Debt. On the other hand, Mr. Reagan had the luxury of spending on whatever programs he wanted (since the deficits didn't really matter to him), including the biggest pork program in the government...the US military.

Not much to add to that, except that things are a lot clearer if you look at these same figures as a percentage of GDP:

The striking difference between the two presidents can be seen here. Mr. Reagan began his presidency on a spending spree, increasing spending as a percent of the economy every year through 1985 (the year after his reelection). For the rest of his term spending declined. It should be noted Iran/Contra broke in late 1986 and the [R]epublicans lost control of the Senate in the same year.

So a [R]epublican president and congress gave us massive spending and our highest deficits for six years, but spending was dramatically cut after the [D]emocrats regained control of the Senate in 1987.

Spending under Mr. Clinton declined every year.

I just want to add one layer of additional detail to the above account.  Two things should be noted.  First, the Democrats recaptured the Senate in 1986, despite the fact Robert Parry's initial reporting on the Iran/Contra scandal was ignored by the rest of the DC press corps. The story didn't re-emerge until it was surfaced in a Middl East paper after the election.  Second, a major reason the Democrats regained control was a massive voter-registration drive carried out by Jesse Jackson among Southern blacks.  Democrats netted an eight-seat gain that year, knocking off seven GOP incumbents, of whom four were from the South: Jeremiah Denton (R-AL), Paula Hawkins (R-FL), Mack Mattingly (R-GA), James Broyhill (R-NC).  



[Section Updated: h/t to Obamamama in comments]

Budget Deficits/Surpluses

The final chart & commentary I'll include from this taste of what's on the site is budget deficits/surpluses as a percentage of GDP.  Since deficits & surpluses represent changes in debt level, this chart relates directly to the earlier charts I've presented of debt-to-GDP ratios.  The chart title's neglect surpluses--which Clinton produced for the first time in decades--is misleading. The line going up means deficits are going down--and eventually into surplus.

Deficits as a percent of our economy shrank every year under Mr. Clinton and as you can see from the chart never recovered from the Reagan spending spree and tax cuts in the 1980's. Any evidence Mr. Reagan was for less government or a balanced budget can not be found in the facts. Mr. Reagan spoke of both, but delivered the opposite.

Oddly enough, Mr. Clinton was attacked by conservative [R]epublicans for his spending programs. All one has to do is review the deficits under both presidents to see which party and which president wanted more government and more taxes (deficits are future taxes plus interest).

Deficits as a percent of gdp peaked in 1985 and fell every year after under Mr. Reagan, while under Mr. Clinton deficits as a percent of the economy fell eight years in a row.

By the time [R]epublicans got around to passing the balanced budget plan in 1997 for fiscal year 1998, the deficit was almost gone. Anyone attempting to give them credit for the balanced budget is sadly mistaken. Their five-year plan calls for our first balanced budget in 2002 ( a year Mr. Bush has once again returned us to deficits). Their plan was only five years off. Our first balanced budget occurred in 1998.

Conservative/GOP rhetoric on budget matters has been so dominant--so unified and all-pervasive, precisely according to the model of hegemonic struggle--that it's utterly buried the basic facts pointed out above.  Republicans switch directions on budget matters the way a world-class running back switches directions on a 50-yard TD run.  They don't so much contradict themselves overtly (though they do do that), so much as they take up entirely different themes, depending most of all on who's in the White House, but also on the short-term goals of the moment, regardless of how they fit into the long-term strategy.  On whatever theme they choose to pick up, they do so with massive uniformity and echo-chamber effects, so as to totally dominate the terms of discussion, and stifle the very possibility of meaningful debate.

That's hegemony, baby.  And this little website is a concentrated little arsenal of some very basic info for fighting back with.


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Excellent diary, but, (4.00 / 1)
isn't the deficit chart inverted?  Clinton's is rising and Reagan's is going down?

It's Not Inverted, But.,.. (0.00 / 0)
It is misleading, so I rewrote the section to clarify.

Thanks!

"You know what they say -- those of us who fail history... doomed to repeat it in summer school." -- Buffy The Vampire Slayer, Season 6, Episode 3


[ Parent ]
Thanks for the confirmation. (0.00 / 0)
n/t

[ Parent ]
deficit chart inverted? (0.00 / 0)
Either that, or there is something about the scaling of the Y axis that makes this confusing.  Going back to Paul's source material, and looking at the graph for Deficits - $ billion, I wonder about that negative dollar scaling.  The first sentence following that graph reads, No matter how we cut it, the rise in the surplus during the Clinton years was truly historic.  That suggests to me that the author of these graphs intends to suggest that this steep climb into positive dollar territory has less to do with deficits than with dollars available above planned expenditures.  If so, then I read Clinton climbing out of a $300bil hole in Year 1 to a ~$250bil surplus by year 8, with the zero point on the Y axis being the government's "break even" point.  If I've interpreted the original author's Deficits - $ billion chart correctly, then the one Paul has excerpted makes sense.


[ Parent ]
But Rachel, Keith and Chris.... (0.00 / 0)
will NEVER report these charts (even if they made them snazzier) because they give someone named Clinton credit.

Never.  Going.  To.  Happen.


But Rachel, Keith and Chris.... (0.00 / 0)
will NEVER report these charts (even if they made them snazzier) because they give someone named Clinton credit.

Never.  Going.  To.  Happen.


Sorry - I felt so strongly about my comment... (0.00 / 0)
I had to repeat myself.  :>)

Can you edit out the second one?


[ Parent ]
Your comment is so likely, (4.00 / 1)
grimly true, it's probably worth repeating.

[ Parent ]
Right on about the general Republican ideology (0.00 / 0)
although I'm less charitable than Mr. Ziegler when it comes to Clinton.  Much of the financial prudence credited to Clinton was the effect of a not-yet-popped bubble.  Of course Repubs participated in bubble-growth too, so they get no credit.  

But these data at least certainly refute the idea that Democrats were WORSE than Republicans when it comes to deficits.  And that's still important.

sTiVo's rule: Just because YOU "wouldn't put it past 'em" doesn't prove that THEY did it.


True. But, Ziegler's analysis was done in 2002. (0.00 / 0)
If you look at the source material for Median Family Income, it looks to me like there was a broader participation in getting the "goods" from that bubble as compared to, say, the last one under BushII.

Under Savings - %gdp, Ziegler observes,

I'm not too sure why some think the savings rate is important when so many Americans have money invested in the stock market. The markets clearly out perform savings accounts so I'm not sure what all the fuss is about.

Doesn't that turn out to be ironic?

Bubbles are no way to promote prosperity because it's an illusion of prosperity.  It ain't the real deal.  But we know more now than we did in 2002.  So, I'll cut Ziegler a little slack for not being more prescient than he could have been.


[ Parent ]
Clinton Was A Neoliberal (4.00 / 6)
Worse than the bubble was the accelerated de-industrialization due to NAFTA and other neo-liberal policies, including financial de-regulation.  So, yes, Clinton has a lot to answer for.

But when you compare what Clinton did within the confines of conservative hegemony, and compare it to what Obama is up to, Clinton starts looking pretty damn good all over again.

"You know what they say -- those of us who fail history... doomed to repeat it in summer school." -- Buffy The Vampire Slayer, Season 6, Episode 3


[ Parent ]
Not so fast there, buddy. ;^) (0.00 / 0)
I have to pile on a bit here. In addition to NAFTA, including it's toxic Chapter 11 (which attempts to destroy national sovereignty in favor of corporations), there's also the taxpayer subsidies to corporations that off-shore it's workforce. There's also the complete lack of any attempts at limiting wage, regulatory and environmental arbitrage--even though NAFTA had provisions to limit those things, they were never enforced. Clinton's mindless and greedy embrace of globalization always was going to be a disaster, as a lot of people pointed out at the time.

But it gets worse.

Clinton also championed the Telecom Act of '96, which gave us the media consolidation that resulted in the monolithic corporatist media establishment we have today. So major demerits on this one as well.

Clinton also championed the deregulation that directly resulted in the financial crisis we're going to be struggling with for a very long time. The rampant bubble-blowing, coupled with destroying our manufacturing base and an over-valued dollar have done our economy irreparable harm.

In other words, Clinton is at the very heart of why our economy is so screwed. He is a major cause of our current unemployment, wage destruction, popped housing bubble, TBTF banks and essentially handing over the keys to the White House to Wall Street. In this economy, poverty is the new black and that's very much a buy-partisan effort.

Clinton also championed "welfare reform," which only sanctified the growth of the permanent underclass.

It is my hope the party base one day starts to see all this in context and judge The Big Dog accordingly. Democratic presidents are in the business of doing as much harm to the Democratic base as they can get away with.

"More than any other time in history, mankind faces a crossroads. One path leads to despair and utter hopelessness. The other, to total extinction. Let us pray we have the wisdom to choose correctly." -Woody Allen, My Speech to the Graduates


[ Parent ]
It might be an error... (0.00 / 0)
In this economy, poverty is the new black and that's very much a buy-partisan effort.

... or, ought to qualify for the "inspired-typo" award of the day, but I'm more inclined to think it was purposeful and brilliantly ironic.


[ Parent ]
Why, thank you. (0.00 / 0)
It's not a typo. To me, it reflects reality better than the "proper" spelling.

Irony is not dead! Not yet anyway!

"More than any other time in history, mankind faces a crossroads. One path leads to despair and utter hopelessness. The other, to total extinction. Let us pray we have the wisdom to choose correctly." -Woody Allen, My Speech to the Graduates


[ Parent ]
But This Raises The Question (0.00 / 0)
why buy partisans, when you can rent them dirt cheap?

"You know what they say -- those of us who fail history... doomed to repeat it in summer school." -- Buffy The Vampire Slayer, Season 6, Episode 3

[ Parent ]
Good question. (0.00 / 0)
To be sure, you make better economic sense than my pun does... But my pun sounds better than Rent-A-Partisan. Wait, that's not too bad. But then it's not a play on words... Ugh, back to the drawing board for me!

"More than any other time in history, mankind faces a crossroads. One path leads to despair and utter hopelessness. The other, to total extinction. Let us pray we have the wisdom to choose correctly." -Woody Allen, My Speech to the Graduates

[ Parent ]
Don't Worry (0.00 / 0)
I've used that pun myself for years.  Which is why I like to riff on it the way I did.

"You know what they say -- those of us who fail history... doomed to repeat it in summer school." -- Buffy The Vampire Slayer, Season 6, Episode 3

[ Parent ]
Well, All That Stuff Is Part of Neoliberalism (0.00 / 0)
But Clinton was at least someone conscious of its limitations, divided in his commitments, and interested in doing things with offsetting impacts--such as the EITC, for example, which really did make a substantial impact in the late 90s.

I'm not saying this to excuse Clinton, but only to highlight how totally tunnel-vision the neoliberals have become since him.  Bad as welfare reform has been, for example, it was not what Clinton originally intended.  He wanted to include a raft of provisions to provide support for single mothers becoming productive in the marketplace. It wouldn't have been enough, of course.  But the system it was replacing wasn't enough, either.  So it might well have been an improvement overall, and it could have been improved upon even more.

The problem with Clinton was that--for purely political reasons--he ended up signing a completely lopsided, punitive rightwing version, and hanging all sorts of defenders of a more sane policy out to dry.  But at least he knew it was bad policy.  Obama & co, however, have no such awareness.

"You know what they say -- those of us who fail history... doomed to repeat it in summer school." -- Buffy The Vampire Slayer, Season 6, Episode 3


[ Parent ]
Good points (0.00 / 0)
I think the difference in our perspectives is that I view Clinton as a part of the continuum of neo-liberal rule... albeit an earlier part of it. So while your points on Clinton's own views of what was okay to do in public are valid, it's also true that Clinton, perhaps more than Poppy Bush, still managed to shove the Overton Window farther to the right by couching it in his charismatic, pseudo-humanistic terms: A rising tide lifts all boats, etc.

Obama is doing much the same thing, but his starting point is already much farther to the right of Clinton's starting point. In this sense, I see virtually no real difference, since they are doing the exact same thing: pushing the Democratic Party and society ever farther to the right.

Maybe you're right about Clinton wanting a better "reform" policy. I'm afraid my memory is a tad fuzzy on this. But I do clearly remember the point of that effort really was to simply get people off the rolls... more than anything else. I don't doubt that he may have wanted to do it in a somewhat more civilized fashion, but the fact is he signed the bill with a lot of enthusiasm anyway. If he really didn't like it, he should have vetoed it.

Indeed, over at Crooks & Liars, they have a recent example of just how horrid Welfore Deform really is:

http://crooksandliars.com/susi...

I'm sure he also knew NAFTA was bad economics too, especially Chapter 11, but he also knew there were serious payoffs and he was probably more interested in those than good policy.

I've always been critical of Bill Clinton. SInce the early days of his first preznit primary--I did not vote for him in the primaries. But I've also seen him speak a few times and to this day I can't help saying to myself, "Hate his policies all you want, you still have to hand it to the guy, it's damn near impossible to dislike the guy personally."

But back then, Clinton had a lot more political room to operate in. The country wasn't openly bent of self-destruction, wasn't in an economic disaster yet and he was a very likable Not-Bush. He still methodically pushed the party to the corporatist right, but was able to avoid responsibility for his policies that we're paying dearly for now.

So while I agree Obama is much more a radical rightist, it was Clinton that laid the groundwork for Shrub and Obama to push ever farther right--by somehow making it palatable with his "I feel yer pain" nonsense. And it was Reagan/Poppy Bush that laid the groundwork for Clinton.

And so it goes....

"More than any other time in history, mankind faces a crossroads. One path leads to despair and utter hopelessness. The other, to total extinction. Let us pray we have the wisdom to choose correctly." -Woody Allen, My Speech to the Graduates


[ Parent ]
I Don't Think We Disagree At All (0.00 / 0)
We're just focusing on different parts of the old elephant, that's all.  In another context, I'd be saying exactly what you're saying here.

"You know what they say -- those of us who fail history... doomed to repeat it in summer school." -- Buffy The Vampire Slayer, Season 6, Episode 3

[ Parent ]
excellent diary Paul (0.00 / 0)
another demolition of the 'fiscal conservative' meme

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