Ronald Reagan's Legacy Clouds Tax Record
STEVE INSKEEP, host:
The country is remembering Ronald Reagan's legacy this week as we approach the 100th anniversary of his birth. The late president still casts a long shadow over the political debate. In some cases that shadow obscures what Reagan actually did while president. NPR's Scott Horsley reports on one example.
SCOTT HORSLEY: A grudging admirer of Ronald Reagan's, Barack Obama, says one of the late president's legacies is that the middle class tax revolt is now a permanent fixture of American politics.
Grover Norquist, who heads a group called Americans for Tax Reform, warned Mr. Obama's fiscal commission last summer - when it comes to cutting the federal debt, higher taxes are not the answer.
Mr. GROVER NORQUIST (Americans for Tax Reform): We're spending too much, not taxing too little. It can be turned around. It was, in fact, when Reagan cut taxes. Tax hikes are what politicians do when they don't have the determination or the competence to govern.
HORSLEY: Reagan famously did cut taxes, sharply, in his first year in office. But as former Senator Alan Simpson, who co-chaired the fiscal commission, was quick to remind Norquist, that's only half the story.
Former Senator ALAN SIMPSON (Republican, Wyoming): Ronald Reagan raised taxes 11 times in his administration. I was here. I was here. I knew him. Better than anybody in this room. He was a dear friend and a total realist as to politics.
HORSLEY: Simpson's recollection is spot on, says historian Douglas Brinkley, the editor of Reagan's diaries.
Professor DOUGLAS BRINKLEY (Rice University): Ronald Reagan was never afraid to raise taxes. He knew that it was necessary at times. And so there's a false mythology out there about Reagan as this conservative president who came in and just cut taxes and trimmed federal spending in a dramatic way. It didn't happen that way. It's false.
HORSLEY: Reagan's budget director, David Stockman, explains the 1981 tax cut blew a much bigger hole in the federal budget than expected. So over the next few years, Reagan agreed to raise taxes again and again, ultimately undoing about half the savings of the '81 cut.
Mr. DAVID STOCKMAN (Former Director, Office Management and Budget): He wasn't very happy about it. He did it reluctantly. But at the end of the day, the math was overwhelming.
FLINTOFF: That's because Reagan was never able to match his 1981 tax cuts with a comparable cut in federal spending. A modest reduction in domestic spending was dwarfed by Reagan's big buildup in the Pentagon budget. And, Stockman says, Reagan never made a serious effort to challenge middle class entitlement programs, after an early proposal to curtail Social Security benefits was shot down.
Mr. STOCKMAN: The White House and President Reagan himself retreated within three days when it became clear the enormous political resistance that would occur if you were going to cut entitlements.
FLINTOFF: And without big spending cuts, Reagan faced a choice between raising taxes and an even bigger federal debt. He chose the tax hikes. Today the federal debt's bigger than ever, and policymakers are again staring at painful choices. President Obama's fiscal commission says both deep spending cuts and tax increases will be needed to bring the budget under control. But ever since Reagan, presidents who've tried to raise taxes are confronted with the myth of their tax-cutting predecessor.
What puzzles historian Brinkley is how Reagan, who also raised taxes, avoided paying a political price.
Prof. BRINKLEY: He seemed to get away with both. He seemed to really be kind of a centrist, big government deficit spender, but also be seen as a budget cutter. And it's because his persona was so great.
FLINTOFF: That persona is carefully cultivated by those, like Grover Norquist, who use Reagan's legacy as a weapon to fight off new taxes. Stockman says these myth-makers are distorting the real Reagan record.
Mr. STOCKMAN: I wouldn't call it merely airbrushing. I would call it outright revisionism if not fabrication of history.
HORSLEY: Stockman still believes tax cuts are good policy in some circumstances. But for too many politicians, he says, they've become a kind of religion. To these tax-cutting faithful, Ronald Reagan is a patron saint. Like many saints, his real story is not as pristine as the legend. But for those worried about today's red ink, it may be a more practical guide.
Scott Horsley, NPR news, Washington.
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