Guest Posting by T. D. Poole, Clayton, NC
"Damn it!" Exclaimed the president. "I knew they were going do that to us." The person was Ronald Reagan, thirteen days before he became president. The occasion. the first meeting of his senior staff to discuss the 1982 budget. The cause of the unhappiness, a chart that Reagan's budget manager, David Stockman, had brought for the meeting. That chart showed what had happened to the 1981 fiscal year budget that had been prepared by the Carter administration. According to Stockman, the budget was already $58 billion in deficit and nine months were still left in the fiscal year. That budget would have a deficit of $78.968 billion. Many at the meeting thought they had been sabotaged by the Carter administration.
In Reagan's battle with Carter during the election. Reagan promised many things, including: ease the pain of inflations, increase defense spending, cut taxes, and have a balanced budget by 1983. The budget manager had prepared a large chart and brought it to the meeting. It was not to make a political point, but to show the attendants the difficulty of the problems that they faced in the real world.
That $78.968 billion deficit that so upset the "Reaganites" would be the smallest deficit for the next 16 years. That is until Clinton's $21.884 billion deficit in 1997. The only other time that this country has been without a balanced budget for sixteen years was 1930-1946. In those sixteen years, we had eleven years of the Great Depression under Hoover and Roosevelt, four years of WWII, and a year to return 12 million military personnel to civilian life.
While Truman was president, almost 8 years, there were four budgets with a surplus. His last surplus was in 1951, the second year of the Korean War. That surplus was $6.102 billion, which was over eight times greater than the total surpluses of Hoover's four year term and 80% as large as The total Republican surpluses from Hoover in 1930 until today.
The 1983 balanced budget that Reagan had promised did not balance. There was a deficit of $207.802 billion dollars. That was 2.63 times as large as the Carter deficit Reagan had criticized. Reagan's total deficits in eight years totaled $1.86 trillion. The total debt after Carter's 1981 budget was $997.855 billion. Reagan increased the debt by 186%. That was a 54% more increase in debt, percentage wise, than there was in Roosevelt's eight years - 1933-1941. The debt had increased 132% during Roosevelt's first 8 years. Part of that increase was caused by military buildup in 1941.
The politicians of both parties usually promise to balance the budget, but from 1930 through 2008, 78 years, there have only been 4 presidents that presented a budget to congress that was approved, enacted, and ended with a surplus. One was a Republican, Eisenhower. Three were Democrats, Truman, Johnson, and Clinton. Eisenhower's total surplus was about $7.66 billion. Johnson's surplus was $3.242 billion. Clinton had four that totaled $558.337 billion.
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THE TOTAL SURPLUSES OF THE BUDGET BALANCING REPUBLICANS SINCE 1930 TOTAL $7.66 BILLION. THE TOTAL DEMOCRATIC SURPLUSES SINCE 1930 HAVE BEEN $584.065 BILLION. THAT'S 76 TIMES THE REPUBLICAN SURPLUS.
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Things under Reagan may have gotten better for many tax payers, but they continued to get worse for the country. After eight years of "Reaganism", the deficits increased and the number of people joining the work force decreased. Reagan had one deficit of $221 billion, but all of BUSH SR's deficits went over $220 billion, Bush Sr.'s third deficit was over $290 billion. There had been no crash of the system as there had been in 1837, 1873, 1929, and 2008. That one deficit was more debt than had accumulated through all the depressions and all our wars through the Korean War.
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IN THE FOUR YEARS PRECEDING REAGAN, WHILE CARTER WAS PRESIDENT, 11,818,000 PERSONS JOINED THE WORK FORCE. AFTER EIGHT YEARS OF REAGANISM, ONLY 3,524,000 JOINED THE WORK FORCE DURING THE BUSH'S FOUR YEARS. THAT WAS LESS THAN ONE THIRD THE NUMBER THAT JOINED UNDER CARTER IN THE SAME NUMBER OF YEARS.
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The deficits of Bush Sr. were the largest in history until Bush Jr. took office. The budget that was in place when Bush took office was a product of the Clinton administration. Bush served 8 months and 11 days while that budget was in place. The budget had a surplus of $128.236 billion. There was not another balanced budget while Bush served, hasn't been one since, and will probably not be another balanced budget in my children's lifetime.
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THERE HAVE BEEN FOURTEEN BUDGETS WITH DEFICITS OF OVER TWO HUNDRED BILLION DOLLARS FROM 1789 THROUGH 2008. THREE BY REAGAN, FOUR BY BUSH SR., ONE BY CLINTON, AND SIX BY BUSH, JR. THIRTEEN WERE BY PRESIDENTS THAT CLAIMED TO BE CONSERVATIVES.
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People blame Obama for the vast debt, but it was George Bush, "the decider", who was responsible for every decision in the executive branch for 112 days after the budget that he put together began. His actions look suspicious. The recession began late in 2007. Did he not know there was a problem? Was he just trying to get out of office before everything fell apart? Or did he just wait until the red ink loans etc would go on the 09' budget? It is possible that his secretary, Hank Paulson, who had been CEO of Goldman Sachs and knew they were dealing in subprime mortgages, wanted to wait a while to give his old cronies a chance to unload more of their trash?
The federal reserve knew in 2007 that there was a problem. It began to put in place programs that amounted to $16 trillion dollars to help with the problem. Why didn't Bush know this?
It's strange that many people today can complain about lack of jobs when we have had the greatest crash in the financial section and stock market in history after all the tools that usually, at least that is what some claim, have been used. Interest rates were cut already about as low as they can go. Bush had cut income taxes three times. Each time they were supposed to "fix the problem", but they did not. He cut the capital gains and dividend rates to a 5% rate for some. The stock market still went to hell. In his (Bush's) third year in office, after tax cuts, unemployment went from 4% to 5%, 4% was the rate when he took office. That was a 50% increase after using all the tools.
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AFTER OBAMA HAD BEEN IN OFFICE FOR ABOUT 21 MONTHS, THE UNEMPLOYMENT RATE WAS 9.6%.
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IN 1983, AFTER CUTTING TAXES FROM 70% TO 50% TOP BRACKET, THE UNEMPLOYMENT RATE WAS 9.6% AND IT WAS REAGAN'S THIRD YEAR IN Office. IT HAD BEEN 9.7% IN 1982. IT WAS 7.1% WHEN REAGAN WAS ELECTED. IN 1992, WHEN BUSH SR. LEFT OFFICE, THE TOP TAX RATE WAS 31%. IT HAD BEEN CUT 55.7% AND THE UNEMPLOYMENT RATE WAS STILL 7.5%. IN TWELVE YEARS TWO REPUBLICAN PRESIDENTS HAD QUADRUPLED THE DEBT AND STILL HAD A HIGHER UNEMPLOYMENT RATE THAN IT WAS WHEN REAGAN WAS ELECTED.
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From 1934, Roosevelt's first budget until 1947, Truman's first balanced budget, there were twelve continuous years of presidents from the same party who did not have a balanced budget. Four of these years we were at war. The only other twelve year period where members of the same party served and there was no balanced budget was 1981-1993. When Reagan took office, Carter's budget still had eight months and eleven days left. It ended with a deficit of $78.936 billion. The employed persons increased by 2,889,000 per year for four years under Carter. That was the largest increase in peace time history. Bush Sr.'s average for four years after Reagan was only 881 thousand per year.
If those two men could not balance a budget in twelve years with conditions as they were at that time, how is either party going to do much about the economy now or balance a budget?
The Republican record for employment over the last 84 years is not much better than their financial skills. They talk a good game, but history does not agree. Every Republican president, except Nixon, since Coolidge in 1928 have not only had high unemployment rates, they have also had one or more years that fewer people were employed than the previous year or years. The only Democratic president that had an decrease in the number of employed was Kennedy. There were 38,000 fewer employed in 1961, his first year in office, than there were in 1960. That was the smallest number of any president.
Unemployment was 8.5% in 1975, the year before Carter was elected. In 1980, Carter's last year in office, the rate had dropped to 7.1 %. After Reagan cut the top tax bracket from 70% to 28% the unemployment rate increased to 9.7%. Five years after Carter left office, the rate was 7.2%. The tax rate for Bush Sr.'s first three years was 15% and 28%. The top rate was 31% in his fourth year.
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FROM 1952 THROUGH 2008, 85,119,000 PERSONS JOINED THE WORK FORCE. IN 36 YEARS Of REPUBLICAN PRESIDENTS, 44,760,000 OR 1,243,333 PER YEAR, JOINED THE WORK FORCE. IN 20 YEARS OF DEMOCRATIC PRESIDENTS 40,359,000 OR 2,017,950 PERSONS PER YEAR FOUND A JOB. THAT WAS AN AVERAGE OF 774,612 MORE PERSONS THAT JOINED THE WORK FORCE WHILE THERE WAS A DEMOCRATIC PRESIDENT THAN THERE WERE WHEN A REPUBLICAN WAS PRESIDENT.
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After twelve continuous years of Republicans in the White House, when Bush Sr. left office the unemployment rate was 7.5%. That was 4% higher than it was when Carter left office. After Carter left office the national debt Increased from $997.6 billion to $4.411 trillion under Reagan and Bush. That's over a 300% increase in twelve years. The only change for all that debt was a 4% increase in unemployment. So why should we believe that cutting taxes again will fix the problems faced by our country? Cutting taxes did not work for Reagan, nor Bush Sr., nor Bush Jr. It did not even work for Coolidge in 1926. It probably will not work for Romney either.
Carter's administration was responsible for and prepared the 1981 fiscal year budget. Carter was in office 112 days of that fiscal year.
George Bush's administration was responsible for and prepared the 2009 budget. Bush was in office 112 days of that fiscal year.
The national debt increased $10.958 trillion dollars from the end of Carters 1981 budget through Bush's 2009 budget. Bill Clinton served eight years between 1993 and 2001. The debt increased $1.396 trillion dollars while Clinton was president. Reagan, Bush Sr., and Bush Jr. were in office or prepared the budgets for the twenty years that added 9.562 trillion dollars to the national debt. The economy still crashed.
Reagan, Bush Sr., and Bush, Jr. served as president for 20 of the 28 years from 1981 through 2008. They had no balanced budgets. Reagan. Bush Sr.. and Bush Jr. presided over the budget process for twenty of the twenty eight budgets of the fiscal years 1982 through 2009.
Together the three added $9.562 trillion dollars to the national debt. If they could have kept the economy adrift by any means other than national debt, why didn't they do it?
There were twelve years in succession without a surplus. Then there were four years under Clinton that gave us surpluses. When Bush Jr. took office, there was a balanced budget. Many of the officials in the second Bush administration had served in previous years. They should have done better than the previous administration, but they did worse. Now our country is in much worse trouble than it was in 1929. We have had, at most, 13 balanced budgets in 82 years.
Many of the politicians now are calling for a cut in federal spending. When Jefferson ran for office in 1800, he promised to cut federal spending. Hoover and Roosevelt talked about a balanced budget in 1932. Reagan signed a bill that required a balanced budget by 1991. That didn't happen then and will not happen for a long time.
If a person in either party looks at what this country has done financially since the Korean War until today and thinks about what has happened and still believes we can just change leadership and a few policies, and things will be good, there will have to be another word added to the dictionary. Stupid and ignorant will not describe the person.
Paid for by T.D. Poole, Clayton, NC 27520
Ad was published in News & Observer Sunday August 5th 2012
