© 1999 Joe Murray

Today, we hear people proclaim the 20^th Century to be “America’s Century.” But, 20 years ago, prior to Ronald Reagan’s election, it looked to many that America’s best days were behind it. President Jimmy Carter was a good man, but was also a pessimist that thought the country was in a malaise, and he obviously didn’t have a clue of what to do. At home, the economy was falling into its worst recession since the 30's. Strangling the economy was double-digit inflation, double-digit interest rates and high tax rates. Americans reflected the pessimism of President Carter.

Abroad, it appeared that communism was the political tidal wave of the 20^th century and was going to sweep the world. Nation after nation either went communist or was moving in that direction. Things looked bleak when America elected Ronald Reagan as President. Fortunately, under Reagan’s leadership, America came out of the Carter malaise at home and turned the tide of history toward freedom with the fall of the Soviet Union.

Following the defeat of Hitler and Nazi Germany in World War II, the Soviet Union took control of all of Eastern Europe. In 1949, China, the nation with the world’s largest population, fell to communism. It was followed by many other countries over the next 30 years, despite the western nations’ (led by the United States) attempt to contain what became known as the domino effect in places like Greece, Korea, Cuba and Vietnam. The opponents of communism may have slowed the progress, but the direction of the world continued to shift to the left.

The United States and its allies, while fighting against communism, seemed resigned to the direction of history. Even former “communist turned enemy of communism,” Whittaker Chambers, said that by turning his back on communism, “he was leaving the winning side for the losing side.”

Just 20 years ago, nobody in leadership positions believed that Soviet Communism would collapse and the Berlin Wall would come tumbling down. The options advocated ranged from joining them, trying to create a kinder gentler communism or a policy of containment and appeasement. Just 10 years later, the Berlin Wall came tumbling down because Ronald Reagan had the courage to stand up and call the Soviet Union what it was, “An Evil Empire,” and that it was “destined for the dustbin of history.”

Reagan did more than just talk. He put his words into action. He rebuilt the U.S. military strength, stopped all further spread of communism throughout the world by supporting opposition efforts and even saw it start to be rolled back. These efforts reached a climax, after he left office, with the collapse of the Berlin Wall and the subsequent overthrow of all the communist governments in Eastern Europe.

Left and Right, the experts called Reagan crazy, simple minded and claimed his war-mongering rhetoric would bring on nuclear war that would destroy the world. Dinesh D’Souza, in his book called Ronald Reagan, How an Ordinary Man Became an Extraordinary Leader, describes Reagan’s accomplishments in the face of harsh criticism.

The man they called a lightweight turned out to have as deep an understanding of communism as Aleksandr Solzhenitsyn. He knew from the outset what its weakness was and that it could be defeated. This rank amateur developed a complex, often counterintuitive, strategy for dealing with the Soviet Union that hardly anyone on his staff fully endorsed or even understood.  And, he implemented it over the objections of hawks as well as doves. During his first term, he was tough with Moscow, and he faced harsh criticism from the doves.  During his second term, he was conciliatory with Gorbachev, and he endured strong opposition from the hawks.

In both cases, he was proved right. Throughout  a combination of vision, tenacity, patience, and improvisational skill, this implausible statesman produced what Henry Kissinger terms “the greatest diplomatic feat of the modern era.” (It should be noted that when running for President in 1976, Reagan was highly critical of the Detente’ policy that Kissinger had advocated while working for Nixon and Ford)

While some like Kissinger admit they were wrong, many of the people who looked down their noses at Reagan still refuse to admit they were wrong. They try to say that the collapse of communism was inevitable and was the culmination of policy followed by previous presidents. However, their own words and deeds during that time only serve to refute them, and the historic record clearly refutes this revisionist attempt to cover their rear ends. Ronald Reagan clearly turned the tide toward freedom. 

On the home front, his policies were treated with equal contempt. Nevertheless, they worked to restore American confidence, economic prosperity and a renewed faith that the strength of the country comes from individuals -- not some government program. It didn’t come easy.  Congress was controlled by the Democrat Party, who fought him every step of the way. It also took two years for the economy to start turning around, which caused short-term unpopularity among the people.

Reagan would be the first to give the primary credit to the people of the country who returned to an entrepreneurial spirit fueled by the technological breakthroughs led by the personal computer. However, many business leaders give Reagan much credit for inspiring people to live the dream of starting their own companies.  He did so with statements like this: “The explorers of the modern era are the entrepreneurs. Men with vision: with courage to take risks, and faith enough to brave the unknown.”

Beyond inspiration, he promoted them to the country like no political leader had in many years. “Too often, entrepreneurs are forgotten heroes. We rarely hear about them. But look into the heart of America, and you’ll see them. They’re the owners of that store down the street, the faithful who support our churches, schools, and communities, the brave people everywhere who produce our goods, feed a hungry world, and keep our homes and families warm while they invest in the future to build a better America.” 

As to direct policy changes that helped create 92 months of economic growth for all segments of society (from the richest to the poorest), the key was a 25% across-the-board tax cut. Top marginal rates were reduced from 70% to 28%. Eventually, the tax code was simplified to have only two tax brackets -- the 28% level and the 15 % level. Despite the tax cuts, total revenue doubled during his presidency from $517 billion to $1.031 trillion. Income tax receipts increased 58%. Reagan summed up the reason for the success. “Common sense told us that when you put a big tax on something, the people will produce less of it. So, we cut the people’s tax rates, and the people produced more than ever before.”

The other major factor for restoring economic growth was reducing inflation and interest rates by advocating a restrictive monetary policy. This was achieved with the help of Federal Reserve chairmen Paul Volcker and Allen Greenspan. William Niskanen and Stephen More of the Cato Institute summarize what happened to inflation. “The central economic evil that Ronald Reagan inherited in 1981 from Jimmy Carter was three years of double-digit inflation. In 1980, the consumer price index (CPI) rose to 13.5 percent. By Reagan’s second year in office, the inflation rate fell by more than half to 6.2 percent. In 1988, Reagan’s last year in office, the CPI had fallen to 4.1 percent.” Interest rates also fell dramatically during his term in office. By the time he left office, most rates were at least half of what they were when he took office, and some were even lower. Thus, the steady supply of money gave confidence to investors and consumers alike to further strengthen the economic recovery.

The goals Ronald Reagan was unable to achieve were: balanced budgets and a reduction in national debt. The reasons for this failure were twofold.

First, he was unable to do this because of the large increases in military spending, which I, for one, think was justified because of the great service it did the world.  It gave freedom to millions of oppressed people.  From 1981 to 1989, the Pentagon budget doubled from $158 billion to $304 billion.

Both Bill Clinton and the current Republican congress want to take credit for the balanced budgets of last year and this year. They deserve a little credit for showing some fiscal restraint, but the primary reasons for the budget surplus is the peace dividend of the collapse of the Soviet Union.  It made them feel they could slash the defense budget. The second reason is the strong economy. The policies that caused both of these to happen are those implemented by Ronald Reagan over a decade ago. Stephen More says:

The historical irony is that the person most responsible for deficit reduction gets very little attention in the national media. The president who deserves the most credit for the balanced budget we are now witnessing is not Bill Clinton. And, the Republican who deserves the most credit is not Newt Gingrich. Rather the politician whose long-run policies are most responsible for leading us to a balanced budget is Ronald Reagan.

The primary reason Ronald Reagan wasn’t able to balance the budget is because he had to live, the whole time he was president, with the Democrat Party in control of the U.S. House of Representatives. Reagan never sent a balanced budget, but his budget was always declared dead on arrival.  In 7 of his 8 years in office, the Democrats spent more than he recommended. As mentioned earlier, his tax cuts actually worked to increase revenue. He also was able to do better than those who came immediately before and after him on slowing the growth of domestic spending, which only increased 5.8% under Reagan. From 1973-1981, domestic spending had increased 52%. From 1989 through 1996, it had increased 28% and has increased by a great deal more in the last 3 years.  Overall, actual budget outlays were 24.5% more than he requested. By his last year in office, that would have seen a budget $280 billion less than what was actually spent. That would have given a budget surplus of $130 billion.

Reagan was committed and did the best that political reality would allow to reduce taxes, regulations and the overall size of government while having a strong military to defend our national interests. Clearly, Ronald Reagan’s presidency is one of the most successful in the history of the country -- on all fronts. It is no surprise his natural enemies in the Democratic Party keep trying to discredit him, but it is dismaying and bad for the country when the people who elected him and shared his vision for the country reject the principles and forget the example for political success that he set.

The big enemy of limited government and freedom at home remains the Democrat Party. Republicans have made their share of mistakes in the 10 years since Reagan’s term in office ended, but it has been primarily a reaction to the attacks and lies of the Democrat Party that swung public opinion against them. Democrats have stayed loyal to their party and its desire to ever expand government, not withstanding Bill Clinton claiming the era of big government was over. Bill Clinton lies, and he commits adultery, perjury and obstruction of justice. He takes illegal foreign campaign contributions from the Chinese, who just happened to be our biggest potential enemy in the world right now. The list is endless of things that shouldn’t be tolerated by anyone, regardless of political affiliation.  But, the Democrats still stick together.

What do Republicans, conservatives and libertarians do in the post Reagan era? They tear each other apart by blaming their allies rather than going after the real enemy. They either stay home and don’t vote on election day, bolt to a third party, or whine and snivel about the Republican Party leadership without doing anything to get the leaders in line or become leaders themselves. The results have nearly destroyed a wonderful opportunity to really turn the tide away from big government in this country – a tide that Ronald Reagan had begun.

The political reality is that the people elect politicians. The majority of people are receptive to smaller government, want lower taxes and fewer regulations for themselves.  But, at the same time, they still believe that they are entitled to handouts from the government as long as they can benefit from them. Thus, it still is an uphill battle to change people’s minds and gain the support necessary to actually start dismantling big government.

It takes more than good ideas to change the political process. It takes leadership, organization, money and power. Ronald Reagan had great ideas that changed the tide of history and made freedom and personal responsibility popular again.  He also understood the need for power at home as well as abroad. That didn’t come from abandoning his political party like he was urged to do in both 1968 and 1976. Instead, he gained control of the Republican Party and it gave him the money, organization and support necessary to become president and allowed him to put many of his great ideas into practice. That’s more than can be said for the entire combined membership of the Reform, Libertarian, Constitution, Natural Law, Socialist, Communist or any other American fringe party. I respect many of the ideas and people in some of these parties, but the best chance for a strong, prosperous and free nation is to elect a republican as president in 2000, along with a stronger republican majority in both houses of congress.

To Joe's previous article