If there’s one thing as certain as death and taxes it is that every election year (and any other time they think they can work this in) conservatives will bring up the good ol’ days of Ronald Reagan. So I thought I would take a walk down memory lane and revisit some of the points they make.
You think taxes are too high? That they are the highest in American history?
Well, they certainly are not the highest in history. And many conservatives like to recall the wonderful world of life under President Dwight D. Eisenhower — so you probably think tax rates were near 0 then. But they weren’t. The highest earners paid — and hold on to your hat — 91 percent of their income in taxes.
Back to President Reagan.
When Reagan took office, the tax rate for the wealthiest among us was 50 percent. They stayed there for the first six years of his tenure in the White House. He lowered them to 38.5 percent in 1987 and then to 28 percent in 1988. That means for seven of his eight years as president, the richest Americans paid less taxes than under President Obama.
But while the tax cuts are what the right crows about, he raised them, too. In 1982, he raised business taxes, in 1983, payroll taxes went up (these have an impact on ALL wage earners), and in 1984, energy taxes went up.
Now, who remembers the 1990s? I do. From what I remember, life was pretty good. The economy did very well and President Clinton’s tax rate for the richest Americans? It was 39.5 percent. This rate now is 35 percent. You can get all this info here.
(Question for the class: if lowering taxes creates jobs, where are they?)
“I don’t worry about the deficit, it is big enough to take care of itself.” — President Ronald Reagan.
That comment may have been made in jest but if you look at his policies, you might think Reagan meant it because it grew during his presidency. In fact, it was lower under President Carter. Under Carter it was 2.5 percent of the GDP. Under Reagan it fluctuated from 4.2 percent to 6 percent. And think about that for a moment. If the economy IMPROVED under Reagan, the GDP grew meaning deficits went up in actual dollars a LOT.
It took getting a Democrat back into the White House (thank you, President Clinton) to balance the budget to the point where we even had surpluses by the end of his two terms.
My last thought on this is that we became a debtor nation for the first time under President Reagan.
Don’t believe me about any of this? Check this out.