Wednesday, September 12, 2012
President Ronald Reagan has become the patron saint of political Republicans, an inspiration and a model for their few glory days since Abraham Lincoln. He has a lesson for the Romney/ Ryan ticket, a lesson that contradicts the low budget and reduced public services advocated by the Republicans. Facing a severe decline in business activity and employment, Reagan horrified his advisors by raising government spending massively, more than his Democratic predecessor did. He stimulated the US economy and led the West in the Cold War. George Gilder, a key Reagan advisor and a Founding Fellow of the Discovery Institute, reminds us that the Reagan tax rate cuts and other pro- enterprise policies added some $17 trillion(yes, trillions) to America's private sector assets, dwarfing all prior deficits in creating 45 million net new jobs at rising wages and salaries. Ultimately the Reagan boom would raise private sector assets by another $60 trillion over 20 years. The Romney/ Ryan ticket is missing a rare opportunity to follow the Reagan spending initiatives to reverse the current crippling trends. Saving Social Security and Medicare is an opportunity for keeping seniors and workers healthy and happy, and in the work force rather than driving them out. However, Romney and Ryan are going in the opposite direction, cutting the federal budget in order to cut taxes and government expenditures. If Romney and Ryan win election and choose to pursue this path in response to pressures from crony capitalists and ideological conservatives, they will not galvanize another Reagan American Century and industrial boom. Strange as it may seem, the real Reagan lesson will be implemented by the Liberal Democratic Obama regime. They know how to implement the Reagan spending policies that followed the Franklin Roosevelt policies to spend large public money to create jobs for most Americans, improving the American infrastructure, often by increasing taxes paid by the wealth of savers, favored governments and crony capitalists. Departing from the Reagan policy is likely to extend the bad times costing Romney/ Ryan the election. The Democrats have a rare opportunity to spend and spend, elect and elect, in the spirit of Ronald Reagan.
Posted by Jerome Grossman at 6:53 AM