Happy 100th President Reagan!

Ronald Reagan:  A Defense and a Criticism

Ronald Reagan was the greatest president of the 20th Century.  He recaptured America's glory and global respect after the ham-handed buffoonery of the Carter years.  Yeah, FDR must be considered great for his fireside chats and WW II leadership, but his statist economic policies increased the country's misery.  Reagan, on the other hand, knew how to jump start an economy left for dead by liberal experimentation.

Nonetheless, liberal gargoyles like Paul Krugman love to blame all our ills on Reagan, the man responsible for the longest economic boom in our nation's history.  He was not perfect, but on balance, Reagan was a great president, but more importantly, he was a great man of rock-solid values who knew why he believed what he believed.  Here I offer a summary of Reagan criticism (some legitimate), and some links that defend his policies.


Paul Krugman is a dishonest, diabolical troll
Instead of using his education to enlighten Americans about the difficult and dismal science of economics, he chops up facts like firewood and serves up selectively sliced statistics in order to score cheap political points in an attempt to smear this great president.  Ignorant liberals lap it all up and regurgitate it on the rest of us, forcing us to do the homework lazy liberals just won't do.

Practitioners like Krugman use little funhouse mirror tricks to stretch and distort our view.  Yes, some conservatives do it too, but I don't listen to them or repeat their BS.

Most liberal writing on our economic mess is a hopeless tangle.  A typical writer will take crony capitalism, spending, deregulation, bubbles, and poverty, wad it all in a big ball and throw it in Ronald Reagan's face.  The logic is terrible and typically lacks cause and effect. 

Tis true, Reagan didn't shrink the government and he grew the national debt
In return, we collapsed the Soviet Union, freeing tens of millions of Eastern Europeans and got a well-respected kick-ass military to boot.

Add to that the regulatory reform that allowed millions of Americans to start their own businesses and brought structural unemployment to below 5%.  The result was the longest economic expansion in American history, thanks to President Clinton continuing Reagan's policies. What have we gotten for the trillions Obama has spent?  At least Reagan's spending produced results.

For a serious libertarian criticism of Reagan, see free-marketer Sheldon L. Richmon's article, or Murray Rothbard's excellent critique, The Myths of Reaganomics. Their main criticism is he did not roll back government and he spend too much.  These are not liberal screeds, but rather cold-eyed analyses of the facts devoid of any personal criticism of the man.

Reagan was a great man and a great president.  If you want to defend him, you must consider his record, warts and all (no one in the public arena is wart-free).  He did the best he could in an America remade by progressives.  FDR build a clanking, soul-destroying bureaucratic machine, and even the great Ronald Reagan couldn't dismantle it. 

The only way progressives can defend Obamanomics is to turn it all upside down, and that involves taking the success that is Reaganomics and convincing enough soft-headed people that the longest economic expansion in our history was really a failure.

For a serious defense of Reaganism, see the following articles.  There's a lot of liberal BS out there, you'll need to refer to them often:

Reaganomics - William N. Niskanen
Thomas Firey - There Krugman Goes Again
Max Barron - Chief Lib Propagandist Krugman
Reagan Did What? Fantasies of Paul Krugman
Donald Luskin - That Old Hack Magic
Robert Scheer - Krugman Ignores the Real Culprits
Stefan Karlsson
Nick Gillespie - Blame Reagan!
Krugman - Enron's Nobel Advisor

GOP Destroyed America!

Republicans stand guilty of collaboration with progressives

Market Watch's Paul Farrell has written a scathing critique of Republicans, entitled GOP Destroyed the US Economy, where he comments on Reagan OMB Director David Stockman's stinging rebuke of Republican economic policy.

I'm particularly attuned to Reagan criticism, since I combat so much of it in Left Blogistan.  Lefty critiques are incoherent babble, easily refuted, but the libertarian thrusts draw blood.  Farrell and Stockman, though not libertarians, nonetheless deploy classic Rothbardian arguments (excepting their advocacy for higher taxes and protectionism).

Here Are the Four Republican Sins that Set Us on the Road to Perdition

• Nixon reneging on the Bretton Woods agreement and completely decoupling the US dollar from the price of gold.  The precipitous decline of our dollar is the result
• Crushing debts, from domestic pork and overseas adventures
• Corporate welfare for Wall Street
• Addiction to cheap crap and easy money has hollowed out our economy

We are a Progressive Nation
All I can say in defense of Republicans is they worked with what they had.  Give a sculptor a pile of dung, and she can sculpt something with it.  It won't come out as beautiful as her work in clay...

Progressives built a doomsday device.  Try to dismantle it and it will explode, destroying our nation and society.  You can't starve the beast without starving granny.

But this excuse won't fly anymore.  If the GOP gets power back, they had better use it to shatter the existing system, or we are done for.

Free Markets, Free People:  Let's try it here in America
We have been suffering under the fallacy that there is not downside to government programs.  Austrian School libertarian Kel Kelly provides some guidance:

in a free market, we would not need government "protection" because we would be protected by tough competition in the marketplace. If one company tried to underpay or overcharge us, there would be many more companies we could turn to that were offering higher wages and lower prices (i.e., market wages and prices) in order to attract us.

Companies would therefore find ways to produce with lower costs, a goal they could more easily accomplish with more capital available to them. The more capital they employed and the greater workers' corresponding productivity, the higher the market wages.

Stop the Printing Presses!

And without the government's manipulation of interest rates and the printing of money, there would be no wide-scale malinvestment, and therefore no recessions and financial crises. In this case, prices would fall instead of rise most years, and our lives would generally improve through time.

You could also save your money in a safe, low interest bank account and not have it nibbled away by inflation, thereby being able to support yourself in your old age.


Failure:  Businesses go broke - Government grows bigger

No central planner can determine what is best for each of us individually or in the aggregate. The economy works only though individual decisions and choices.
No politician can help companies produce more efficiently or in a way that better pleases consumers. By using market prices and rates of profit, businesses generally best determine what we individuals want for our lives. If they judge correctly and produce what we need and desire, they succeed; if they don't, they die.

Government, on the other hand, dictates what it wants us to have, and has no system of profit and loss to determine whether it is succeeding in pleasing its "customers," or whether it is producing or destroying wealth in the process. Since it can't determine its success or failure in money terms, it is necessarily always destroying wealth on a net basis. And since government is a monopoly, it does not allow competitors for us to turn to.

Is government doing a "good job?"

The only real test of whether a "good job" is done is whether or not it has become easier for people — all people — to achieve an increased living standard from one year to the next, given the same amount of labor hours performed.

Excerpts from Mises.org: Kel Kelly - Can Politicians Help Us?

Reagan vs. Obama (It's no contest)

Yes, the Great Recession started under President Bush, but economic uncertainty under President Obama continually gives it new life. Meanwhile, economic ignorance fuels progressive rage against the machine

Frank J. Donatelli provides a comparison that pushes back against progressive ignorance

He (Obama) has said that he inherited the worst recession since the Great Depression. He didn’t. The economies inherited by both President Gerald Ford in 1974 and Reagan in 1981 were far worse.

Obama has said the stimulus has saved 3 million jobs. It hasn’t. We have nearly that many fewer jobs than before the stimulus was passed in February 2009, and the unemployment rate is 1½ percentage points higher than what he claimed would be the high point once his program was enacted.

Obama has said he is doing all he can to revive the economy. Actually, he’s doing too much. The economic uncertainty that his “historic” health care and budget bills have created is doing more to hold back economic growth than anything else. Companies are hoarding cash rather than invest in Obama’s uncertain economic climate.

As a result, the recovery is anemic by historic standards.

So we have two historic presidents. Both inherited bad economies. One cut spending and taxes, and then, 17 months later, the economy boomed. The other increased taxes and spending. It’s now 17 months later.

Mr. President, we’re waiting.

Further Reading
Obama, Reagan, and the Economy
Peter Ferrara - Timeless Principles of Prosperity

Weekend Wrap-Up

Steve Forbes cuts to the heart of the statism of Obama and the Pelosicrats
I have done it myself, but I don't think calling people fascists helps the cause of freedom.  Steve Forbes gives us a model of how to argue against the liberty grab that is going on:

One hesitates to bring up the economics of Benito Mussolini and his ilk because fascism means ugly nationalism and racism, as well as mass murder and aggressive war. So let's label the economic part of that ideology as neosocialist, corporatist, statist or--to be sophisticated and use a French word--dirigiste.

Under the corporatist state, private companies exist but take their direction from government. Competition is seen as wasteful and destructive and therefore must be "managed." There is a basic hostility toward small businesses precisely because there are so many of them, making them harder to regulate and more apt to do things without government permission.

Statism certainly creates a facade of stability...

Next Up T.R. Fehrenbach explains how business is undermined by greedy politicians:

The majority of Americans work and therefore eat and pay taxes because they are involved in some sort of surplus-producing private business, from industry to sales to finance to science and agriculture. Enterprises such as charities, education, and government — non-profits in general — are utterly dependent on profit-making business for funding. You'd think people would grasp this when things get rough.

We are dependent on business, not government, to create wealth

There are many reasons for this. Business is always being undermined by the demons inherent in democracy: greedy politicians and populist programs that gut it. By and large, educators and clergy, who create no wealth, put other callings first.

Bright people are urged not to go into business and make money but to serve their fellow man. The problem is, nobody can serve anybody without the wherewithal. Many people who live off donations and taxes affect to despise the source, much in the manner that clean-handed lords despised their grubbing serfs.

Required Reading:  George Will's Cato Institute Speech
It is too brilliant to excerpt here.  Go read the whole thing

Peter Ferrara offers a quick economic history of the 20th Century.  
He explains how supply-side, pro-growth policies worked not Just for Reagan, but for Kennedy and Harding as well.  Read it, understand it, bookmark it.  This is essential information for those of us who routinely argue with delusional liberals who claim Reagan wrecked the economy.