Its more serious inflation-related sin is to claim that the disinflation caused a "spending windfall", when (as I understand things) its primary fiscal effect was revenue shortfalls due to bracket non-creep.

I think your 1993 piece similarly tries to "confuse the reader", by repeating what the IPI analysis calls "the prevailing myth in Washington that Reagan actually requested larger budgets than Congress approved, which is true only if one solely examines appropriated items and excludes entitlement spending. Yet omitting entitlements from the budget picture excludes half of overall federal spending and the very programs whose expenditures have expanded most rapidly since 1980 [..] Congress consistently permitted more spending on entitlements than Reagan requested. The Reagan budgets routinely called for money-saving entitlement reforms—in health care, in the huge catalog of welfare programs, in veterans benefits, and so on. Congress killed those reforms by simply ignoring them. In other cases, Congress actually increased benefits and expanded eligibility for entitlements. [..] entitlements, the other half of the budget, were not subject to [appropriations] veto at all."

The Washington Monthly article reinforces the point: "At the start of his administration, with Social Security teetering on the brink of insolvency, Reagan attempted to push through immediate draconian cuts to the program. But the Senate unanimously rebuked his plan, and the GOP lost 26 House seats in the 1982 midterm elections".

> The second piece is by Stephen Moore --and I don't have time to waste
> detailing what's wrong with it.

It's a wide-ranging piece, but its specific treatment of the Reagan deficits -- blamed on defense and disinflation -- seems more balanced than that of your 1993 piece. You can't seriously expect the facts you cite to settle the question of the political responsibility for the 1980s deficits.

> The third piece says what I said: Reagan never proposed the
> deep spending cuts that would have been required to balance the budget.
>
> It says it with a different spin: it says that if Congress had accepted Reagan's
> spending figure in 1987 (say), then Reagan would have proposed deeper
> spending cuts in 1988.

If for FY1982 Congress had accepted a Reagan proposal to cut entitlements or eliminate a program, then he wouldn't have had to re-propose that cut/elimination seven more times for FY1983-1989; it would have been the baseline.

> But because Congress spent a few tens of billions more in 1987 than
> Reagan had asked for, it was impossible for Reagan to propose deep
> spending cuts in 1988.

Not impossible, just significantly harder. (Keep punching that "impossible" straw man; you've got him on the ropes. :-)

> The underlying unexpressed argument seems to be that Reagan did not
> propose the kind of deep spending cuts needed to try to balance the
> budget because in the judgment of his political people they would have
> been unpopular. While this is true, this is something that the Reagan team
> should have thought about before they pushed the 1981 tax cut, isn't it?

In 1981 Reagan pushed not only a tax cut but also spending cuts and entitlement reforms. Congress agreed to (and bid up) the tax cut, but accepted few of the spending cuts and none of the entitlement reforms. See David Stockman's book, pp 181-193.

If you take FY1981 as a constant baseline (I don't know the c1981 outyear projections),
the eight subsequent Reagan fiscal years included:
$766B in extra defense spending
$1132B lost to the 5-10-10 and 10-5-3 tax cuts [Stockman p268]
but also
$359B in extra tax cuts demanded by Congress [Stockman p268]
$839B in increased entitlement spending
$209B in Congressional appropriations beyond Reagan's budget requests

FY1982-89 included $947 in extra deficits beyond the Democrats' FY1981 deficit pace. Even ignoring the compounding nature of the Congress' ignored cuts and extra spending, it seems that much of that extra deficit would not have happened if Congress had done what Reagan wanted.

Reagan was probably willing to cut spending and entitlements enough to not increase the deficit he inherited. The Democrat Congress was probably willing to tax higher earners enough to effectively eliminate the deficit. Neither fact absolves either side from responsibility for the deficit. I'm tempted to say the responsibility is about even, except then I look at what each side bought. In my opinion, Reagan bought increased tax equity and victory in the Cold War, while Congress bought continued incumbency with increased entitlement payoffs to mostly-middle-class mostly-elderly voters. History will record that the great inter-generational crime of late twentieth century America was not the "Reagan" deficits, but the ponzi-style Democrat entitlement schemes that Congressmen of both parties used to purchase almost guaranteed tenure.

Posted by: Brian Holtz on March 6, 2003 12:49 AM