one of the comments to the CEPR piece on rattner that hits the nail on the head (so to speak, lol).
written by Dryly 41, December 11, 2013 1:28
Would someone teach Steve Rattner what caused the massive increase in the Gross Federal Debt since 1981?
In 1946 The Gross Federal Debt amounted to 121.7% of GDP. Each post WW II president, especially Truman, Eisenhower, and, Kennedy/Johnson, reduced it to a very acceptable 32.5% of GDP.
Then came Ronald Reagan with "supply side" economic tax cuts primarily for the wealthy. In the December 1981 issue of the Atlantic, William Greider quoted Reagan's Budget Director David Stockman admitted that "supply side" war really a "Trojan Horse" to reduce the top rates of the progressive tax system. In his book Stockman called "supply side" a "crackpot economic theory and "fiscal knownothingism". George H.W. Bush called it "Voodoo Economics".
But Reagan did it. Budget deficits in each of the Reagan eight years increased the Gross Federal Debt from 32.5 of GDP to 53.1%. Four more years of deficits under George H.W. Bush increased it further to 66.1% of GDP.
Clinton increased taxes, had 4% unemployment, balanced budgets, and, reduced the Debt to 56.4%
Bush II had two rounds of "supply side" tax cuts in 2001 and 2003, eight more years of budget deficits, and, increased the Gross Federal Debt to 85.1% of GDP. In addition, he presided over the collapse of our entire financial system after Lehman Bros. filed for bankruptch on September 15, 2008 leaving a crippled economy.
In 1983 Reagan signed a FICA payroll tax increase to create a surplus which working men and women have been paying since. As of December 31, 2012 the Social Security Trust Fund had a reserve of $2.6 Trillion dollars.
Social Security did not contribute one thin dime to the Debt. "Supply side" tax cuts favoring the wealthy like, well, Steve Ratner caused the massive increase in the Debt.
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