Happy 100th Birthday, Ronald Reagan.
Not so happy for the rest of us since his disastrous presidency beginning in 1981.
Most of the pathology of our current economy began in the late 1970s and accelerated in the 1980s and since.
See it for yourself in these charts:
Here’s what we have after thirty years of Reaganomics:
Taking his cues from the conservative billionaires who fund right-wing think tanks like the Heritage Foundation, Reagan cut top marginal tax rates on the rich from 74 percent to 38 percent. Predictably, there was an immediate surge in the markets—followed by the worst crash since the Great Depression and the failure of virtually the entire nation’s savings-and-loan banking system.
Then came Bush Sr., running on his “no new taxes” pledge, who cut taxes once in office; the nation fell into a severe recession while debt soared and wages for working people fell.
During the Bill Clinton era, things stabilized somewhat when he slightly raised taxes on the very rich, but he was followed by Bush Jr., who cut them again, including cutting taxes on unearned income—interest and dividends that people like W, who are born with a trust fund, “earn” as they sit around the pool waiting for the dividend check to arrive in the mail—down to a top rate of 15 percent. That’s right, trust fund babies like Bush (and hedge fund billionaires) pay a maximum 15 percent federal income tax on their dividend and capital gains income, thanks to the second Bush tax cut.
The result of this surge in easy money for the wealthy, combined with deregulation in the financial markets, was the “froth” Greenspan worried about that led us straight into the Second Republican Great Depression in 2008.
The math is pretty simple. When the über-rich are heavily taxed, economies prosper and wages for working people steadily rise. When taxes for the rich are cut, working people suffer and economies turn into casinos. (Excerpt from “Roll Back the Reagan Tax Cuts” by Thom Hartmann).