Sign Me Up: Why I Support “The Ronald Reagan Tax Reform Act of 2011”
Ten years ago today, the wealthiest Americans caught a multi-billion dollar break from their benefactor, then-president George W. Bush. In the decade since, through two wars, natural disasters, a plummeting economy and a soaring debt, the wealthiest Americans have gotten to keep those Bush tax cuts. Happy birthday, everybody!
As the Republican Party now lines itself up behind Rep. Paul Ryan on his mission to cut the resulting deficit on the backs of working people and the elderly, I find myself surprisingly and strangely nostalgic for another GOP hero, whose legacy, at least when it comes to taxes, has become woefully misunderstood. Can it be that I find myself nostalgic for Ronald Reagan?!
Of course, I’m not alone in my nostalgia. I’m joined by the entire Republican leadership in this, but I think our reasons may be quite a bit different. In the spirit of unity, I’d like to suggest to Republicans in Congress that they look closely at the record of their favorite 20th century hero and adopt yet another policy named after the Gipper. I’m no fan of much of President Reagan’s legacy, but in a new spirit of bipartisanship, and historical accuracy, I’d like to present Republicans in Congress with an idea: the Ronald Reagan Tax Reform Act of 2011.
A key element of the Reagan lore believed by today’s GOP is that Reagan’s embrace of “trickle-down economics” is what caused any and all economic growth since the 1980s. In fact, after Reagan implemented his initial tax-slashing plan in 1981, the federal budget deficit started to rapidly balloon. Reagan and his economic advisers were forced to scramble and raised corporate taxes to calm the deficit expansion and stop the economy from spiraling downward. Between 1982 and 1984, Reagan implemented four tax hikes. In 1986, his Tax Reform Act imposed the largest corporate tax increase in U.S. history. The GDP growth and higher tax revenues enjoyed in the later years of the Reagan presidency were in part because of his willingness to compromise on his early supply-side idolatry.
The corporate tax increases that Reagan implemented — under the more palatable guise of “tax reform” — bear another lesson for Republicans. The vast majority of the current Republican Congress has signed on to a pledge peddled by anti-tax purist Grover Norquist, which beholds them to not raise any income taxes by any amount under any circumstances, or to bring in new revenue by closing loopholes. This pledge, which Rep. Ryan’s budget loyally adheres to, in effect freezes tax policy in time — preserving not only Bush’s massive and supposedly temporary tax cuts for the wealthiest Americans, but also a vast mishmash of tax breaks and loopholes for specific industries won by well-funded lobbyists.
The problem has become so great that many giant American corporations have become so adept at exploiting loopholes in the tax code that they paid no federal income taxes at all last year — if Republicans in Congress follow their pledge to Norquist, they won’t be able to close a single one of the loopholes that are allowing corporations to avoid paying their fair share.
Even Reagan recognized the difference between just plain raising taxes and simplifying the tax code to cut out loopholes that subsidize corporations. In 1984, he arranged to bring in $50 billion over three years, mainly by closing these loopholes. His 1986 reform act not only included $120 billion in tax hikes for corporations over five years, it also closed $300 billion worth of corporate loopholes.
These kinds of tax simplification solutions are available for Congress if they want them. As I wrote in April, nixing Bush’s tax cut’s for the wealthiest Americans would help the country cut roughly $65 billion off the deficit in this year alone. Closing loopholes that allow corporations to shelter their income in foreign banks would bring in $6.9 billion. Eliminating the massive tax breaks now enjoyed by oil and gas companies would yield $2.6 billion to help pay the nation’s bills.
But before Republicans in Congress change their math, they have to change their rhetoric — and embrace the reality of the economic situation they face and the one that they’d like to think they’re copying. In 1986, during the signing ceremony for the Tax Reform Act, Reagan explained that “vanishing loopholes and a minimum tax will mean that everybody and every corporation pay their fair share.”
It’s time for the GOP to take a page from their hero’s playbook. If they do so, they might be able to find some allies that they never thought possible. It’s time for “everybody and every corporation to pay their fair share.” We can all get along. Sign me up for “The Reagan Tax Reform Act of 2011.”
By: Michael B. Keegan, President: People For the American Way, Published in HuffPost, August 7, 2011
The New Party Of Reagan: The Gipper Is Winning One For The Democrats
After he switched to the Republican Party in 1962, Ronald Reagan famously quipped: “I didn’t leave the Democratic Party. The party left me.”
Now, the Republican Party is doing the same thing to him — and Democrats are happy to take Reagan back.
At Tuesday morning’s meeting of the House Democrats, caucus chairman John Larson rallied his colleagues for the day’s debt-limit debate by playing an audio recording of the 40th president.
“Congress consistently brings the government to the edge of default before facing its responsibility,” Reagan says in the clip. “This brinkmanship threatens the holders of government bonds and those who rely on Social Security and veterans benefits. Interest rates would skyrocket, instability would occur in financial markets, and the federal deficit would soar. The United States has a special responsibility to itself and the world to meet its obligations.”
“Kind of sums things up,” Larson said, playing the same clip again at a news conference.
Nobody knows what Reagan, who died in 2004, would make of the current fight over the debt limit. But 100 years after Reagan’s birth, it’s clear that the Tea Party Republicans have little regard for the policies of the president they claim to venerate.
Tea Party Republicans call a vote to raise the debt ceiling a threat to their very existence; Reagan presided over 18 increases in the debt ceiling during his presidency.
Tea Party Republicans say they would sooner default on the national debt than raise taxes; Reagan agreed to raise taxes 11 times.
Tea Party Republicans, in “cut, cap and balance” legislation on the House floor Tuesday, voted to cut government spending permanently to 18 percent of gross domestic product; under Reagan, spending was as high as 23.5 percent and never below 21.3 percent of GDP.
That same legislation would take federal spending down to a level last seen in 1966, before Medicare was fully up and running; Reagan in 1988 signed a major expansion of Medicare.
Under the Tea Party Republicans’ spending cap, Reagan’s military buildup, often credited with winning the Cold War, would have been impossible.
No wonder Democrats on Tuesday were claiming the Republican icon as one of their own. After the caucus meeting with the Reagan clip, Rep. Mike Quigley (D-Ill.) began the day’s debate by reading from a 1983 Reagan letter to Congress warning that “the full consequences of a default — or even the serious prospect of default — by the United States are impossible to predict and awesome to contemplate.”
“In the year of his 100th birthday, the Great Communicator might be amazed at how far his own image has shifted from the original,” Quigley charged. “He’d see his most dedicated followers using his name as justification for saying no to honoring our debts. He’d see his legacy used to play chicken with the world’s greatest economic engine.”
Republicans have continued their ritual praise of Reagan during the debt-limit fight. Rep. Trent Franks (Ariz.) claimed that the budget caps would allow America to be “that great city on a hill that Ronald Reagan spoke of.” Marsha Blackburn (Tenn.) invoked Reagan’s belief that “the closest thing to eternal life on Earth is a federal government program.”Kevin Brady (Tex.) cited Reagan’s line that “the nine most terrifying words in the English language are ‘I’m from the government and I’m here to help.’ ” Both Steve King (Iowa) and Bobby Schilling (Ill.) informed the body that they had granddaughters named Reagan.
But while Reagan nostalgia endures, a number of Republicans have begun to admit the obvious: The Gipper would no longer be welcome on the GOP team. Most recently, Rep. Duncan Hunter Jr. (Calif.) called Reagan a “moderate former liberal . . . who would never be elected today in my opinion.” This spring, Mike Huckabee judged that “Ronald Reagan would have a very difficult, if not impossible time being nominated in this atmosphere,” pointing out that Reagan “raises taxes as governor, he made deals with Democrats, he compromised on things in order to move the ball down the field.”
During the debt-limit debate, a procession of Democrats — Vermont’s Peter Welch, Maryland’s Chris Van Hollen, New York’s Paul Tonko, Texas’s Sheila Jackson Lee and Gene Green — claimed Reagan’s support for their position. Reagan is “revered by many Democrats,” said Welch, who praised Reagan for fighting “the absurd notion that America had an option when it came to paying our bills.”
Half a century after he left the party, the Gipper is winning one for the Democrats.
By: Dana Milbank, Opinion Writer, The Washington Post, July 19, 2011
Why I Support “The Ronald Reagan Tax Reform Act of 2011”
Ten years ago today, the wealthiest Americans caught a multi-billion dollar break from their benefactor, then-president George W. Bush. In the decade since, through two wars, natural disasters, a plummeting economy and a soaring debt, the wealthiest Americans have gotten to keep those Bush tax cuts. Happy birthday, everybody!
As the Republican Party now lines itself up behind Rep. Paul Ryan on his mission to cut the resulting deficit on the backs of working people and the elderly, I find myself surprisingly and strangely nostalgic for another GOP hero, whose legacy, at least when it comes to taxes, has become woefully misunderstood. Can it be that I find myself nostalgic for Ronald Reagan?!
Of course, I’m not alone in my nostalgia. I’m joined by the entire Republican leadership in this, but I think our reasons may be quite a bit different. In the spirit of unity, I’d like to suggest to Republicans in Congress that they look closely at the record of their favorite 20th century hero and adopt yet another policy named after the Gipper. I’m no fan of much of President Reagan’s legacy, but in a new spirit of bipartisanship, and historical accuracy, I’d like to present Republicans in Congress with an idea: the Ronald Reagan Tax Reform Act of 2011.
A key element of the Reagan lore believed by today’s GOP is that Reagan’s embrace of “trickle-down economics” is what caused any and all economic growth since the 1980s. In fact, after Reagan implemented his initial tax-slashing plan in 1981, the federal budget deficit started to rapidly balloon. Reagan and his economic advisers were forced to scramble and raised corporate taxes to calm the deficit expansion and stop the economy from spiraling downward. Between 1982 and 1984, Reagan implemented four tax hikes. In 1986, his Tax Reform Act imposed the largest corporate tax increase in U.S. history. The GDP growth and higher tax revenues enjoyed in the later years of the Reagan presidency were in part because of his willingness to compromise on his early supply-side idolatry.
The corporate tax increases that Reagan implemented — under the more palatable guise of “tax reform” — bear another lesson for Republicans. The vast majority of the current Republican Congress has signed on to a pledge peddled by anti-tax purist Grover Norquist, which beholds them to not raise any income taxes by any amount under any circumstances, or to bring in new revenue by closing loopholes. This pledge, which Rep. Ryan’s budget loyally adheres to, in effect freezes tax policy in time — preserving not only Bush’s massive and supposedly temporary tax cuts for the wealthiest Americans, but also a vast mishmash of tax breaks and loopholes for specific industries won by well-funded lobbyists.
The problem has become so great that many giant American corporations have become so adept at exploiting loopholes in the tax code that they paid no federal income taxes at all last year — if Republicans in Congress follow their pledge to Norquist, they won’t be able to close a single one of the loopholes that are allowing corporations to avoid paying their fair share.
Even Reagan recognized the difference between just plain raising taxes and simplifying the tax code to cut out loopholes that subsidize corporations. In 1984, he arranged to bring in $50 billion over three years, mainly by closing these loopholes. His 1986 reform act not only included $120 billion in tax hikes for corporations over five years, it also closed $300 billion worth of corporate loopholes.
These kinds of tax simplification solutions are available for Congress if they want them. As I wrote in April, nixing Bush’s tax cut’s for the wealthiest Americans would help the country cut roughly $65 billion off the deficit in this year alone. Closing loopholes that allow corporations to shelter their income in foreign banks would bring in $6.9 billion. Eliminating the massive tax breaks now enjoyed by oil and gas companies would yield $2.6 billion to help pay the nation’s bills.
But before Republicans in Congress change their math, they have to change their rhetoric — and embrace the reality of the economic situation they face and the one that they’d like to think they’re copying. In 1986, during the signing ceremony for the Tax Reform Act, Reagan explained that “vanishing loopholes and a minimum tax will mean that everybody and every corporation pay their fair share.”
It’s time for the GOP to take a page from their hero’s playbook. If they do so, they might be able to find some allies that they never thought possible. It’s time for “everybody and every corporation to pay their fair share.” We can all get along. Sign me up for “The Reagan Tax Reform Act of 2011.”
By: Michael B. Keegan, President, People For The American Way, Published in Huffington Post Politics, June 7, 2011
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