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Monday, June 20, 2011

Proof Reagan's Tax Cuts FAILED As A Stimulus?

Last week Limbaugh was again spouting the Right's nonsense that tax cuts are some magic bullet for the economy as if the evidence wasn't in from the Bush2 years. Tax cuts them failed to either stimulate the economy or inoculate the economy against recession. We might have avoided that mistake if we just went back and learned from an earlier example... the era of Voodoo Economics.

In February 1981 the Reagan admin wrote of their new economic plan

The program we have developed will break that cycle of negative expectations. It will revitalize economic growth, renew optimism and confidence, and rekindle the Nation's entrepreneurial instincts and creativity.

The benefits to the average American will be striking. Inflation—which is now at double digit rates—will be cut in half by 1986. The American economy will produce 13 MILLION NEW JOBS by 1986, nearly 3 million more than if the status quo in government policy were to prevail. The economy itself should break out of its anemic growth patterns to a much more robust growth trend of 4 to 5 percent a year. These positive results will be accomplished simultaneously with reducing tax burdens, increasing private saving, and raising the living standard of the American family.

In reality, just 5 months later, the economy sank into what was then the worst recession since the 30's. Unemployment hit a peak of 10.8% by December 1982... higher than it was under Obama. The unemployment rate remained over 8% for nearly 2 years, from March 82 through January 84.

Source... you'll have to construct your own tables here:

As for the actual job creation numbers under Reagan?

FOX says "Under Reagan, 9.5 million jobs were created from January 1981 to December 1986."


That's it? Even when Fox gives Reagan an extra YEAR, Reagan could not meet his own job creation prediction of 13 million new jobs by 1986 (Jan 86) and was 3.5 MILLION jobs off.

I don't know where FOX got it's 9.5 million new jobs number but at the BLS site you can also run the job numbers.

In February 1981 when that White House reported predicted 13 million new jobs by 1986... the total workforce was estimated to be 108,242,000. In January 1986 the number was 116,682,000.

Where Reagan predicted 13 million jobs... it looks like a mere 8.4 million were created. That's 4.6 MILLION off Reagan's prediction.

Reagonomics was a utter failure yet the Orwellian Right has erased this failure from the minds of GOPers just as they are busy erasing the Bush2 failures.

So why would someone want to deliberately the public believe in a FAILED policy?

Because the REAL intent of these irresponsible tax cuts was NEVER economic stimulus but a reason the far Right can never admit to... to sabotage government revenues and drive up debt hoping to eventually bring us to the point we are at now... where the Right hopes to drive a stake in the heart of all those New Deal and great Society programs they've always loathed. To preserve this strategy the Orwellian Right has rewritten history and turned irresponsible tax cuts not just into a shining success but into a religion. They know fully well facts really don't stand a chance when the Right wing faithful inoculate themselves against them.