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To: sandeep who wrote (81499)	3/16/2001 12:57:38 PM
From: Les H	Read Replies (1) \| Respond to of 436258

you had much faster spending under Carter's four years concordcoalition.org appears to be about a 70% increase in outlays. the debt surged since: (a) Congress was unwilling to make the cuts Reagan proposed and the slower budget growth continued from the higher Carter baseline (b) unemployment surged to 11% to squeeze out the high inflation and cut into SS/Medicare tax receipts (c) Reagan budgets had to incur the high interest costs of 14-15% from 1981-1983 and which gradually worked down from there over the rest of the decade all in all, legacy of Carter-Democrat budgets are reflected in the budget deficits. they also enacted some of the wildly big single-year SS benefit increases of 15-20 percent in the 70s and greatly increased the beneficiary classes in the SS/Medicare/Medicaid programs, which were later paid for by Reagan/Bush proposals for FICA tax increases. The Democrats giveth and the Republicans payeth.

To: sandeep who wrote (81499)	3/16/2001 1:02:34 PM
From: flatsville	Respond to of 436258

increasing spending wildly is not a supply side argument. Well, you're missing the point. Supply-side economics, even without the runaway (defense) spending (which many of them believed it would allow,) would not have worked. theatlantic.com Just a taste, but you really have to read the whole article. ...Stockman himself had been a late convert to supply-side theology, and now he was beginning to leave the church. The theory of "expectations" wasn't working. He could see that. And Stockman's institutional role as budget director forced him to look constantly at aspects of the political economy that the other supply-siders tended to dismiss. Whatever the reason, Stockman was creating some distance between himself and the supply-side purists; eventually, he would become the target of their nasty barbs. For his part, Stockman began to disparage the grand theory as a kind of convenient illusion--new rhetoric to cover old Republican doctrine. "The hard part of the supply-side tax cut is dropping the top rate from 70 to 50 percent--the rest of it is a secondary matter," Stockman explained. "The original argument was that the top bracket was too high, and that's having the most devastating effect on the economy. Then, the general argument was that, in order to make this palatable as a political matter, you had to bring down all the brackets. But, I mean, Jemp-Roth was always a Trojan horse to bring down the top rate." A Trojan horse? This seemed a cynical concession for Stockman to make in private conversation while the Reagan Administration was still selling the supply-side doctrine to Congress. Yet he was conceding what the liberal Keynesian critics had argued from the outset--the supply-side theory was not a new economic theory at all but only new language and argument to conceal a hoary old Republican doctrine: give the tax cuts to the top brackets, the wealthiest individuals and largest enterprises, and let the good effects "trickle down" through the economy to reach everyone else. Yes, Stockman conceded, when one stripped away the new rhetoric emphasizing across-the-board cuts, the supplyside theory was really new clothes for the unpopular doctrine of the old Republican orthodoxy. "It's kind of hard to sell 'trickle down,'" he explained, "so the supply-side formula was the only way to get a tax policy that was really 'trickle down.' Supply-side is 'trickle-down' theory."... ...That regret was beyond remedy now; all Stockman could do was keep trying on different fronts, trying to catch up with the shortcomings of the original Reagan prospectus. But Stockman's new budget-cutting tactics were denounced as panic by his former allies in the supply-side camp. They now realized that Stockman regarded them as "overly optimistic" in predicting a painless boom through across-the-board tax reduction. "Some of the naive supply-siders just missed this whole dimension," he said. "You don't stop inflation without some kind of dislocation. You don't stop the growth of money supply in a three-trillion-dollar economy without some kind of dislocation . . . Supply-side was the wrong atmospherics--not wrong theory or wrong economics, but wrong atmospherics... The supply-siders have gone too far. They created this nonpolitical view of the economy, where you are going to have big changes and abrupt turns, and their happy vision of this world of growth and no inflation with no pain."...