Reagan’s True Legacy…

We are now feeling the full weight of the disasterous fiscal policies that were employed by Ronald Reagan and embraced by the Bush administration during the 1980’s and early 1990’s. The residual effects have left our economy in tatters and financial analysts are predicting that it will take decades to recover. It’s the ‘Goldilocks’ economy. You take a bankrupt country, mix in a shrinking middle class, a weak dollar, an over-extended military, outsourcing, and capital flight, and you get a mirage. That mirage is what the Republican party is selling us. The economy is growing they say. The stock market is humming along they say. Personally, I don’t buy that kettle of fish. If you want hard proof of who’s in fact destroying our economy, just check out the graph below that was reproduced from the Office of Management and Budget (OMB).

The data is from the historical tables in the 2006 OMB Budget as download from WhiteHouse.gov, Historical Tables. It was plotted without modification. Here is the relevant two page Table 7.1 in PDF format

The sad fact is that we are living a debt driven economy and debt driven economies fail. History is chock full of examples. Reagan, despite his claims to “hate the debt”, oversaw the highest peacetime deficit spending in history…and he didn’t pay for it. Unfortunately, the current administration is blindly following the same beaten path.

If you want to reverse this shortsighted trend that could ultimately lead to cultural chaos, don’t let anymore neo-cons run the economy, because they simply don’t know how. The concept is quite elementary – you cannot spend more than you make indefinitely without consequences. The analysts are convinced we’re in trouble. Evidently the disciples of Reaganomics still haven’t learned. Maybe we need several Democratic presidents elected consecutively to teach them?