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tax and spend

The Tax and Spend Liberal Myth

For approximately the last three decades, the above expression has been bantered about by conservative right wing pundits, with reference to members of, and supporters of, the US Democratic Political Party. Consequently let us take a look at, from the records, Democratic administrations taxing and spending policies as compared to Republican administrations doing the same.

In order to give an exact history (of taxing and spending), it would be necessary to go through the entire congressional records for the past 50 some years and post all statistics. If anyone reading this article prefers to do that, let me know when you plan to release the multiple volumes of that study. Since there is not enough space in this article for that to occur, a few highlighted examples and general historic trends will have to suffice.During the WWII administrations of Roosevelt and Truman (both democrats) the top marginal income tax rate was 68 percent. During the Republican Eisenhower administration, whom few would call a liberal, it rose a whopping 91 percent. During the sixties and seventies through the mixed party administrations of (Kennedy, Johnson, Nixon, Ford, Carter) it stabilized at around 70 percent.  In fact John Kennedy, a democrat, was the first to lower taxes on the rich.
Remarkably, these were periods of growth in the American economy and middle-class prosperity grew, as well as that of the rich. (1) There did occur, a major economic downturn during last part of the Carter administration which can be attributed to an inflationary cycle which the government had no control overEarly in the Reagan administration tax rates on the rich were lowered. But due to the fact that as time went on (the economic downturn continued) the desired result was not achieved by lowering taxes alone. Reagan, being more of a conservative pragmatist than ideologist, worked with a democratic congress to substantially revise the tax code. Together in a bipartisan manner, they eliminated many loopholes making it (the tax code) a much more simplified and efficient system. This included raising some taxes, which were conveniently labeled as “revenue enhancements”. A fairly balanced approach on taxation continued through both the Bush Sr. and Clinton administrations and the economy continued to grow and expand. However, Bush Sr. became famous for his comment “Read my lips, no new taxes” which unfortunately turned out not to be true. As you can see from the above, up to this point in time taxing of individual incomes was fairly balanced between republicans and democrats, and a democratic president (Bill Clinton) even left office with a government revenue surplus.

The Bush II republican administration did however fulfill the conservative’s dreams by lowering taxes, especially on the rich. The tax rate on capital gains was reduced to fifteen percent, which allowed many of the rich, especially hedge fund managers to claim all or most of their income in that category rather than as income, (which it actually was). (2)

Starting in the same time frame as we did with taxation, historical records (3) indicate that spending during the Eisenhower administration was not much different from earlier times with the exception of the passage of the interstate highway bill. Many historians also note that Eisenhower was reluctant to increase defense spending, especially pay raises for military personnel, due to the fact that he himself was retired military, and felt that it would indicate favoritism by him toward the military. There were no major attempts to do away with or privatize social security and other spending programs established earlier. Spending did increase during the Kennedy and Johnson administrations with the establishment of the Peace Corps, Medicare, the Vietnam War, and the great society bills. During this time frame there was no great protestation by rational conservatives about this spending. With regard to spending during the Nixon administration information indicates the establishment of the Environmental Protection Agency and continued spending on the Vietnam War. My sources reveal scant information on the Ford and Carter administrations as there were no basic changes taking place.

During the Reagan administration, spending on the military increased substantially (4) while the social security system was revised (in concert with the democratic congress) to make it more financially solvent and in line with the increasing age of the populace. This was also a period when the national debt did increase substantially (mostly due to military spending). During the Bush I administration no significant changes in spending occurred aside from spending for the First Gulf War. During the Clinton administration significant spending cuts did occur. The welfare reform, done in concert with the republican House of Representatives, was significant, and along with other cost cutting measures had President Bill Clinton declaring the “The Era of Big Government is Over”.

This brings us to the final and last administration with regard to the spending issue, Bush II. To start with, two unpaid for wars, not kept in the government accounting ledger, along with an unpaid for prescription drug program for the elderly. Another interesting subject, “earmarks” pork barrel spending.  For information on this we will need to go back to the Clinton administration and 1995 when Republicans took control of congress. In 1995, there were a total of 1,439 earmarked items passed by congress. In 2005, just before the democrats retook control of congress there were 13,998 earmarked items costing a total of $27.3 billion (5). Tax and spend liberals?  See below chart.

Now for those of you who would like to make the claim (based on current right wing propaganda) that the current democratic administration is on some sort of wild spending spree I submit the below bar graph for your consideration.  To read the full story behind the graph click here.
Now, let’s take a close look at the word liberal and see what it really means. Webster’s New Collegiate Dictionary defines the word liberal in several different ways. However, the words and phrases, “generous, openhandedness, not bound by authoritarianism or orthodoxy, favoring individual rights”, occur on a regular basis. Recent psychological research by John Jost in his book, “Political Psychology” and other researchers such as Stanley Milgram and Bob Altemeyer also provide interesting information. That information concludes that conservative (especially the hard line right wing conservatives) have an authoritarian (ideological or dogmatic) type of personality  or way of thinking, as opposed to the liberal thinking person, who is more of a freethinker and attempts to use rationality, critical analysis, and scientific research methods as problem solving tools. I’m limited by the space of this article from going into more detail about this research but I do have available a bibliography of reading materials for anyone who desires.Now I will be the first person to say that all folks claiming to call themselves liberals are liberals in the above defined sense. Examples would include some of the tree hugging environmentalists who set fire to housing projects that they feel are encroaching on their sacred trees, and torch car dealerships in protest to the carbon emissions potential. These folks are just as ideological as their right wing counterparts and would not be considered liberals.  By the same token all conservatives are not pure ideologists. I consider the following conservative individuals to be intellectually honest and even though I disagree with them on many issues, they do utilize reason and research to arrive at their conclusions. The list would include David Frum, George Will, and the late William F. Buckley Jr.  The politicians list would also include Senator John McCain, who was by the way, savaged by Rush Limbaugh as a RINO* during the 2000 Republican presidential primary campaign season, and more recently had to sound very conservative (even right wing) in his last senate primary campaign with the tea bagger Hayward.  What I really have a problem with, are the hard right folks, as author John Dean calls them in his book of the same name “Conservatives Without Conscience” such as Rush Limbaugh, Sean Hannity, Glen Beck, Laura Ingram, and Ann Coulter among others. The information that they put out on the broadcast waves and in their books, is inaccurate, slanted toward their ideological point of view, and sometimes even outright lies (6). Tax and Spend Liberal is not the only bogus term these right wing nuts have come up with. They also use such ones as “Partial Birth Abortion” (no such medical procedure known) and “Creation Science” (no such science).

In conclusion, we can then say, that the historical record indicates no great difference in the tax and spending policies of either republican or democratic administration with two probable exceptions. The first exception would be the spending by the Johnson administration on the “Great Society” programs. The second exception would be the Bush II tax cuts, two unfunded wars, and the unfunded elderly prescription drug program. AND: We have finally defined the term “Liberal” accurately and properly. We can therefore (not by ideology or dogma, but by rational analysis) conclude; that the “Tax and Spend Liberal” is indeed a Myth.

If you will notice in the body of this text, I have included some numbers in parenthesis (1), (2) etc.  These numbers indicate a bibliographical source which is available upon request by e-mail or otherwise.  I also have a rather lengthy bibliography of sources available on this, and many other political subjects, which may be requested.
*= Republican In Name Only

Gene Gerth is currently retired from Active Federal Service. Chair of the Pusan City Chapter and EXCOM member of Democrats Abroad ROK. He is the former 8th Army Moral Welfare and Recreation Division Entertainment Director and Adjunct Assistant Professor at the University of Maryland’s University College Asian Division.



About Gene Gerth

Retired US Army, Retired Eighth Army Entertainment Director, Former Adjunct Assistant Professor - University of Maryland University College Asian Division, Busan City Chapter Chair - Democrats Abroad ROK

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