50 Years since the Time of Choosing

[Lerodan Chinamerica]

How so?

They increased the governmental debt and enriched the topmost classes while impoverishing everyone else and creating more strain on the future taxpayers. That's a kind of revolution after all.

My God, did you bother to research any of this stuff at all? Or are you just pulling these out of nowhere? Let's analyse these one by one.

They increased the governmental debt

Actually, no. Tax revenues as a percentage of GDP declined from 18.2% of GDP in 1981 to 18.1% in 1989. Tax revenues as a % of GDP have, however, remained relatively constant since the post-war period. Real federal revenues increased from $599 billion to $991 billion, and real income tax receipts rose from $308.7 billion to $549 billion - increases of 65% and 77%, respectively. So let's leave the ridiculous claim that the national debt increased due to tax cuts at the door, shall we?

enriched the topmost classes while impoverishing everyone else

This is patently false, and indicates massive intellectual dishonesty, and you should feel bad about that. I made this comparison below to show just how much better the economy was under Reagan than it is under Obama, but all the data there is relevant to this thread.



As you can see, annualised GDP per capita growth averaged 2.56% under Reagan. 20 million new jobs were created. The labour force was expanded by 3.8%. Median household income increased by 11.8%. Real disposable income increased by 33.5%. Real per capita income increased by 65%. The poverty rate was reduced from 15% to 12.8%. Real compensation grew by 11%.

So either you're lying to yourself, or you're horribly misinformed. I suspect it's a little bit of both.

[Lerodan Chinamerica]

Roosevelt was famously ignorant of economics, and relied on a small group of professors to advise him on policy matters. They were not influenced by Keynes, since he published The General Theory in 1936. I think Roosevelt certainly had some Keynesian elements, such as lowering interest rates nearly to zero, eliminating gold and embarking on huge public works projects. But he refused to cut taxes because of his emotional hatred of businessmen. (That's not just my opinion, by the way - his verbal attacks against the business community during his presidency were frequent and ferocious.) When FDR met Keynes, he did not like him, and thought he was a "know-it all." "He's not an economist," Roosevelt said about him, "he's a mathematician."

Truman also was averse to Keynesian ideas. Despite his passionate advocacy for a "Fair Deal" and enormous stimulus programs, these were, again, ideological. He said of Keynes: "No-one could ever convince me to spend a dollar that I don't have."

Johnson could be perceived as a Keynesian. He cut the top tax rate from 90% to 70%, went to war and increased government spending enormously. But these were all done during economic expansion. If he were a Keynesian he would have done the opposite to prevent the economy from "overheating".

He increased government spending immensely primarily because of the "War on Poverty" and the more infamous war, the Vietnam War.

Yes. But that's just not what you do, according to Keynesian thought, in the middle of a boom. During busts, you cut taxes and interest rates and increase spending; in a boom you do the opposite.

[Lerodan Chinamerica]

Reagan wasn't perfect, but he was the closest to perfect we've had in a while.

Also, who doesn't like Eisenhower?

The people who cut taxes down from the 90% rate at which they were. How else was the US supposed to afford the massive interstate system, and build new infrastructure?

Tax rates were never as high as 90%. It's a complete myth.

[Benuty]

The people who cut taxes down from the 90% rate at which they were. How else was the US supposed to afford the massive interstate system, and build new infrastructure?

Tax rates were never as high as 90%. It's a complete myth.

http://en.wikipedia.org/wiki/Taxation_h ... reductions

This seems to imply contrarian statements to your post destroying image that was not bothered to be spoilered.

[Lerodan Chinamerica]

Reagan is to the GOP as FDR is to the Dems. We should really start acting like it. He was one of our best presidents ever.

I really can't understand all this love of the Republicans for someone who increased governmental spending and debt so much.

He did not increase any government spending - Congress did. They decided they'd go with the military build-up, but did not cut into the welfare state as much as the administration wanted. Still, they kept domestic spending nice and flat, and declining in some areas.

Why so little love for Eisenhower? Even NIXON was better than Reagan ffs!

Because Eisenhower was a hypocritical hack, and Nixon had grand delusions about himself and his ideas that led to a foreign policy of weakness and an economy of decay.

[Lerodan Chinamerica]

Tax rates were never as high as 90%. It's a complete myth.

(Image)

http://en.wikipedia.org/wiki/Taxation_h ... reductions

This seems to imply contrarian statements to your post destroying image that was not bothered to be spoilered.

Sorry about that.

You're looking at marginal tax rates rather than effective tax rates that factor in loopholes, deductions and transfer payments.

[Lerodan Chinamerica]

I really can't understand all this love of the Republicans for someone who increased governmental spending and debt so much.

Why so little love for Eisenhower? Even NIXON was better than Reagan ffs!

Reagan wasn't perfect, but he was the closest to perfect we've had in a while.

Also, who doesn't like Eisenhower?

I don't like Ike. He was a hypocrite that destroyed British foreign policy for decades due to his alleged dislike of foreign intervention, while he engineered coups in Guatemala, Vietnam and Iran to keep feudalist pro-American dictators in power. He also refused to cut taxes while had control of Congress, and while he kept spending down he grew the regulatory welfare states enormously. He was also too slow on civil rights. I could see why a - ahem - neoconservative like yourself would like Eisenhower's centre-left economic policies. But for me, all he did was engineer multiple foreign policy time bombs around the world while preserving the New Deal.

The only good Republican Presidents of the 20th Century were Reagan, Coolidge and Harding.

[Lerodan Chinamerica]

a failed economic theory (trickle-down) is seen as normal and a good thing.

You're a smart guy, Atlantic. But why do you lap up so many economic myths that have been debunked thousands of times?

"Trickle-down economics" is a meaningless political buzzword invented by the left to make Reaganomics sound evil. I have never heard of anyone that subscribes to liberal economics advocate it. That Reagan, or the Republican Party, ever believed that "cutting taxes for the richest 1% trickles down to everyone else" is stupid and demonstrably untrue. Firstly, President Reagan's goal was to cut tax rates for all to stimulate investment, consumption and wealth creation. Any reasonable economics enthusiast knows that any sort of tax blocks the creation of wealth, and that the creation of wealth is good for everybody. So, to make it simple, a tax cut for the poor helps the wealthy because they're buying more products, and a tax cut for the rich helps the poor because they're investing more in wages. So, as far as liberals of the new and classical variety are concerned, prosperity trickles up as much as down.

In regards to Reagan, what many either don't know or refuse to believe is that his administration's original tax cut plan did not include a single cut to the top rate. This irked Arthur Laffer and Robert Mundell - the fathers of supply-side economics. But the President believed that the public would not sufficiently support such a plan. However, the bill was actually amended by a Democrat to include the 70-50% top rate cut. So if anything, you should be calling Reagan a pioneer of "trickle-up" economics. Although all of these terms are stupid.

Myth status: destroyed.

It fucked over the middle and working class,

The facts tell a different story. Incomes have continued to go up, only slowing down since the second Bush Presidency. Mother Jones is not a source. This is from a CBO study:





From 1979 and 2010, the last year for which data are available, the bottom fifth's after-tax income in constant dollars rose by 49 percent.

Myth status: dismantled.

Why can't we have an America that is socially liberal, stops being silly about guns,

A true social liberal cares about personal liberty. The right to self-defense is fundamental to this.

[Lerodan Chinamerica]

Johnson could be perceived as a Keynesian. He cut the top tax rate from 90% to 70%, went to war and increased government spending enormously. But these were all done during economic expansion. If he were a Keynesian he would have done the opposite to prevent the economy from "overheating".

As someone who does not know much of LBJ or that period in American history, is it possible that he perceived an economic recession either at the time or coming up, and mistakenly/prematurely applied Keynesian policies with the intention of forestalling what he considered to be a downturn?

I doubt it. However, the Great Society stretched the Bretton Woods System to its breaking point, eventually leading to international economic collapse and stagflation. The warning signs began popping up in the mid-to-late-60s as more and more gold was flowing out of the US while the Fed printed more and more money to cover the budget deficit and the War in Vietnam. Johnson responded to the threat of collapse by partially rescinding the Kennedy Tax Cuts and imposing some price controls on foreign trade. So he was a bit of a demand-sider, but in regards to his overarching policy goals, his motivations were purely ideological.

[Atlanticatia]

enriched the topmost classes while impoverishing everyone else

This is patently false, and indicates massive intellectual dishonesty, and you should feel bad about that. I made this comparison below to show just how much better the economy was under Reagan than it is under Obama, but all the data there is relevant to this thread.



As you can see, annualised GDP per capita growth averaged 2.56% under Reagan. 20 million new jobs were created. The labour force was expanded by 3.8%. Median household income increased by 11.8%. Real disposable income increased by 33.5%. Real per capita income increased by 65%. The poverty rate was reduced from 15% to 12.8%. Real compensation grew by 11%.

So either you're lying to yourself, or you're horribly misinformed. I suspect it's a little bit of both.

That's a horribly biased and irrelevant chart. A 8 year period of (mostly) economic growth compared to a 5 year period around the time of the worst global financial crisis since the 1930s isn't really a fair comparison. Nor does it really say or show anything.
Also, under Reagan, the poverty rate actually increased. (It was 13% in 1980, and 13.1% in 1989.)

For example, I can say that things went very well under the days of JFK/LBJ - where everything was pretty much the antithesis to Reaganomics; higher tax rates, a lot of regulation and unionisation, and lots of new government programs.

Under JFK/LBJ (1961-69), average annualised GDP growth was 4.85%, reaching an all-time high under LBJ's second term, at 5.05%.
Under LBJ, real GDP per capita rose faster than under Reagan.
Not to mention, poverty fell by an unprecedented amount under Kennedy/LBJ, thanks to the War on Poverty.
Real median incomes rose more than under Reagan, too.

[Atlanticatia]

A true social liberal cares about personal liberty. The right to self-defense is fundamental to this.

Not really.
"Social liberalism is a political ideology with the belief that the right to freedom from coercion should include a societal foundation. Social liberalism seeks to balance individual liberty and social justice. Like classical liberalism, it endorses a market economy and the expansion of civil and political rights and liberties, but differs in that it believes the legitimate role of the government includes addressing economic and social issues such as poverty, health care and education. Under social liberalism, the good of the community is viewed as harmonious with the freedom of the individual."

There is a dividing line between a strain of more 'social libertarianism' (if that's a thing) and social liberalism. The collective good is seen as a qualifier for complete individual liberty. Firearm ownership is detrimental to the collective good, therefore complete individual liberty would be bad for the good of society. I'm not a libertarian. I believe that individual liberty and collectivism are both important, and all individuals should be free from coercion on their personal choices, as long as society isn't made worse off. Individual firearm ownership is fine, unless it gets to an extent that begins to harm the collective good - so, regulated firearm ownership is a socially liberal viewpoint. If there was no regulation of firearms, there would be maximum individual liberty and maximum freedom from coercion, however, there would be more gun deaths, impacting society and non-gun owners. Regulated firearm ownership allows for the maximum amount of personal liberty that doesn't hurt the collective society.

Social liberalism is mostly about cultural liberalism and social justice in economics, though.

[Lerodan Chinamerica]

This is however, mainly due to an increase in government spending (note that the Reagan Tax cuts actually increased revenues)

The high tax rates were mainly a way to keep middle class wages high, not necessarily to raise a lot of revenues. It is true that it was rare that people paid them.

How does taking money from people make them earn more money? Take a look at the history of the US's individual income tax rates. Look at income tax rates for 1980:



Middle class incomes - $50,000 to $100,000 - were taxed between 30% and 49%. Of course, their effective tax rates were much lower. But stealing someone's money and then giving a little bit back does not result in any net income gains.

This was because a rate of 70, 80, or 90% ensured that people on the top would pay their workers more instead of paying themselves excess incomes.

This would be a nice narrative if wages had stagnated. But they haven't.

Right now, we have a situation where the CEO of Walmart - our largest employer - is paid $35 million per year and his workers are paid $8 an hour. So, the CEO is earning more in an hour than his employees earn in a year. This is encouraged because why would the company not pay the CEO more if only 35-40% of it will be going to the federal government?

However, in the postwar era before Reaganomics - it was more like this. The largest employer in the US was GM, where the average worker earned around $50 an hour, including health and pension benefits. The CEO of GM earned about 30-40x this amount. The top tax rate was 91%, so company boards didn't have a reason to pay tens of millions of dollars a year. Why would companies pay executives exorbitant and unnecessary salaries for it to be taxed away, when they could spend that money on higher wages for employees, creating jobs, and investing?

That's why this happened. Before tax wages at the top rose exponentially. America was never soaking the rich for tax revenues - those top rates were rarely paid. However, there was less of the 'rich' to soak, and a larger middle class.

As I showed before, nobody ever paid 90% tax rates. In fact, the top effective income tax rate has stayed relatively constant since World War II.

As a result of Reaganomics, a gap began to form between wages and productivity

Cherry-picked data used to support a framed narrative. Real compensation grew by 11% under Reagan, and has only begun to stagnate under Obama. The worker productivity gap emerged around 2001-2.

and the top 1% took received more and more income. And remember - this is all pre-tax income. Nothing to do with redistribution or post-tax income.

Once again, this is a framed narrative. All that this means is that the wealthy are making more money faster than others. But everyone else has still been making more money. Why should I care if my neighbour is making more money than me when I'm getting richer too? Entering his home and taking his property isn't going to do anything except diminish incentives and create an economy of parasites and looters. I'll note that it's not the poor who are the looters. They are often the most opposed to tax increases as many of them believe that they will eventually rise into higher income levels. (There is a name for this economic concept, but it alludes me right now.) It is the bureaucrats who are the looters, and end up personally consuming much of this stolen wealth.

Everyone experienced income growth before Reaganomics and neoliberalism. However, the wealth never trickled down.

Once again, this is a lie. Incomes grow during economic expansion, as they did during the 1980s.

[Our Governator]

Carter tried to deregulate, whot?

Airline Deregulation Act - Carter administration

Depository Institutions Deregulation and Monetary Control Act - Carter administration

Motor Carrier Regulatory Reform and Modernization Act [trucking deregulation] - Carter administration

Staggers Rail Act [rail transport deregulation] - Carter administration

Natural Gas Policy Act [simplification of natural gas regulatorystructure] - Carter administration

And finally... the ever popular 'pro-small business' Regulatory Flexibility Act - Carter administration


From the above, it's reasonable to reach the conclusion that Carter tried to deregulate, and/or streamline regulation in, at least some sectors of the US economy.

He also asked how Obama is fiscally conservative, a claim I didn't make. But I can tell you he is much more conservative than we give him credit for being.

[Lerodan Chinamerica]

This is patently false, and indicates massive intellectual dishonesty, and you should feel bad about that. I made this comparison below to show just how much better the economy was under Reagan than it is under Obama, but all the data there is relevant to this thread.

(Image)

As you can see, annualised GDP per capita growth averaged 2.56% under Reagan. 20 million new jobs were created. The labour force was expanded by 3.8%. Median household income increased by 11.8%. Real disposable income increased by 33.5%. Real per capita income increased by 65%. The poverty rate was reduced from 15% to 12.8%. Real compensation grew by 11%.

So either you're lying to yourself, or you're horribly misinformed. I suspect it's a little bit of both.

That's a horribly biased and irrelevant chart. A 8 year period of (mostly) economic growth compared to a 5 year period around the time of the worst global financial crisis since the 1930s isn't really a fair comparison. Nor does it really say or show anything.

Irrelevant. I'm not talking about Obama. Incomes increased exponentially during the 1980s.

Also, under Reagan, the poverty rate actually increased. (It was 13% in 1980, and 13.1% in 1989.)

No.

.

For example, I can say that things went very well under the days of JFK/LBJ - where everything was pretty much the antithesis to Reaganomics; higher tax rates, a lot of regulation and unionisation, and lots of new government programs.

Under JFK/LBJ (1961-69), average annualised GDP growth was 4.85%, reaching an all-time high under LBJ's second term, at 5.05%.
Under LBJ, real GDP per capita rose faster than under Reagan. Real median incomes rose more than under Reagan, too.

You're nearly right there. The economy did better in the 60s than it did in the 80s in nearly all categories. But you're painting a misleading narrative. First of all, the big government policies pursued by Johnson had little to do with JFK. He did quite a bit of verbal advocacy for more government at first, but his concrete record is better. He kept entitlement spending flat and real spending did not increase by too much, and, possibly influenced by an IMF paper by Robert Mundell circulating at the time, embarked on strongly supply-side economic policies. He raised interest rates to attract foreign capital to the economy and cut business and personal income tax rates. This - what Mundell called the "policy mix" - is what sparked the 60s boom.



In regards to LBJ, the War on Poverty began in 1965, which coincided with a very noticeable economic slow-down.

Real GPP and GDP growth 1961-1969
1961 0.54 2.6
1962 7.98 6.1
1963 4.70 4.4
1964 6.05 5.8
1965 8.70 6.5
1966 5.93 6.6
1967 -0.41 2.7
1968 3.99 4.9
1969 3.69 3.1

As you can see, 1961-65 average annual GPP growth was 5.59%. For GDP, it was 5.08%. But for 1966-69, average annual GPP growth was 3.3% and for GDP it was 4.3%. (See what I mean? GDP is a good way of masking bad economic stats.) The increases in government spending and creation of new government programs happened late in the Kennedy Boom - and coincided with a recession and a significant fall in economic growth. This is no surprise to me, since economic growth correlates negatively with government spending.

So basically, Kennedy's supply-side policies sparked a strong economic expansion that was sadly hijacked by bad fiscal policies. And of course, I don't need to tell you that Johnson's reckless spending and cheap-credit policies caused the international monetary system to collapse in the early 70s, plunging much of the world into a decade of stagflation.

Also, the regulatory state didn't really get going until the Nixon Presidency.

Not to mention, poverty fell by an unprecedented amount under Kennedy/LBJ, thanks to the War on Poverty.

You think the War on Poverty has actually helped poor people?



You've already told me that means-testing has hurt the poor. This has been a direct result of the so-called War on Poverty. The Great Society programs have done nothing but incentivise unemployment and poverty - and you know this.

[Lerodan Chinamerica]

A true social liberal cares about personal liberty. The right to self-defense is fundamental to this.

Firearm ownership is detrimental to the collective good,

I used to hold this point of view. But it helps to do research. I did, and became the only British citizen to advocate total gun legalisation.

If there was no regulation of firearms, there would be maximum individual liberty and maximum freedom from coercion, however, there would be more gun deaths, impacting society and non-gun owners.

If this were true, then why was the US homicide rate in 1885, when the only gun regulations were those in the South that stopped blacks from owning firearms, less than 1 per 100,000 people, and 10 per 100,000 people in the aftermath of late 60s gun control laws? Excuse the biased annotations below, they're not mine.

[Lerodan Chinamerica]

Sources on the guns to homicides thing:

http://www.unodc.org/gsh/en/data.html
http://www.smallarmssurvey.org/publicat ... rbook.html
http://crimepreventionresearchcenter.or ... countries/
http://www.smallarmssurvey.org/fileadmi ... e-4-EN.pdf

[Kelinfort]

Firearm ownership is detrimental to the collective good,

I used to hold this point of view. But it helps to do research. I did, and became the only British citizen to advocate total gun legalisation.

If there was no regulation of firearms, there would be maximum individual liberty and maximum freedom from coercion, however, there would be more gun deaths, impacting society and non-gun owners.

If this were true, then why was the US homicide rate in 1885, when the only gun regulations were those in the South that stopped blacks from owning firearms, less than 1 per 100,000 people, and 10 per 100,000 people in the aftermath of late 60s gun control laws? Excuse the biased annotations below, they're not mine.

Why are we discussing gun control now?

[The New Sea Territory]

"Less regulation on businesses!"
Ooh, another good one.
Let's give businesses more freedom to abuse workers and create products that kill us.
How about we let them discriminate based on race, sexuality, etc. too?
I'm sure the Libertarians would like that one.

Uh, no we wouldn't like it, but why are you ranting about libertarians on a thread about conservatives? You do realize they are directly opposed to one another? The former supports social liberalism, free markets and minimal statism/anarchism, the other is an authoritarian, traditionalist, nationalist, corporatocratic bullshit excuse of an "ideology".

[The United Colonies of Earth]

"Less regulation on businesses!"
Ooh, another good one.
Let's give businesses more freedom to abuse workers and create products that kill us.
How about we let them discriminate based on race, sexuality, etc. too?
I'm sure the Libertarians would like that one.

Uh, no we wouldn't like it, but why are you ranting about libertarians on a thread about conservatives? You do realize they are directly opposed to one another? The former supports social liberalism, free markets and minimal statism/anarchism, the other is an authoritarian, traditionalist, nationalist, corporatocratic bullshit excuse of an "ideology".

I thought libertarians were okay with corporate takeovers.

[The New Sea Territory]

Uh, no we wouldn't like it, but why are you ranting about libertarians on a thread about conservatives? You do realize they are directly opposed to one another? The former supports social liberalism, free markets and minimal statism/anarchism, the other is an authoritarian, traditionalist, nationalist, corporatocratic bullshit excuse of an "ideology".

I thought libertarians were okay with corporate takeovers.

Define "corporate takeovers". There is a difference between a legitimate free market (separation of state and economics) and modern corporatocracy (state and corporation work together to screw over the middle and lower class).

[Kelinfort]

What is non monetary compensation?

Company-provided healthcare, cars, education or training, etc. Things like these may sound frivolous to you or I, but they account for 20% of average total compensation. Money wages and non-monetary compensation have continued to increase, which explains the dramatic advances in personal and household incomes in the last three decades.

Compensation stagnation has only begun to occur in the last five years, and the worker productivity gap has only appeared since 2001-2. I'd guess this has something to do with the Greenspan monetary expansion, but I'm just speculating.

Could this be accounted for by healthcare and education cost increases?

[Atlanticatia]

I thought libertarians were okay with corporate takeovers.

Define "corporate takeovers". There is a difference between a legitimate free market (separation of church and economics) and modern corporatocracy (state and corporation work together to screw over the middle and lower class).

what do you mean by separation of church and economics? i've never heard that term before

[The New Sea Territory]

Define "corporate takeovers". There is a difference between a legitimate free market (separation of church and economics) and modern corporatocracy (state and corporation work together to screw over the middle and lower class).

what do you mean by separation of church and economics? i've never heard that term before

State. Damnit. I'm worn out.

[Atlanticatia]

what do you mean by separation of church and economics? i've never heard that term before

State. Damnit. I'm worn out.

that's what i thought. lol

Anyway, why can't corporatocracy occur in the absence of the State? It's just as likely that corporate interests could act in the worst interests of the middle and lower class, whether they become too powerful without a State, or whether the State and the corporations become entrenched within one another.

[The New Sea Territory]

State. Damnit. I'm worn out.

that's what i thought. lol

Anyway, why can't corporatocracy occur in the absence of the State? It's just as likely that corporate interests could act in the worst interests of the middle and lower class, whether they become too powerful without a State, or whether the State and the corporations become entrenched within one another.

http://en.wikipedia.org/wiki/Corporatocracy

It's based on the existence of the state supporting and bailing out the corporate elite, the military-industrial complex and imperialism.