Remembering Ronald Reagan

I have mentioned former President of the United States Ronald Reagan in passing a number of times in my blogs. Today I gave him his own President Ronald Reagan page at IIIPublishing.com, where I will have a list of pages that mention him. Ronald Reagan was an important American President who held office when I was just starting to practice political science. Here I am going to give some of my impressions and memories from the Reagan era without trying to be objective or even fact-check to see if my memory serves me correctly. Which is probably appropriate for writing about a President who probably suffered from the early stages of Alzheimer's disease while in office.

I considered myself a leftist revolutionary back in 1980, although I was involved in no leftist organizing that year (I was writing a novel that would never be published). Although the 1970's were not as turbulent as the 1960's, there were still a lot of Americans attracted to revolutionary ideas. Living near Berkeley, California, talking to people in People's Park, I knew Ronald Reagan had ordered the police to shoot at a crowd of protestors, resulting in the death of James Rector on May 15, 1969. I thought of former Governor Reagan as a sort of fascist, a potential Mussolini or Hitler.

I moved to New York City in 1981, in time to see the results of the Reagan Revolution. The streets filled up with homeless people. They were of three sorts (not including the homeless who had already been there). Some were the normal economic casualties of the 1982 recession, which took place because the Federal Reserve raised interest rates to extraordinary levels to try to stop inflation. Unemployment was over 10%. In addition many factories in the midwest closed down; families of people in cars would show up in New York City, and across the nation, looking for work. The third class of people in the streets were mental patients. Ronald Reagan cut federal funding for the mentally ill. Hospitals responded by dumping them into the streets.

Needless to say, I did not have a high opinion of Ronald Reagan. His 1981 tax cuts (passed, of course, with the support of the Democratic Party as well as the Republican Party), did not help me, and I saw no reason to lower taxes on the rich.

But I have to say this for Ronald Reagan: he was no fascist. Anyone with a lot of power may seem to be a fascist at times, but on the whole Reagan was a man who reduced the control of society by government. This did lead to the rich having more power and income, and the workers having less power and income, but it was not centralized or totalitarian in character.

The closest America has come to a fascist regime was under President-For-Life Franklin D. Roosevelt. I'll write more on that in a later essay.

Within the central portion of the spectrum of American politics (and keeping in mind that my true position is well to the left of that center), Ronald Reagan provided an antidote to an unnecessarily large, bureaucratic national government. Unfortunately he did that in a way that favored the most privileged members of U.S. society, which I opposed and still oppose.

In retrospect Ronald Reagan looks better to me mainly because things have gotten so much worse since that era. Much as President Richard Nixon seemed to be on the ultra-right at the time, but now would probably be denounced by even middle-of-the-road Republicans as a Communist, Ronald Reagan seems like a mild-mannered reformer. He did not get the U.S. into any big wars. He did spend on lot of money on the U.S. military that could have been invested domestically; I am not saying I agree with much of his policy. I am just saying that compared to the current crop of right-wing jackasses running for high office (yes, I am including Barack Obama as a right-wing jackass), he seems not so bad.

I'll go over the Reagan Era in more detail as time goes by. During the Reagan era I listened to Punk Rock, hung out with anarchists and organized against Reagan policies including the placement of Cruise and Pershing Missiles in Germany, worked as a paralegal and legal secretary, and lived my life basically unmolested by the U.S. government except when I was engaging in civil disobedience. We worried about the destruction of the ozone layer in the 1980's, but very few people were worried about global warming. About the time Ronald Reagan left office the old Marxist left in the United States went into near total collapse, allowing the anarchist trend to come to the forefront. Anarchism is about true freedom, not the freedom-for-the-rich of men like Ronald Reagan. So far it has not had much impact on modern America, but hopefully it will some time soon.

Barack Obama's Dividend Play

Barack Obama has played just about all his cards right so far in the Presidential Poker game. He sounded Progressive early in the game, thus winning the Democratic activist primary pot. But now it is an all-or-nothing game.

On economic issues Senator Obama wants people to think that the Bush regime hurt them one way or another. Just as Herbert Hoover was blamed for the Great Depression when it would have happened with just the same if Democrat Al Smith had taken office in 1929, George W. Bush and the Republicans are being blamed for all of the nation's economic woes. [The Republicans would do the same, of course]

Strangely (until you analyze the game) Barack Obama has endorsed one Bush economic policy, special low tax rates on dividends paid by stocks. John McCain endorses the Bush policy as well, but because the will be a Democratic majority in Congress, supporting Barack Obama is a better strategy for the ultra-rich whose income comes mostly from dividends.

There are some arguments for a low tax rate on dividends, but then there are arguments for low tax rates in any specific category. The basic argument is that the tax amounts to double taxation because corporations (sometimes) pay taxes on profits, and then dividends are distributed out of profits and taxed when passed out to individuals. But money is constantly taxed in our society as it moves around. The money paid to wage earners has been taxed in various ways before they receive it from employers, and it is taxed again when they spend it (sales tax, real estate tax, etc.). So the double-taxation argument is just sophistry.

The bottom line is that only rich people derive a significant proportion of their income from stock dividends. So a tax cut on dividends is a tax cut for the rich, and an increase mainly hits the rich as well.

When George W. Bush took office dividends were taxed like any other income to individuals, which meant the top rate was about 40%. The Bush Tax Cuts for the Rich reduced the rate to 15%. John McCain wants to retain the 15% rate.

Democrats in Congress say they want to reverse the Bush Tax Cuts for the Rich. So if they had their way, the maximum tax rate on dividends would end up around 40%. If McCain is elected they can put that into effect. They don't need to worry about a McCain veto. All they have to do is let the Bush tax cuts expire.

Barack Obama has proposed raising the rate to only 20%. Democrats in Congress would not want to defy a Democratic President, so they would have to pass a new law lowering the dividend tax rate to 20% (the lefty Dems could vote against it, since there would be plenty of Republican congress people to vote for it). The rich will be better off under Obama than under McCain, if this scenario plays out.

Why would Barack Obama want to give the rich a break? Because actually he is from the same economic school as Ronald Reagan, the Chicago School of free-market economics. Barack taught law, a necessary adjunct to free market economics, at the school for years. He is not progressive on economics, but he had to sound progressive to win the Democratic primaries.

Obama apologists (an annoying lot) will ignore the realities and say Obama wants a 20% tax on dividends, McCain a 15% tax, so vote for the Democrat.

Barack Obama and Sarah Palin

Citizens of the United States can't lose in the next election. Either we will have a non-white President, Barack Obama, or we will have a female Vice-President. Either would stand in contrast with centuries of white male dominance of American politics.

On the other hand, citizens of the United States can't win the next election. Unless they are already among the economic winners. Despite being a working-class woman who became Governor of Alaska almost by accident, Sarah Palin, even if she become President, belongs in the Chicago School of economics (free-market capitalist). Barack Obama, despite being a super-educated product of super-educated parents, one of African ancestry, actually taught law at that very Chicago School.

For those sophisticated enough to see beyond Presidential election cycle dog-and-pony shows, this is going to reinforce the most basic lesson in the politics of change in the United States of America. Winning civil rights for groups of people denied civil rights is simply not on a level playing field with economic justice. In the later half of the 2oth century a variety of groups had their rights recognized: African-Americans, Native Americans and other citizens not of European descent, women, the disabled, and homosexuals. That is a good thing. It was not easy. People struggled and quite a few people died getting these reforms.

But in 2008 we have less economic equality of opportunity, much less economic equality, than we did in 1950. There are women and minority CEOs; there is a black middle class. The new discrimination is economic. It is harder today to get out of poverty than it was in the 1950's, regardless of your sex or race. Schools are worse. Destructive cultural habits - drugs, alcohol, negative attitudes towards education and work - are more prevalent among the poor and working class.

The class system has ossified. Requirements for entering professions have been elevated. A college degree is not nothing, it creates opportunities that a high school degree does not, but in most cases to get a chance at a good job you need a graduate degree. The economics of staying in college and then graduate school are daunting even for students from highly-educated families; they are nearly impossible for those who have working class parents and received their early education in public schools.

Tax codes are fiddled with, but in the end the rich must be taxed in the United States. They are the only people with money. Here I do not mean the super-wealthy, I mean the people who have professional and management jobs as well.

The ruling class has not stopped ruling. They have just admitted blacks and women to the club. It is funny to see the partisan froth being whipped up. On the right Barack Obama, a man whose economics are nearly identical to Ronald Reagan's, is blasted as a Communist. On the left Sarah Palin is being called a Neanderthal for her views on abortion, even though she is the first working class person I know of ever to be nominated for the Presidency or Vice-Presidency.

As people go, thinking within the two-party, one ruling class system, I think all four candidates are decent people who would try hard to do a good job. Of the four I like Joe Biden the least because of his ties to credit card companies, but then someone has to pay for people to buy their political offices.

Just don't expect anything beyond the usual posturing once the election is over. The basic economic structure and tax structure will not change. Your status in life will depend mostly on the status you were born with. With great effort, you can prevent yourself from sinking further still.

The vast majority of incumbents will be elected to Congress, as always. Democrats who supported the Republican agenda when that buttered their bread, like Congressman Mike Thompson of California, will still want to eat buttered bread. The Democrats (presuming Barack Obama wins) will throw breadcrumbs to their constituencies. Environmentalists will get some tighter regulations. Women will get a few cabinet posts. Gun control freaks will see a few types of guns added to the banned list.

But the basic attitude of Barack Obama and crew will be: Don't ask what your country can do for you. Ask what you can do for your country. Don't expect Barack Obama or John McCain either to do anything about excessive CEO pay, the fact that capital gains can go untaxed for decades, the lack of sufficient federal dollars to include locally produced, healthy, organic foods in the free and reduced lunch program for public schools, or any other issue that will actually help those at the bottom get a chance at the having the economic privileges of those in the middle; or that would allow those in the middle the same economic privileges as those at the top.