Figureheads are great until they die, then they must be replaced: a process that can be somewhat tricky, no matter the organization.
But for the Republican Study Committee (RSC), maybe not so much. After all, they're privy to a library of footage attached to corporate America's most beloved figurehead of all time: Ronald Reagan.
And who's to say old Ronnie can't still work a bit of that old charm on U.S. voters?
That's precisely why the RSC has crafted a new Internet advertisement called "Those Voices Don't Speak for the Rest of Us," juxtaposing video of a famous Reagan speech with context-free clips of Democrats such as Rep. Barney Frank, House Speaker Nancy Pelosi, Vice President Joe Biden and President Barack Obama.
Their message is decidedly pro-business and features Reagan proselytizing about the evils of a government that controls a nation's economy. This alternates with bits where currently-serving Democrats deliver several words of a sentence in a black and white monochrome, set to scary music.
Then there's Rep. Frank, speaking about the recovery act. He says, "there needs to be a focus on an immediate increase in spending."
And cut back to Reagan.
That such a clip would be used as some kind of contrast seems a bit odd. The former b-movie actor's administration tripled the U.S. deficit and grew the size of the federal government by over 60,000 new workers: two facts that would seem to demolish the RSC's entire premise.
Examining the conservative patron saint's record, it would seem that a litany of his actual policies are diametrically opposed to those his party favors today, like seeking to destroy Social Security by instituting private, stock market-based retirement savings accounts modeled after those forced upon Chile during the rule of U.S.-backed right-wing military dictator Augusto Pinochet. The destruction of Chile's social security-like program, and indeed many of the brutal dictator's fiscal policies, enjoyed explicit support of the Reagan administration, which held Pinochet in high regard.
Even so, after dipping a toe into the possibility of handing Social Security off to the private sector, Reagan backed off, eventually going so far as to bail out Social Security to the tune of $165 billion.
As Washington Monthly's Joshua Green explained in a 2003 piece:
At the start of his administration, with Social Security teetering on the brink of insolvency, Reagan attempted to push through immediate draconian cuts to the program. But the Senate unanimously rebuked his plan, and the GOP lost 26 House seats in the 1982 midterm elections, largely as a result of this overreach.
The following year, Reagan made one of the greatest ideological about-faces in the history of the presidency, agreeing to a $165 billion bailout of Social Security. In almost every way, the bailout flew in the face of conservative ideology. It dramatically increased payroll taxes on employees and employers, brought a whole new class of recipients--new federal workers--into the system, and, for the first time, taxed Social Security benefits, and did so in the most liberal way: only those of upper-income recipients.
Faced with looming deficits, Reagan raised taxes again in 1983 with a gasoline tax and once more in 1984, this time by $50 billion over three years, mainly through closing tax loopholes for business. Despite the fact that such increases were anathema to conservatives--and probably cost Reagan's successor, George H.W. Bush, reelection--Reagan raised taxes a grand total of four times just between 1982-84.
Reagan continued these "modest rollbacks" in his second term. The historic Tax Reform Act of 1986, though it achieved the supply side goal of lowering individual income tax rates, was a startlingly progressive reform. The plan imposed the largest corporate tax increase in history--an act utterly unimaginable for any conservative to support today. Just two years after declaring, "there is no justification" for taxing corporate income, Reagan raised corporate taxes by $120 billion over five years and closed corporate tax loopholes worth about $300 billion over that same period. In addition to broadening the tax base, the plan increased standard deductions and personal exemptions to the point that no family with an income below the poverty line would have to pay federal income tax.
Still, Reagan's most lasting fiscal legacy was slashing the top marginal tax rate by more than half. When Reagan took office, the wealthiest Americans paid 69.13 percent of their earnings in taxes. That figure was reduced to just 28 percent by the administration's end.
Conservative thinktank The Heritage Foundation, one of the principle lionizers of the Reagan legacy, summarizes Reagan's economic efforts as "responsible and successful fiscal policy," while essentially pretending -- as many Republicans do -- that he never actually raised taxes. They instead insist, and many prominent Republicans thoughtlessly repeat, that the results of his cut to the top marginal tax rate and massively increased defense spending on deficit somehow had positive effects on poor and middle class Americans.
This is not true.
"[You] don't need little Johnny Boehner to tell you that tax rates, even for the wealthiest Americans, are now already 14% lower than Reagan's 1981 tax cut, nor that 95% of Americans received a tax cut in the Obama stimulus, nor that tax rates will still be 10.5% lower for the wealthiest when Obama allows the George W tax cuts to expire, nor that those cuts were intended to expire for the simple reason that they were projected then to cause to big a hole in the deficit," Huffington Post blogger Paul Abrams summarized.
He adds: "the unemployment rate under Reagan went from 7.6% to 9.7-9.8% in the summer after his inaugural, and remained at that level for two years, before it began to decline in the summer of 1983. In 'Obama-time', that would be the equivalent of the summer of 2011. Moreover, the economy did not begin improving until the Spring, 1983, in 'Obama-time' that is Spring, 2011."
Another famed, often lionized Republican president, Dwight Eisenhower, had a top marginal tax rate that hit 92 percent at its height: one of the reasons the U.S. was able to build such a robust highway system.
Perhaps it's telling then, that Republicans choose Reagan over Eisenhower for their advertising today.
Richard Band, writing for Profitable Investing, has more:
In Ronald ReaganÃ¢â‚¬â„¢s heyday, capital gains were never taxed at less than 20%, and dividends were never taxed at less than 28%. Under the DemocratsÃ¢â‚¬â„¢ current proposal, the president aims to raise the capital gains tax to a maximum of 20% on long-term gains (from 15% at present). And in an even more pleasant surprise, the top tax on dividends will also go to just 20% as well.
HereÃ¢â‚¬â„¢s the scorecard again so thereÃ¢â‚¬â„¢s no confusion: Reagan was at 20% for capital gains and 28% for dividends. Obama is at 20% for capital gains and 20% for dividends.
As an investor, then, I have to view ObamaÃ¢â‚¬â„¢s tax policy at least as favorably as ReaganÃ¢â‚¬â„¢s. In fact, for those of us who cherish dividends, it may be a little better.
Yet, today's Republicans seem intent on pretending their most successful leader in the last three decades is someone he's not, which is theoretically why you should vote for them.
President Reagan's fiscal policies and foreign misadventures left the U.S. saddled with trillions in debt, leading to a devastating recession and widespread joblessness, and it cost his Republican predecessor a potential second term. Decades later, the same party would champion George W. Bush as Reagan's true successor, only to bring about an even greater financial calamity and even more deadly foreign entanglements, ending in an unprecedented outpouring from the U.S. Treasury into the coffers of the nation's largest banks and insurers.
For a group that expends such effort talking up issues of debt and spending, it certainly seems odd to keep leaning on Reagan, long since dead and gone, to fight their battles for them.
This video is from the Republican Study Committee. Clips featuring Ronald Reagan are from a 1964 speech entitled "A Time for Choosing," given on behalf of paleo-conservative Republican candidate Barry Goldwater, who was running for president. The full speech is available online.