US Economic Takeover – How Did They Swing It?
Ronald Reagan and his Merrill Lynch Treasury Secretary Donald Regan
Reagan and Bush 41 quadrupled the national debt in only 12 years. Bush 43 doubled it again in only eight. It is now 10 times higher than it was in 1980 when Reagan was elected.
The hero of the conservatives, Ronald Reagan begun an era in which a small minority grew vastly rich, while working families saw only meager gains. He also broke with longstanding rules of fiscal prudence. While the taxes on the super-rich went as high as 90 percent in the past – still leaving them more than enough for a lavish lifestyle – the so-called “trickle down Reaganomics” lowered those taxes by about two-thirds. The rhetoric of course emphasized the tax benefits for the average Americans, who were ostensibly the beneficiaries of those policies.
All of this, while the Regan administration kept preaching about “small government, free markets and democracy”.
Those who actually believed in the above Reagan TV commercial should be seriously surprised that the Federal debt as a percentage of GDP fell steadily from the end of World War II until 1980, rising for the first time in decades under Reagan and Bush 41, falling under Clinton and rising again under Bush 43.
Even though some people like to portray the Reagan legacy as an anti-communist success story, Reagan’s biggest legacy was the change in America’s financial rules.
Let’s start with the tax cuts for the rich, following with turning the federal retirement from a Civil Service Retirement System (CSRS) to the Federal Employees Retirement System (FERS). The former was (and still is for some long-time federal employees), a pension system, based on years of service and FERS consists basically of the Thrift Savings Plan (TSP), a 401k setup, in which untold billions of federal worker’s retirement funds get largely invested in various Wall Street schemes every two weeks. It was in effect an enormous gift for the Wall Street apparatus, while depriving millions of government employees of a viable retirement option.
At the same time, the Reagan administration deprived the Americans of the ability to deduct interest payments for anything not directly related to their primary real estate holdings.
This of course has started the epidemic of rising household debt.
Lets not forget the super-costly S&L crisis, brought about by Reagan’s deregulation.
Lets not blame poor Ronnie for everything. After all, he only started the ball rolling, even though it was in a very big way. As you probably realize by now he was only the front for all of the shady financial “wizards”, who relentlessly continue their lobbying and machinations to the present time.
The next really big breakthrough in their efforts came with the Commodity Futures Modernization Act of 2000 or CFMA (H.R. 5660 and S.3283), which in fact removed regulations of all kinds of financial crookery (called “products” by the industry) and which has returned the U.S. stock markets to the days before the 1907 Wall Street crash – in reality to legalized betting, which happens to be illegal outside of Wall Street. It was Bill Clinton, who towards the end of his second term signed this bill.
Let’s also not forget Enron and a whole bunch of other events, for which nobody has really gotten punished in any meaningful way.
Lets not forget Greenspan, Rubin, Summers and others, who continue to play important roles in our economy.
And don’t for a minute forget the fact that former and present Goldman Sachs executives are sprinkled throughout both the government and our financial system, continuing in their unrelenting mission.
If you enjoyed this post, make sure you subscribe to my RSS feed!Tagged with: bush • clinton • Economy • goldman sachs • greenspan • Reagan • reganomics • Rubin • summers • takeover • US • wall street
Filed under: Business • Chutzpah • Crime • Economy • Human Rights • U.S. Politics • Violations • banks • congress • conservatives • obama • politics • presidency • wall street
Like this post? Subscribe to my RSS feed and get loads more!
I think that I need to read your blog more because I am finally starting to get politics a little:)
Heidi, you are always welcome here!
Ross Perot,way back when,said it best..The numbers just don’t add up..That goes for both parties..
I really don’t believe either party has the average citizen in mind once they reach office..It’s time for a viable third party
MegaMan, that’s what I have thought for years. Let’s just hope that it a viable one for a change.
Looking back on all of this with more sober eyes, it is astonishing that during Republican administrations, the “man on the street” would parrot out as “fact” the idea that GOP governments were reducing taxes, downsizing the number of federal employees and pursuing a competent foreign policy. This would foster a “background” of mistaken certainties even when precisely the opposite was actually taking place in the country.
The same outrageously antithetical analysis of history still prevails today. Standing right along side those who are “certain” that Sadam Hussein was behind the 9/11 attack — while busily building h-bombs in what turned out to be no more than a trailer park east of Cairo — are myriads more who revere Reagan as a veritable saint.
They have to obsessively concentrate on the “saint” idea while they avoid absolutely every shred of contradictory history.
Chad, God save us from “saints” such as Ronnie!
You leave out the economic problems under Carter which contributed towards spending under Reagan… sort of like how liberals excuse Obama’s spending because it is to “correct” what Bush did.
Well, Harrison, the economic problems under Carter, such as the oil shortage were caused by the Arab states’ reaction to the U.S. help to Israel during the 1973 war, not anything being particularly Carter’s fault. In the case of Reagan, it was done purposefully and it really started the ball rolling – the same ball, which we are still trying to stop today.
I didn’t say it was Carter’s fault although I don’t think he did much to help necessarily. Having gutted the military didn’t help, either.
Harrison, that is a common misconception. In fact, Carter was the one who started rebuilding the U.S. military, after it has been gutted following the Vietnam War.
Really?
http://www.americanthinker.com/blog/Defense%20Spending.jpg
Yes, Harrison, really. Even that graph you are showing clearly portrays that military spending was going up during the Carter years. As you probably realize he was president from 1977 to 1981. As the graph clearly shows, the military spending started going down again during Reagan’s’ 2nd term.
All in all the U.S. military spending is so incredibly out of control that it is almost ridiculous. As a matter of fact the 2009 U.S. military budget is almost as much as the rest of the world’s defense spending combined.
To settle this little spat means more than simply siding with one side or the other. I’ve posted a copy of the debt history graph from the US Treasury Office of National Debt. As far as blaming the unelected “W” for the current economic mess, that data is there, too.
It will take more than a few half-baked talking points to swamp the now traditional Republican policies of endless cronies, big government, huge deficits, onerous, crooked wealth redistribution and tax systems which seem intent on initiating class warfare. Add to this taking credit for wars not fought and doing their damnedest to lose wars that are fought, and the stark reality of the GOP emerges. This stink doesn’t even include the preposterous “family values” of a dithering (sorry Mr. Dick — OBTW, why aren’t you in prison…?) overweight, grey haired dottering gaffers who can’t keep their pants zipped.
Yuck.
For a quick look at the graph, visit MeanMesa.
http://meanmesa.blogspot.com/2009/10/another-task-for-obama.html