Carter asked the country to build a moonshot around lowering oil consumption -- which would make us less dependent on terrorists, and less exposed to the $200 barrel. Even if we just decreased our oil consumption by 10% (over 30 years, as Carter asked) we would be able to save our economy from the new world of oil scarcity and oil shocks. Reagan saw it differently.
Reagan framed Carter as a crazy Lefty, saying there was no need to worry about the middle east. (The Reagan ascendancy was funded primarily by big oil, which captured Washington and destroyed energy competition, including the first major electric car movement.) Reagan greatly increased our military investment in middle eastern oil, and he hid Pentagon costs off-budget in emergency spending measures. -a trick perfected by Bush 43 to hide the costs of Iraq. By framing Carter's energy worries as crazy, Reagan's message to Detroit was clear: build big gas guzzlers because oil will never become a problem. Message to builders: build bigger more remote suburbs because oil will never become a problem. (Welcome to the greatest misallocation of resources in American history. America doubled down on a scarce resource that would never be able to keep up with growing demand in China and India) "Don't worry about oil or the middle east" Reagan said. "No need for alternative energy or conservation. No need to create less petrol-intensive transportation and production infrastructures. Carter is crazy".
(all the while hiding the Pentagon costs of military oil extraction)
Reagan, with his destruction of the Sherman Act and his war against anti-trust legislation, ushered in an era of mega-mergers a.k.a too big to fail monopolies in banking and insurance, which lead to the 2008 meltdown where a handful of financial giants were, by virtue of their size, playing with the house's money. And let's not forget about another Reagan gem, the consolidation of media into less than 10 mega-corps, leading to a world where voters are kept in hermetically sealed bubble of wedge issues, anti-government populism, and overblown terror plots, as a handful of corporations loot the country and consolidate their power over the political process.
Finally, Reagan convinced the country that it did not need to invest in, or protect the solvency of the middle class. He undermined Labor, wages, and benefits to improve the bottom line of transnational corporations. He promised that this would result in more jobs, but right after he said it, all the jobs began leaving the country. The result was a steady decline in the economic viability of a whole class of Americans. When the money failed to trickle down and the jobs trickled overseas, the Reagan Revolution created the credit industrial complex -- the wealthy would now loan (loan at a high rate) the middle class the money they used to make in wages and benefits. Consequently, the US spent 30 years fueling consumption with Master Cards (i.e., debt rather than actual money). After the election of Reagan, almost every human with a postal address received 3 credit card offers a week. Welcome to the brilliance of Reaganomics. Give all the money to the wealthy, and keep the middle class alive with debt (first with Visas, than with their houses). Eventually this kind of structural flaw destroys the economy.
Reagan, by waging war on the expensive, entitlement-fed middle class, created a 3rd world distribution structure in America, i.e., a place with staggering pockets of wealth surrounded by cheap labor and exploding poverty. What did you think would would happen when government cut all of its programs and protections for the middle class in order to give tax cuts to millionaires and billionaires?
You might be wondering what happened to the excess capital on top? Did it get invested it in the real economy? Nope, capital, when facing insolvent consumers, has no incentive to create jobs (see zero demand). Meaning: in a post easy-credit universe, the working class, lacking sufficient wages and affordable health care, can't afford to consume. Which is why the Bush tax cuts never trickled down; rather, they flooded Wall Street looking for a higher return. The problem: the ratio of capital to sound investment opportunities was skewed because there was no demand to capture; therefore, Wall Street had to create a massive ponzi scheme to invent solid returns whole cloth. They needed more and more mortgages to securitize because that was the only faucet left with any money. And we all know how that ended.
So we had the worst of both worlds: too much capital on top chasing limited investment opportunities (thus resulting in an orgy of speculation and phantom wealth creation), and no money on the bottom for consumption in the real economy, thus requiring an over-reliance on credit. Reaganomics was not only an economic disaster; it was, ironically, a social disaster for families (forcing woman into the workplace so that children would be raised by MTV and video games) -- it literally ended the great American chapter in history. It transferred generations of wealth into a narrow group of interests who now own government and media. Talk about the centralization of power. Silly Rabbit. Financial Power is Political Power, and Reagan allowed for the concentration of financial power unlike any president in history.
