Everything Wrong with the Reagan Administration

In a 1975 interview with Reason, Reagan insisted that he believed that “the very heart and soul of conservatism is libertarianism.” The former governor of California had taken to describing himself as a “libertarian” or a “libertarian-​conservative” and the editors at Reason were interested in what exactly Reagan meant when he used the term. When questioned, Reagan explained that “the basis of conservatism is a desire for less government interference or less centralized authority or more individual freedom and is a pretty general description also of what libertarianism is.” Reagan exhibited an understanding of the “shades” of libertarianism asserting that he did not agree with those who wanted “no government at all or anarchy.” Reagan insisted that he believed “there are legitimate government functions.” Sounding rather Lockean, Reagan explained that “some government” was necessary to “maintain freedom or we will have tyranny by individuals.” He continued that “we have government to ensure that we don’t each one of us have to carry a club to defend ourselves.” Reagan concluded that he believed that “libertarianism and conservatism are travelling the same path.” ²

The interviewers pressed Reagan further asking him to list some examples of the legitimate role of government. After listing national defense and the protection of individual rights, Reagan exclaimed that he did not “believe in a government that protects us from ourselves.” When pressed on issues of gambling Reagan said he went back and forth about whether that was a victimless crime. As for prostitution, Reagan cited public health and asserted he was opposed to decriminalization. When asked about censorship and pornography, Reagan said that he “didn’t want the picture industry doing it” but insisted he was “opposed to outside censorship” of the industry. Reason pivoted and asked Reagan what scholars had been influential to his “intellectual development.” Reagan responded that he was “an inveterate reader. Bastiat and von Mises, and Hayek and Hazlitt-I’m one for the classical economists.” ³

From reading the 1975 Reason interview, it is clear that Reagan had thought deeply about issues near and dear to libertarians’ hearts. Reagan was a deeply religious man (although he was not always the most active or visible Christian) and as such he found issues that dealt with sex, drugs, and licentiousness to be difficult issues to square. ⁴ Often, however, he came down on the side of allowing individuals to make up their own minds on how best to live their lives. In 1978, California state Senator John V. Briggs introduced Proposition 6, which would have repealed a state law that protected teachers who were gay from discrimination and granted school districts the ability to fire any teacher that supported homosexuality publicly. The Briggs Initiative ultimately failed, and Briggs placed the blame squarely on Ronald Reagan. Reagan opposed Proposition 6 explaining to Californians that it had “potential for real mischief” and that it would ruin “innocent lives.” ⁵ Once the initiative was defeated, Briggs exclaimed “that one single endorsement—Ronald Reagan—turned the polls around.” He added that “for Ronald Reagan to march to the drums of homosexuals has irrevocably damaged him … he’s finished as a national politician.” ⁶ Likewise, Jerry Falwell – who had traveled to California to campaign for the Briggs Initiative, asserted that Reagan had taken “the political rather than the moral route” and insisted that Reagan “would have to face the music from Christian voters” in 1980. ⁷

Despite Falwell and other members of the New Right’s frustration, they supported Reagan for president in 1980. They were dismayed, however, when he did not push socially conservative legislation once in office. Specifically, the Reagan administration did not spend a ton of political capital in the battle for a right to life amendment or the amendment to allow prayer in public schools. Fuming after being defeated, the socially conservative Republican Senator of North Carolina Jesse Helms condemned the administration asserting he did not “know of a single vote they obtained for us.” ⁸ Much to the agony of social conservatives, Reagan did not push their agenda. The closest he came to advocate for social conservatism was in appointing conservative judges, many of whom agreed with the New Right’s social agenda. ⁹

Reagan often gets blamed for not doing more to combat the AIDS epidemic, however, his administration did dramatically expand funding for AIDS and made it the department of Health and Human Services’ top priority. ¹⁰ Furthermore, Reagan appointed his Surgeon General C. Everett Koop to research and respond to the epidemic. Koop, who was a darling of the New Right for his views on smoking and abortion, enraged social conservatives by promoting an agenda of sex education to combat the spread of AIDS. ¹¹ Furthermore, Reagan rejected the more radical suggestions on how to address the crisis. Conservatives such as Phyllis Schlafly and Jerry Falwell were appalled that Reagan was not doing more to protect the nation from the AIDS epidemic. Conservatives launched a campaign to pressure Reagan into cracking down on homosexuals (the group primarily affected by the disease) and some even accused the government of “conspiring with the homosexual community to ‘cover up’ the epidemic.” ¹² It took Reagan until 1985 to speak publicly about AIDS and the president did not give a major address on the subject until 1987 when he called on the American people to show “urgency, not panic … compassion, not blame … and understanding, not ignorance.” Reagan asserted the importance “that America not reject those who [had] the disease, but care for them with dignity and kindness.” Reagan concluded his remarks by reminding the American people, “this is a battle against a disease, not against our fellow Americans.” ¹³ Although Reagan’s sentiment was laudable, the fact that the president did not use the bully pulpit of the presidency to address the seriousness of the AIDS epidemic sooner speaks to the culture of homophobia that existed in the 1980s and to the fact that Reagan was constrained by his domestic coalition.

One area that Reagan did pursue the New Right’s agenda was his escalation of the War on Drugs. He and Nancy launched the “Just Say No” campaign in 1982. It aimed to educate children about the dangers of illegal substances. The goal of educating America’s youth was no doubt a noble one, however, critics have claimed that the initiative did little to decrease drug usage, lumped all illegal drugs together, and may have actually increased mass incarceration. ¹⁴ Likewise, Reagan leveraged federal highway funding to force states to adopt 21 as the legal drinking age. Regardless of the intentions or the effects of this action, Reagan’s willingness to sign the National Minimum Drinking Age Act seemingly violated his view that government should not be in the business of protecting us from ourselves.

Ronald Reagan is remembered as an advocate of free market capitalism; however, the reality is a bit more complicated. When Reagan was elected, he vowed to cut taxes, balance the budget, and increase military spending. He ultimately succeeded in doing two of the three.

When Reagan took office, the US economy was struggling under what was known as “stagflation” – high unemployment coupled with high levels of inflation. President Jimmy Carter had appointed Paul Volcker as Chairman of the Federal Reserve and Volcker was determined to get inflation under control by raising interest rates. Reagan, having read Milton Friedman and others, agreed with Volcker’s approach and gave the Fed Chairman room to implement his monetary policy. ¹⁵ As expected, raising the interest rates sent the economy into recession and left Reagan with a low approval rating.

In order to combat the recession, Reagan drew on the theory of Supply-​side economics – the belief that tax rates could be so high that they discouraged businessmen and women from expanding thus decreasing economic growth and potentially cutting off potential revenues. As such, Reagan embraced the Kemp-​Roth tax plan, later denoted the Economic Recovery Tax Act of 1981 (ERTA). Reagan signed ERTA into law in July 1981. The act reduced the marginal income tax rate by 23 percent on top earners and provided significant reduction in taxes for businesses. ¹⁶ The goal of ERTA was to provide a stimulus to the struggling economy by rewarding business and entrepreneurial activity. Unfortunately, the tax cuts were phased in over three years and as a result the benefits were delayed. ¹⁷

For most of 1981 and all of 1982, the nation was in the midst of a recession. Unemployment increased and high interest rates stifled economic expansion. The deficit, which had been high during Carter’s final year in office, skyrocketed and Americans began to blame the president for runaway debt. Reagan had succeeded in cutting some spending in his first budget, but David Stockman, the Director of the Office of Management and Budget, was extremely frustrated with the bureaucratic inertia that pushed back against any meaningful cuts. Stockman found himself fighting with Cabinet Secretaries who were supposed to be carrying out the Reagan Revolution of decreasing the size and scope of government. Instead, the Cabinet Secretaries fought many of the important cuts. Ultimately, Stockman laid the blame for his inability to significantly cut spending on Reagan himself. In his memoir, Stockman lamented that only an “iron chancellor” could have implemented a fiscally responsible budget and “Ronald Reagan wasn’t that by a long shot.” ¹⁸

Of course, Reagan also faced the challenge of getting spending cuts through a Democratic House – something that would prove extremely difficult. As such, Reagan decided to seek additional revenues in 1982 by raising taxes. He and Speaker of the House Tip O’Neil held a press conference in the Rose Garden explaining the legislation. The image alarmed some of his most ardent supporters who viewed Reagan’s support for tax increases a betrayal of the Reagan Revolution. ¹⁹ Reagan explained to those who were concerned that “more than three-​fourths of the revenue raised comes from increased taxpayer compliance and the closing of tax loopholes.” Reagan would also maintain that O’Neil had promised him three dollars’ worth of spending reductions for every dollar in tax increases. A promise – if it was indeed made – that would not be kept.

Despite the tax increases, by early 1983 the American economy was beginning to rebound. Volcker’s hard medicine had tamed inflation and the Reagan tax cuts were now fully in effect. President Carter deserves some credit for appointing Volcker and for deregulating the transportation industry. Reagan built on Carter’s deregulations ending price controls on gasoline. Furthermore, Reagan further decreased tax rates and simplified the tax code when he signed the Tax Reform Act of 1986. ²⁰ The combination of sound monetary policy, tax cuts, deregulation, and increased military spending resulted in impressive rates of economic growth from 1983 through the end of the Reagan administration. Unemployment also began to decline as the American economy produced around 19 million new jobs from 1983 to 1988. ²¹

Although the Reagan economic record is impressive, critics have claimed that Reagan did little to end the flow of manufacturing jobs overseas and that his policies exacerbated income inequality. The main criticism of Reagan, however, is that his administration increased the national debt by 186 percent. Reagan’s insistence on dramatically increasing the defense budget (by around 35 percent) and his inability to decrease domestic spending led to an explosion of the national debt. During his administration the debt increased by $1.86 trillion. ²²

Another aspect of Reagan’s economic legacy was his ability to compromise with O’Neil to save Social Security. Although Reagan had denounced the federal government’s role in Americans’ retirements, he signed the Social Security Reform Act of 1983 that “increased the Social Security payroll tax, raised the retirement age for recipients to sixty-​seven, required federal employees to join the system, and placed taxes on the benefits of higher-​income recipients” ²³ Upon signing the bill, Reagan exclaimed that this “demonstrates for all time our nation’s ironclad commitment to Social Security.” ²⁴ On the one hand, Reagan could be praised for his willingness to compromise his principles and work across the aisle to save a program that most Americans supported. On the other hand, although Reagan and O’Neil made Social Security sustainable, their reforms kicked the can down the road. In 1983, Reagan – who was at least rhetorically committed to free markets – was presented an opportunity to attempt to privatize Social Security or fundamentally alter the system so it achieved long-​term sustainability. Instead Social Security continues to face long-​term insolvency and is one of the largest drivers of the debt.

All in all, the Reagan economic record is impressive. Although he failed to get a balanced budget amendment through Congress and the national debt increased dramatically during his presidency, the 1980s were a time of economic growth and technological advancement. Most importantly, however, was the way in which Reagan altered the American political discourse. Furthermore, the Reagan years forced the Democrats to adopt a more moderate and fiscally conservative agenda. In many ways, the 1990s were a conservative decade in which many of Reagan’s unrealized goals became law (welfare reform, a balanced budget, further deregulation etc). ²⁵

Many Americans today believe that Ronald Reagan won the Cold War perhaps as British Prime Minister Margaret Thatcher declared, “without firing a shot.” ²⁶ Likewise, many conservatives argue that Reagan’s tough language and massive increases in defense spending bankrupted the Soviet Union and led to America’s triumph. Although Reagan deserves credit for the Cold War coming to a peaceful end, his real contribution was not his bellicose rhetoric but rather his willingness to negotiate with Mikhail Gorbachev. Reagan ultimately deescalated tensions (that he had earlier in his presidency intensified) and gave Gorbachev the opportunity to implement reforms that ultimately acted as a poison pill to the USSR.

Reagan campaigned against détente – the policy of easing tensions with the Soviet Union implemented by President Richard Nixon and continued by President Gerald Ford. Instead, Reagan insisted that the United States was a morally superior nation and that the Soviet Union was destined for the ash heap of history. The Soviets had hoped that Reagan’s harsh rhetoric was a campaign tactic and they believed that he would moderate his language and his views once taking office. During his first press conference as president, however, Reagan declared that the Soviet Union reserved “the right to commit any crime, to lie, to cheat” to achieve the global communist revolution. ²⁷

The president’s rhetoric escalated tensions, as did the massive increases in the Pentagon’s budget. In response, Yuri Andropov – the chairman of the KGB – put his agents on high alert. Believing that the United States, under Reagan’s leadership, was actively preparing for nuclear war, the Soviets launched a global intelligence operation RYAN (an acronym for Nuclear Missile Attack in Russian) to collect information about any potential preemptive nuclear strike. ²⁸ Tensions between the Soviet Union and the United States continued to escalate into 1983, which would become known as the year of fear. He did this by announcing the Strategic Defense Initiative, calling the Soviet Union an “evil empire,” and continuing with the deployment of Pershing II missiles to Western Europe (where they would counter the Soviet’s SS-20 missiles).

Two events in 1983 significantly worsened superpower relations and brought the world to the precipice of nuclear war. The first occurred in October 1983 when a Korean airliner, KAL007, was shot down by the Soviets for straying into their airspace. The deaths of all 269 passengers including 63 Americans heightened tensions. The second occurred on November 7, 1983 when the United States and its NATO allies conducted military exercises designed to simulate the use of nuclear weapons. Able Archer, as the exercise was known, included major officials in governments across Western Europe. Although NATO had conducted such tests before, the added realism triggered the Soviet operation RYAN. KGB operatives came to believe that Able Archer was a cover for an American nuclear first strike. As a result, the USSR put all their forces on high alert. Oleg Gordievsky, a KGB agent at the time, recalls that “during Able Archer 83 [the world] had, without realizing it, come frighteningly close – certainly closer than at any time since the Cuban missile crisis of 1962” to reaching “the edge of the nuclear abyss.” ²⁹ Luckily, the exercise ended on November 11, 1983 without nuclear holocaust. Shortly after Able Archer, London sent information that described how the Soviets had believed that Able Archer could be a cover for a first strike by NATO against the USSR. When Reagan got this news, it rattled him. After being briefed, Reagan was “uncharacteristically grave” and asked his national security adviser, Robert “Bud” McFarlane: “Do you suppose they really believe that?” Reagan added, “I don’t see how they could believe that—but it’s something to think about.” ³⁰

As a result of Able Archer and other events of 1983, Reagan decided to alter his foreign policy course in 1984. On January 16, Reagan announced that he was prepared to resume negotiations with the Soviet Union. He labeled 1984 “a year of opportunity for peace” and added that he “was sincere in wanting arms reductions and peace.” ³¹ Reagan soon realized, however, that he would need a willing partner in the Kremlin to make any progress – he would get just such a partner in 1985 when Mikhail Gorbachev became General Secretary of the Soviet Union. Together, over the opposition of hard-​liners in both their countries, the two leaders developed a close personal relationship, established trust between the superpowers, and eventually signed the INF treaty which significantly reduced the number of nuclear weapons in each country’s arsenal. Reagan’s willingness to negotiate with Gorbachev established the foundation upon which a peaceful end to the Cold War would be achieved.

Although Reagan often bemoaned that American soldiers had not been allowed to achieve victory in Vietnam, he was reluctant to get US troops involved in foreign conflicts. Instead, he established the Reagan Doctrine which asserted that the US would provide assistance to those who were resisting communism in their countries. In reality this meant that the CIA would supply arms and money to insurgent “freedom fighters” in places such as Afghanistan, Angola, Ethiopia, and Nicaragua. In each of these cases it could be argued that providing US weapons simply intensified the conflict. ³²

The low point of the Reagan presidency came in 1986 when it was reported that the United States had sold weapons to Iran and then funneled some of the funds, in violation of an act of Congress that forbid such sales, to the Contras in Nicaragua. The Iran-​Contra Affair was a dramatic overstep of presidential authority and although it was never proven that Reagan was directly involved it significantly damaged his presidency. Ironically, Reagan had rehabilitated the image of the president following Nixon’s corruption and Carter’s incompetence. Iran-​Contra threatened that rehabilitation.

Perhaps Reagan’s greatest contribution to our political discourse today was his unflinching belief in immigration as a source of American greatness. Reagan signed comprehensive immigration reform in 1986 that granted almost 3 million people amnesty. ³³ In his farewell address, Reagan described the United States as a shining city on a hill: “It was a tall, proud city built on rocks stronger than oceans, windswept, God-​blessed, and teeming with people of all kinds living in harmony and peace; a city with free ports that hummed with commerce and creativity.” Reagan continued that “if there had to be city walls, the walls had doors and the doors were open to anyone with the will and the heart to get here.” ³⁴

Likewise, in his “Brotherhood of Man,” speech, Reagan spoke about his desire to see a world where the people of the globe lived in harmony. Reagan insisted that the US was “the one spot on earth where we have the brotherhood of man.” The former president declared that “if we continue with this proudly, this brotherhood of man [will be] made up from people representative of every corner of the earth, maybe one day boundaries all over the earth will disappear as people cross boundaries and find out that, yes, there is a brotherhood of man in every corner.” ³⁵ In the midst of the Trump presidency it is important to remember that an alternative Republican vision on immigration, trade, and general human flourishing exists. While Reagan’s policies were a mixed bag, he continues to provide timeless rhetoric that elevates the individual above the collective and preaches tolerance rather than exclusion.

What was wrong with the Reagan presidency? Well there was the ballooning debt, the legitimizing of social conservatives, and bringing the world to the brink of nuclear war – if unintentionally – in 1983. But perhaps the worst part about the Reagan presidency is that it has been misremembered, both by the left and the right. Reagan’s true legacy has faded from view and has been replaced by a myth that Reagan was successful because he never compromised his principles. Myths can either be constructive to a society or detrimental. The Reagan myth has driven conservative policy makers to put principle over pragmatism and has led them to make the perfect the enemy of the good. Perhaps a more realistic view of the Reagan years would enable conservatives to stay true to their principles while finding innovative ways to apply them to an ever-​changing world.