Climbing Out of Reagan's Rubble

...FAILURE OF THE FREE MARKET Climbing Out of Reagan's Rubble BY SIDNEY WEINTRAUB Following in the Nixon-Ford-Carier tradition, Ronald Reagan has perpetuated the economic shambles, with a minidepression that evokes Herbert Hoover as well...

...Most eyes fasten on the budget, the deficit, or the Federal Reserve...

...We must make government our friend, for it is our only substantial communal instrument...

...he has slowed the growth of the national government...

...This thrusts the burden of a communal responsibility on the most compassionate, allowing the most affluent-who are not the most conspicuous church-goers-to escape any obligation...

...The despair about government should smooth the way for a more thoughtful personality who sees the economic opportunities ahead and etches in a constructive role for government in fostering the progress...

...Hypocrisy: The President's yelps over the deficit and the national debt have been a career preoccupation since his General Electric huckster days: Yet despite the ranting he will be the undisputed King of the Debt Mountain, adding some 60 per cent to the total when his term expires...

...The duration and cost of our economic malaise, not to mention the real ingredients of a solution, have largely escaped media discussion...

...The Reagan Administration, with the nefarious Kemp-Roth sponsors, have given us a reverse Robin Hood: The ultimate (approximate) 23 per cent tax cut tilts heavily toward the affluent...

...The Federal Reserve, in its posturing and mock heroics, nurtures the creed...

...he has deregulated business in ways affecting the environment, toxic waste disposal, health controls, and mislabeling...

...As revenue needs develop, the same lackeys will tout the miracles of regressive excise and consumption outlay taxes...

...He has arrested many Federal programs...

...His tax winners will even try to dress him up as a Presidential aspirant...

...David Stockman spoke vividly about the pigs feeding at the trough...

...Apparently the business was to be left to the Mafia...

...We can be certain Kemp will surface again, to sow confusion...

...My view is that this is about four-and-three-quarter years too long...

...The President never seemed to perceive that more currency was printed because it was wanted, that you and I had more income and desired to hold more pocket cash...

...White House reporters, perhaps even necessarily, tend to cling to every vacuous utterance by the President and his equally inept advisers, spreading the misunderstanding widely-especially since the ingratiating man at the top has long ceased to separate fact from the mess of casual gossip in high places...

...Yet the sordid stagflation events date only to about 1969, the Nixon years...

...The President's chief economic adviser, Martin Feldstein, has always regarded Social Security as an abysmal drag, intimating that we would be better off, and more civilized, if our older citizens emulated the lemmings...

...All of its weaknesses notwithstanding, modern communication, nuclear power, the airplane, space exploration, radar, and much of our medicine would be in the dark ages today without the encouragement and support of government...

...Reagan is only the most recent political patron saint, with interference being run by Kemp-Roth...

...It has even earned him a Congressional reputation as an economic wiz...

...The previous two decades were a most spectacular era...

...Utterly forgotten is Roosevelt's undim-med optimism on jobs, that one way or another they would be created...

...there are more rational modes of stabilizing the economy...

...Nonsense, and malicious nonsense...

...And yet, most if not all of this could proveephemeral...

...The President has been deluded about our history and, in the process, he deceives us...

...Given the pervading philosophy of economic pessimism, and the profound platitudes concerning scarcity, doom and past mistakes-Always served alongside a portrait picturing government as our enemy-there is good reason to be optimistic about the next swing of the pendulum...

...Safiring' the economy has been a very predictable outcome...

...Let me explain my seemingly harsh descriptives...

...Real income grew2.5 times...

...His unreflective superficiality has ushered in the tragic economic consequences derived from the premise that business would prosper and expand, without inflation, if only the Federal Reserve clogged the money pipes and escalated interest rates...

...Maybe Vice President George Bush, as a 1980 Presidential candidate, hit it best by tarring the whole approach with "voodoo-ism...

...His deficits, likewise, place him at the head of the pack...

...Herein are the seeds for a massive housing shortage, sociological distress, further deterioration of our transportation network, deferring our toxic waste and health needs, and failing present and future generations by thinning educational pipelines...

...To be sure, the national dialogue over deficits will be vapid until politicians learn to separate operating from capital expenditures, and to admit Federal Reserve culpability, along with deficit size, in interest seizures...

...The substantive issues, though, reside elsewhere...

...It is frightening to think of the national calamity if FDR had not shoaled up the economy by deposit insurance, Social Security, and the abandonment of the gold standard-the very acts deplored, one time or another, by the present ideologically 19th-century President...

...Barbarism: There is an archaic immorality about cushy Washington officials urging unemployment to "discipline" labor and "to fight inflation...

...Still, you may ask, is there not some ray of sunshine in the media romance with Mr...

...Some queer ducks have been appointed to high office, and some puerile moral issues have enabled the President to swagger in righteousness, as befits an actor posing as a social philosopher...

...There was a production explosion: consumers were deluged with autos, TVs, washing machines, food, air travel, etc...

...At $200,000 Kemp-Roth carved out a tidy $50,000 lulu...

...Clearly he has sped up the arms race...

...Maybe we will even rediscover the art of choosing leaders who are prepared and reflective...

...The Big Lie is truly that "government can do nothing...

...At $10,000 adjusted taxable income, a sum of $230 will be pocketed...

...Reagan, having led us into the recession pit, emulates Hoover in counseling patience and faith in the same market miracles that gave us the Hoover, and today the Reagan, debacle...

...He was incredibly naive in believing that he could talk the Federal budget into balance, and that his tough cowboy talk would cause a Russian collapse...

...The assertion is true only of a do-nothing government...

...New York Congressman Jack Kemp's razzle-dazzle disguised his pitch for his rich cronies as a surefire extravaganza for plant modernization and a new industrial boom-in amazing disregard of interest rates, idle capacity, inflation, and monetary policy...

...Splrituai Gloom: Reagan, unable to recall anything quotable from Harding or Hoover, is fond of invoking FDR...

...Worldwide, our ragged stride bears strong onus for the over 30 million unemployed among our Western friends...

...To immortalize the infatuation, while removing the odious connotations of recessions and depressions, they might be renamed "safires...

...inflation-fighters...

...Although Ronald Reagan's recent predecessors gave a shove to the cause of economic squalor, the greater degradation belongs to his first two White House years...

...The unemployment, so comfortably endured by the President, entails a GNP income and output loss of $200 billion-$500 billion, depending on the extrapolation...

...It is difficult to assess the Reagan economic policy at midterm without searing the page: Boobery, barbarism, spiritual gloom, the Big Lie, naivete, complacency, hypocrisy, reverse Robin Hood-All spring to mind...

...Now as then, an exuberant White House theology extols some indiscernible recuperative powers of an unaided market economy...

...Nevertheless, they will continue to inflict misery, devastate lives and spell lost output .Condoning joblessness has its parallels in praising tortures practiced on others, or asking the band to drown out the shrieks from the torture chamber...

...Absurd, too, were the many declarations that to stop inflation the government should "stop printing money...

...It is even possible that a 1984 Presidential candidate may escape the economic prisons of the old textbooks...

...FDR radiated hope and cheer as he sought to lead us out of the Depression wilderness...

...Smiling Nice Guy...

...New York Times columnist William Safire, the resident universal genius who always rationalizes that "the Democratic Party does it too" when his ideological troupe is caught red-handed, has been euphoric about unemployment as an inflation antidote...

...Recently, he has espoused the view that it will take five years to shave unemployment by a few points...

...There also is a streak of cruelty on high in the requests for private charity to grab the slack in aiding the suffering...

...The market system gains no strong attachments from the Reagan fiasco...

...The Big Lie : We repeatedly hear the canard that Reagan was elected to repair the "mistakes" of the last 40 years...

...Clearly these are not the typical media adjectives...

...Those who prescribe the therapy should be the first to enter the ranks of the Sidney Weintraub, a regular contributor to the NL, is Professor of Economics at the University of Pennsylvania...

...He must be implored to recoup our glories, and our noble times, not to undo them...

...This is another besotted case of the Destroy-to-Revive Fantasy exemplifying a crude Humpty Dumpty economics...

...If we try hard-say, take a week off as President Eisenhower felt he had to do to search for some contribution of his Vice President Nixon-At best we can trace several negative scores for Reagan...

...But do it we will...

...The flattening of our progressive income tax is likely to be the most durable legacy of the Reagan years: Income grabs are always the focus of conservative power-plays...

...We rose to awesome world economic, political and military status...

...Economically, the Destroy-to-Re-vive Fantasy seems destined to ride out another one or two cycles as solemn men in power, who have not had a new thought for a quarter-century, pontificate that there is no other way...

...Complacency: This Administration has a capacity to tolerate other people's income misfortunes with an equanimity unparalleled in the politics of the last half-century...

...Most fancifully, he actually spoke of reducing the absolute dollar magnitudes of government expenditure-but for 1984 they should run at least 35 per cent above the last Carter figures...

...Boobery: Current policy victimizes 12 million unemployed, while the Administration boasts that the appalling misery is laying the groundwork for future recovery...

...The tax cut will save nothing for an unemployed person...

...It is likely to fade away as our afflictions force us to think more keenly about what kind of people we are, what we want of government, how intent we are on pellmell nuclear destruction, or on being singed by our own myopia on waste disposal...

...Heroism should be rewarded by a spot at the head of the troops...

...In short, we face the test placed before practically every generation, the Lincolnesque question of whether you can fool most of the people most of the time...

...We should be spared the homilies about a balanced budget amendment, for the Administration's sputtering carries the moral conviction of a cult leader renouncing sex as he seduces all his flock...

...In the light of the economic morass, we probably can discount the public relations flutter about a Reagan Revolution...

...Naivete: Reagan really thought that business would bounce ahead once his Presidency, his tax favors and his deregulation stance were announced...

...Population jumped about 75 per cent...

...But there is...

...But the reality is that the Reagan years are already the worst of times, judged by the last 40 years, the period the President ordinarily isolates for his own blasphemy...

...Reverse Robin Hood: Retaining qualms about due process, most of us can identify with Robin Hood's succoring the poor by drawing spoils from the rich...