I'm not a fan of deficit financing, Joe and neither was Reagan. He always maintained that the thing he was most sorry about was the amount of debt he incurred. When you look at the amounts involved however it's striking how little debt Reagan DID incur for what he accomplished. Then compare THAT to all the debt that Barry has incurred for what he hasn't accomplished. Barack Obama manages to rack up huge amounts of debt while he accomplishes very little. You have to have a real KNACK for that!
Debt was not part of our problem or even our national lexicon, UNTIL Reagan...
Where did our debt come from? When did massive debt become part of the American economy? Was it New Deal Democrats? No....they PAYED for what they spent. It all started with the 'welfare queen' mentality of Ronny Reagan who switched the federal government from what he critically called, a “tax and spend” policy, to a “borrow and spend” policy.
Reagan switched the federal government from what he critically called, a “tax and spend” policy, to a “borrow and spend” policy, where the government continued its heavy spending, but used borrowed money instead of tax revenue to pay the bills. The results were catastrophic. Although it had taken the United States more than 200 years to accumulate the first $1 trillion of national debt, it took only five years under Reagan to add the second one trillion dollars to the debt. By the end of the 12 years of the Reagan-Bush administrations, the national debt had quadrupled to $4 trillion!
And where was all this angst and concern about debt from conservatives when Bush and Republicans controlled the White House and both houses of Congress for almost a decade??? When Bush was starting a 3 trillion dollar war of ideology in Iraq, there was not a ******* PEEP from you right wingers, just cheers and 'bring 'em on'... And where was this less government mantra? You right wingers LOVED BIG government and government intervention into people lives... the Patriot Act, trashing habeas corpus, the Geneva Conventions and the US War Crimes Act.
And what was the concern in the Bush administration about debt and deficits? NONE...Bush's solution was to eliminate the voices of concern.
Paul O'Neill was fired from his job as George Bush's Treasury Secretary for disagreeing too many times with the president's policy on tax cuts.
The president had promised to cut taxes, and he did. Within six months of taking office, he pushed a trillion dollars worth of tax cuts through Congress.
But O'Neill thought it should have been the end. After 9/11 and the war in Afghanistan, the budget deficit was growing. So at a meeting with the vice president after the mid-term elections in 2002, O'Neill argued against a second round of tax cuts.
"Cheney, at this moment, showed his hand. He said to O'Neill: 'You know, Paul, Reagan proved that deficits don't matter. We won the mid-term elections, this is our due.' Â… O'Neill was speechless."
"It was not just about not wanting the tax cut. It was about how to use the nation's resources to improve the condition of our society," says O'Neill. "And I thought the weight of working on Social Security and fundamental tax reform was a lot more important than a tax reduction."
