CONFESSIONS OF A REAGAN DEMOCRAT
By Sy Schechtman
Long before I crossed the political Rubicon and entered somewhat fearfully into strange Republican territory I was being subtly conditioned to this drastic step by events along the way. There were positive events in the Great Society programs of Lyndon Johnson that heartened me, such as Medicare, which was solemnly promised as only a minuscule entitlement, historic civil rights legislation, education bills, and a general "war on poverty". Affirmative action I was dubious about, but I balked at the many years firmly entrenched Democratic Congress handing its staunch labor allies the economic keys to the kingdom by granting unemployment insurance benefits if strikes lasted longer then six weeks. Since labor unions were also solidly entrenched and well funded with union workers’ dues, it was no problem to withstand the six weeks without a company pay check and wait for the government dole. This was the beginning of the acceleration of the Welfare Society, always we thought a necessary accompaniment to aid to very poor people --part of the war on poverty-- but, in effect now an unwarranted acceleration in the redistribution of wealth, which was already proceeding apace with increasing taxes and the pernicious effect of "bracket creep", paying even higher taxes as a "reward" for moving up the economic ladder.
In effect, the traditional adversarial labor management balance became no contest, strikes were muted and really short "show " events, with labor always getting the large portions of its demands by an acquiescent management that knew it was no longer able to withstand what was in effect government backed labor demands after a respectable six week delay. In fact, even at the beginning of this era of the very benign pro labor stance Walter Reuther, a brilliant labor leader, was quoted as saying, perhaps off the record, that it was now the duty of sincere American labor leaders to crusade throughout the world to bring up the universal wage scale to American standards. Perhaps his plea was shining enlightenment, or maybe old fashioned pragmatism and prescience, fearful of what eventually did occur. We experienced some of this eventuality as it was unfolding on a brief Florida vacation in the early l970’s during one of the cyclical economic downturns of our economy. There was, surprisingly, no corresponding depression in automobile workers spirits, for the then current labor contract at General Motors –the bell weather of the industry at that time -- included many months of supplemental pay while being laid off due to recession! Hence Florida had more than it’s usual share of vacationers, many not geriatric or recently retired.
This "benign" neglect of economic reality soon led to the hydra headed economic monster combining the previously antagonistic forces of rising prices, higher wages and lagging jobs, and economic decline, and a new word for the language—stagflation. Wages kept rising because of increasingly successful union wage settlements, and this resulted in higher costs and prices which led to economic decline and large job loss in this country, and loss of competitiveness compared to foreign imports. And also a notable decline in the quality of American goods, and the market share of our products, especially in durable goods such as autos, television, and also cameras and electronics. Closing the door of an American car resulted in a hollow, problematic sound. Not the solid thump of the closing of a Japanese car door, a product which only ten years before one would only buy because of its cheapness and never could compare to the vaunted American product from the world wide preeminent manufacturing car center of Detroit.
Thus, as Reuther surmised, the American Labor movement’s success in the fifties and sixties led to its near demise later on, as foreign labor markets became increasingly attractive for both the production as well as the consumption of American merchandise. Wage standards in the "boondock" third world remained pathetically anemic, and American goods manufactured there remained very cheap and more and more resulted in the shift of American jobs to foreign lands with labels of origin that spelled more American joblessness even as increasing the store of our knowledge of previously unheard of exotic lands….. Belize, Myanmar, Kazakhstan, Uzbekistan . As well as closer to home foreign neighbors such as Mexico, Honduras, Guatemala, and even Canada. Thus we had the anomaly of stagnant economy, high unemployment, high taxes, very high interest rates, and inflation. Something aptly named stagflation, but called a "malaise" by President Jimmy Carter, who was clueless as its cause or cure.
Carter was also at a loss as to the hostage dilemma, a many month insult to our national honor. The Iranian government’s intransigence in refusing to free 52 American hostages held for many months in the United States embassy in Tehran was ended only with Reagan coming to power. After a final humiliation of an aborted rescue mission of American helicopters crashing in the desert in a vain and embarrassing display of our military ineptitude in action. And as soon as Reagan was inaugurated the Iranian government, probably as a good will gesture to Reagan, whose campaign speeches they thought indicated the bellicose threats "of that wild American cowboy", released all the hostages intact and unharmed. To the murmured displeasure of the Democrats, who spent many months officially investigating the finally discredited allegation by Gary Sick in his book that George Bush, soon to become Reagan’s vice president, had secretly been negotiating for the hostages release in Paris as a good will gesture if Reagan won. Something which Bush has always categorically denied.
By this time I had crossed that mythical Rubicon of political allegiance, grudgingly, defensively, but as Reagan my choice as the lesser of two evils. (Carter thou, I still thought did one good thing, the peace treaty between Egypt and Israel which still is holding up after almost 30 years.) Gradually Reagan’s response to unfolding events won my increasing support. And almost immediately this support was tested with the Patco strike—the Professional Air Transport Controller’s Strike. In Reagan’s view this was an illegal action—and also immoral-- as the air controllers were public employees who were forbidden to strike. Thus after a two day ultimatum by Reagan ordering them back to work was ignored Reagan summarily fired them all. This overrode the fact that this union was one of the few that had supported Reagan in the election and that many people, including myself, feared that the people who were hired in place of the fired air controllers would not be competent and crashes would occur. However nothing untoward happened, and a powerful if almost subliminal message was heard. A still, small almost inaudible but emphatic message implying that the era of aggressive unionism would be opposed and contained if possible. The PATCO Union lost its certification and eventually filed for bankruptcy.
Reagan’s main achievements were in foreign policy and how we should view our tax and fiscal policy as twin engines working in harmony to promote economic growth. On this latter front he employed a mix of two approaches at first derided by his liberal critics---supply side economics (tax cuts) and monetary restraint (initially high interest rates) working in tandem to bring about both economic stimulus and controlling inflation, two seemingly contradictory goals. As we have seen stagflation was the rule at the beginning of his first term----recession, high unemployment, and high inflation. Over a period of three years in office he succeeded in getting Congress( a Republican Senate for the first time in forty years, but still a Democratic House) to cut taxes 25 percent, with the top marginal rate going down even more; and significant reductions in estate and business taxes. Also "bracket creep" was taken into account. Each year tax tables were adjusted taking inflation into account, so it would no longer push people into higher tax brackets and force them to pay higher rates without a corresponding increase in their purchasing power. Also he strongly supported the work of Paul Volker, a Carter appointee, who Reagan reappointed in l982. Volker raised the Federal Funds rate up to 20%, which caused much temporary pain but decisively broke the inflationary spiral; over a period of time interest rates became a much more normal 8%. And the economy took off. Over a period of five years Gross National Product (GDP) almost trebled, 18 million jobs were created and unemployment shrank to about 5.6% of the labor pool, just about where it is now. And the deficit, which had increased considerably due to the tax cuts became a smaller percent of the GDP in relative terms because of the large growth in tax receipts as the GDP almost trebled due to the enhanced economic growth.
But in absolute terms the deficit certainly was much larger because it took a few years for increased revenues to kick in. And also, most importantly, military spending increased dramatically as Reagan and his aides confronted the growing threat of the "evil empire", the Soviet Communist colossus that had spread beyond eastern Europe and into North Africa, in Ethiopia, Angola, Yemen and the Sudan, and brazenly invaded Afghanistan l982, the year Reagan became President. This ominous Soviet Russian expansion obviously far over reached the détente policies of "live and let live" of the Nixon-- Kissinger era that Carter was vainly pursuing, and Reagan determinedly went well beyond budgetary constraints to oppose this most serious threat. He was convinced that only if the Soviets were convinced of our utter resolve to oppose their expansionist aims would they cease, desist, and change course. The ultimate test, the supreme showdown, came in western Europe in October l983, when we countered the Russian installation of their SS-20 intermediate range missiles (with London and Paris in their gun sights) with the threat of deploying our newly perfected Pershing and cruise missiles if they did not remove their already placed weapons.
As the date for the scheduled deployment of these missiles approached "Reagan the war monger" was vilified world wide. More than 2 million people demonstrated in London, Rome,
Stockholm, Vienna, Paris, and other European sites against this upset of the present imbalance leaving the Soviet superiority in place. Prominent politically in the protest was the "Green Party" in France and Germany, stressing the environmental hazards that could result, and many American sources joined in the tumult and hysteria that backed this pro Soviet hysteria. But the center did hold; western leaders who stood with Reagan’s firmness such was Helmut Kohl of Germany and Margaret Thatcher of England were reelected and the American missiles were installed. Thus the high tide of Soviet expansionism was contained and the atrocity that was the communist system began to recede. This was the most signal victory of the cold war and soon after, once deprived by Reagan’s determined confrontation of their aggressive, bullying posture the Soviets began slowly to implode, almost before our incredulous gaze. First there was perestroika, under a new order style leader, Mikhael Gorbachev, which was supposed to reform the absenteeism, alcoholism and indolence in the work place, but when this failed minimal financial incentives were also trickled into the mix. This too was not enough. No one but Reagan knew that all the air was being let out of this gigantic gas bag that was the Soviet Union edifice. At that time his clarion call was "Mr. Gorbachev, tear down that Wall", referring to the wall that divided Berlin into eastern(Soviet) and western(American) zones---and most still thought Reagan was continually overstepping the realities of normal diplomacy by his unrealistic and offensive posture. But shortly after he left office in l989 the wall did come tumbling down and Russian communism, that "evil empire" that had enslaved and killed millions of dissidents, was nearing its utter and complete demise. Leaving in the dustbin of history that famous Nikita Khrushchev remark, banging his shoe on his is desk in heated defiance at the United Nations in 1962 and triumphantly proclaiming "We will bury you!"---referring, of course, to western capitalism and especially the United States.
Critics of Reagan’s tactics insist that the fall of the Soviets was inevitable; internal rot and despair made this a foregone conclusion. But the only person who seemed to know this at the time was Ronald Reagan and he acted accordingly, firmly opposing their aggression and expansion. Every one else avoided these confrontational tactics, and deplored "that western cowboy’s" simplistic approach so that the "inevitable" collapse, if ever, could have been years or even centuries away. The Ottoman Empire,--the sick man of Europe-- a heterogeneous complex of people, existed for centuries before unraveling into its diverse components. That the Soviet Russia disintegrated literally before our eyes without a shot being fired or an American live lost is certainly the miracle of the 20th century. Against a regime just as much a threat to the United States and the world as Nazi Germany. And costing us no human blood, only dollars that can be replicated by free human effort.
So far, so good. I was very happy across the political Rubicon into Republican land. There were a couple of uncomfortable epilogues, however. Of course they always present themselves and can not be completely buried. And they only temporarily dimmed the luster of the events already described. One was the Iran Contra affair in which we sold, covertly, arms to moderate Iranian factions in hopes of influencing official Iranian policy, and then diverting the proceeds of that money, also secretly, to pro American forces (contras) in Nicaragua fighting the existing pro communist government( Sandinistas). This latter action ---involvement in the Nicaraguan civil—had been declared off limits by Congress. Reagan took full responsibility for the sale of arms but denied any knowledge of aiding the contras, and became known as the Teflon President for being completely absolved in the illegal mess of aiding the contras, who finally did triumph in a legal election in ousting the leftist Sandinistas. (My feeling then was perhaps Reagan was lying about this illegal diversion of money and that he should have known that this was going on. But then I was comforted, though somewhat guilt ridden, by the fact that perhaps the good end result of the Contras coming to power justified the dubious means involved along the way).
Another political religious dilemma was the Bitburg entanglement. In l985 Reagan was invited to speak at a ceremony at a small German cemetery marking the fortieth anniversary of World War II. This site, Bitburg, unbeknown to Reagan at the time of his acceptance had about 50 of Hitler’s notorious Waffen SS, prime movers in the murder of the Jews in the Holocaust. When this became known there was much pressure to cancel the trip or at least change the venue of the event. Elie Wiesel, in a famous Rose Garden press conference urged Reagan to back out of the trip, "your place, Mr. President, is with the victims." Reagan however kept his promise to Chancellor Kohl, who had stood by Reagan in the crucial deployment of our missiles opposing Soviet ballistic weapons in l983. During that Bitburg visit Reagan also spent time at the Bergen Belsen concentration camp to placate the opposition somewhat and made speeches deploring the past atrocities that murdered six million Jews. But he kept to his main goal, to affirm his support for the new Germany forty years after the destruction of its bestial Nazi heritage.
Once again he was the Teflon President—and great communicator—in the face of much dissent, sticking to what he thought right in the face of much opposition, and prevailing in the estimation of his countryman, then and now, as attested to in the memorable national week of mourning at his death just concluded. He kept "winning one for the Gypper", and for his country, all the time.