It's About Coalitions Not Purity, Part Thirteen

"Conservatism Takes Power-Reagan"

In January of 1981 Ronald Reagan became President of the United States. The ordeal of the American hostages in Iran, which had lasted well over a year, reached an end on Jimmy Carter's last full day in office, after extensive negotiations, but in an apparent effort to give Carter as little attention as possible, the Iranians only released the Americans from custody the next day, right after Reagan took the oath of office.
 
Reagan and Republicans began to try to implement their agenda, which included big tax cuts and large increases in military spending. To achieve his goals, Reagan worked with conservative Democrats, particularly in the House of Representatives, which was under Democratic control. By appealing to these Democrats, Reagan forged a coalition in the House which often provided him with a working majority. The country faced an inflation rate in the double digits, and the Federal Reserve, under Carter appointee Paul Volcker, sought to squeeze inflation out of the economy through interest rate hikes and a slowing economy. Interest rates reached 20% during 1981, and more than 21% the next year. Gradually the high interest rates slowed the economy considerably, bringing about a severe recession, which technically began in the summer of 1981. In the meantime, an assassination attempt on Reagan in March 1981 left the President hospitalized, and others wounded, including James Brady, Reagan's White House Press Secretary, who suffered a severe wound to his head, which left him disabled thereafter. The gunman was a mentally ill man named John Hinckley, who had also worked on plans to kill President Carter. Reagan was rushed to surgery and he remained in the hospital for about two weeks, but it took a few months for him to fully recover.

As Reagan recovered, but the economy moved lower, the President pushed his initial economic plan through Congress later in the summer of 1981, by which time the economy was in full retreat and unemployment eventually soared to nearly 11% in 1982. Democrats quickly pinned the severe downturn on Reagan and his policies, but in my opinion, the recession was overwhelmingly the result of policies implemented by the Federal Reserve to curtail inflation. Reagan's plan cut taxes for high incomes from 70% to 50% and from 14% to 11% for the lowest bracket, and the rate of taxation on capital gains fell from 28% to 20%.* More than a year later in the fall of 1982, the economy had worsened and Reagan's popularity had diminished considerably. Democrats scored significant gains in the House in the midterm election that year, but Reagan was still able to use conservative Democrats as part of his legislative coalition to get things passed. The severe economic downturn brought about a decline in inflation and a gradual lowering of interest rates by the Federal Reserve. Huge budget deficits from the tax cuts, high unemployment, and increased military spending helped stimulate the economy, in spite of Reagan's anti deficit rhetoric. Unemployment, the worst since the Great Depression, began to slowly recede.

All in all, a year or so before the presidential election of 1984, Reagan looked like a one-term president, but Reagan had a knack for keeping his coalition together, although his rhetoric often actually contradicted his policies or real life experience. The "religious right" became a force to be reckoned with in American politics during Reagan's presidency, and its leaders, like Jerry Falwell and Pat Robertson, preached "family values" and they loved Reagan, although Reagan had been divorced and had estrangement problems with a couple of his children, plus he rarely attended church. In the end though, most Americans liked Ronald Reagan and that helped to sustain his presidency. Polls showed his likability, while Americans were lukewarm or out and out cold toward some of his policies or ideas. Reagan loved to joke, including about himself, a characteristic seemingly liked by most Americans. Reagan tended to be in his White House office from like 9 to 5,** a preference he in fact admitted to, and Democrats dubbed him "lazy," but Reagan cracked a joke about his office hours that generally sticks in my mind to this day. When asked about his hours by reporters, Reagan told them something like, "My mother always told me hard work never hurt anybody, but I decided to take it easy, just in case she was wrong." (Although I've put this in quotation marks, this is NOT an exact quote, but rather a paraphrase from my recollections, and Reagan "may" have used variations on his quip at different times.)

With Social Security facing financial problems, Reagan worked with Democrats in 1983 to keep the popular program solvent. Reagan had long advocated that Social Security be voluntary, but in 1983, he completely reversed himself and joined with Democratic Speaker of the House Tip O'Neill to bring more revenues (deductions from paychecks) and reforms to Social Security, including gradually raising the retirement age. Reagan proved himself to be far less dogmatic than many had feared, while still keeping his conservative base intact. Americans tended to see in Reagan what they wanted to see, something that has continued to this day, as the now far more conservative Republican Party talks how Reagan didn't increase taxes, or that he had firm convictions, while all of the historical evidence on such matters shows them to be wrong, and that doesn't count the enormous budget deficits run during his presidency, even AFTER the economy had recovered from the terrible recession earlier in his term.*** Reagan regularly met with Democrats, and while he and Speaker O'Neill did battle in public, they frequently shared a drink and joke telling at the White House. This was politics on a personal level, something never done much or well by Jimmy Carter.

Next, "Conservatism Consolidates Power-Reagan"

* You can see the entire bill or its major provisions at various sites. The actual law was termed, "The Economic Recovery Tax Act of 1981," although it is also called the "Reagan tax cuts." Capital gains taxes are paid on profits from the sale of assets, and therefore tend to largely, but not entirely, benefit wealthier people. For example, just to keep this simple, you buy stock for $100 and you sell it for $300, you therefore pay capital gains based on the $200 profit. Since wealthier people own a huge percentage of all stocks, bonds, and property, they tend to benefit more by a lower capital gains tax rate. The actual percentage of such assets owned by the wealthy is somewhat in dispute, but it seems that the top ten percent in wealth own somewhere between 80% and 90% of these assets. The idea of capital gains taxes was to tax "non earned income;" that is, income not derived from working at a job or business.

** Democrats made an issue of Reagan's office hours, but by all accounts, he did take lots of work upstairs to the White House residence each day, and let's be honest, in spite of criticism by both parties of presidents from the opposing party going on vacation or not working hard enough, no president is EVER truly on vacation or off duty. Both parties get silly about some things, when there are far more important debates to engage in.

*** It is important to note about the deficits in this manner, because recessions cause budget strains, as higher unemployment brings a drop in tax revenue, while simultaneously increasing spending on  unemployment payments and programs like food stamps or public works. "Ideally" when the economy is stronger, deficits would be low, non existent or turned into surpluses. None of this happened under Ronald Reagan by the time he left office in January 1989, nor was he close to achieving such. 

WORD HISTORY:
Smite-This word traces back to Indo European "smeid," which had the notion of "rub, smear," and further, "hit, strike." This gave Old Germanic "smitanan," which meant "to throw, to fling, to smear," with the "throw" meaning likely a development from "smearing mud or lime onto a wall or object, after throwing it there." This gave Old English (Anglo-Saxon) "smitan," which meant "to smear, to make dirty, to hit." In this case, "hit" likely expanded beyond the "throwing" of mud or lime, to include other things, more generally. This later became "smiten," before the modern version. The word came to be used in Biblical translations with the meaning "slay," again likely from the notion of "hitting an enemy with a spear, rock or other thrown weapon," and it is this general meaning that has persisted into modern times. While not an every day word in English anymore, it is still in use, and it still has relatives in the other Germanic languages, which largely retain the "throw, fling" meaning (unless otherwise noted): German has "schmeissen," Low German Saxon has "smieten," Dutch has "smijten," West Frisian has "smite," Danish has "smide," and Swedish has "smita" (this has come to mean "run off," probably from the notion of "throw, projecting something away from the speaker"). Norwegian and Icelandic apparently no longer use forms of the word.