Talk:Reaganomics

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This article was nominated for deletion on May 12, 2006. The result of the discussion was speedy keep.

Contents 1 NPOV 2 ? Bait and Switch ? 3 GNP tripled 4 Economics itself is "Voodoo" 5 Criticism 6 Laffer Curve 7 REDIRECT's 8 The 1981-82 Recession, to be more precise 9 Flat tax 10 Friedrich Hayek 11 Really, really bad article 12 too many off-the-cuff polical remarks!! And what about oil? 13 Oil and Reaganomics 14 Quote 15 Increased Tax Revenues 16 increased revenues and tax hikes 17 NPOV 18 Job Growth link goes to Vote for Democrats - spam??? 19 Reagaonomics in Reagan's words 20 10 year cycles 21 Critique of "Support for Reaganomics" 22 boondocks 23 Please do not interpret raw data 24 Explanation of Reaganomics? 25 I'll try that again

[edit] NPOV

From the introduction, right down to the close, this article is center-right. However, there are some questionable implications.

• there are some alternate points made in the article Trickle-down theory and in its discussion.
• The introduction is a little simplistic and right-leaning. Heck, I'll say it: manipulative /(rhetorical).
• It should be pointed out that Reagan broadened the tax base and shifted taxes toward regressive.
• More needs to be said about monetary policy and its affect. How did supply-side and monetary policy work together.

Agreed, in particular the phrase "and his economic theories eventually led to a strong recovery" in the introduction makes a huge assumption about causation that cannot be proved. Peyna 20:45, 17 November 2005 (UTC)

[edit]  ? Bait and Switch ?

And can someone hash out this: it has been suggested that any/all beneficial statecraft upon the economy was mainstream monetary policy and had little to do with supply side econ. That Paul Volcker solved stagflation through monetary policy, not supply-side econ, or a regressive tax cut. Reagan marketed supply side as a trojen horse for regressive taxes and when the monetary policy improved the economy, Reagan et al said it was the supply side economics that did it (bait and switch). To summarize; Reagan knows the economy is going to improve despite a minorly adverse regressive tax cut - so he calls the regressive tax supply side economics and says that supply side economics will solve stagflation. Stagflation goes away, as a result of monetary policy, but Reagan et al say "see, we were right, our regressive tax solved stagflation!".

[edit] GNP tripled

It should be mentioned that the Reagan Administrations's tax cuts resulted in that the US GNp nearly tripled while RR was in office. - Peter Perlsø 13:42, 2004 Apr 1 (UTC)

Update: I must have written the above while I was drunk. The GNP nearly doubled, but it was the state debt that tripled. - Peter Perlsø 10:59, 10 October 2006 (UTC)

[edit] Economics itself is "Voodoo"

Not only has it been called "the dismal science," it has been called a number of things that cannot appear in Wikipedia. Some people seem to think that "supply side economics" began with the Regan administration. Nothing could be further from the truth; it's been around in one form or another almost since John Stewart Mill. Whether it (or ANY theory of economics works) is open to debate; there are entirely too many variables, a fact which is illustrated by the relative success of microeconomics and the disappointing track record of macroeconomics. F. Lee Horn

[edit] Criticism

This is an absurd article that shoud either be cut or rewritten with some meaningful content. A worthwhile article on Reaganomics would

It is my recollection that the recession was caused largely by high interest rates which the Fed imposed to clamp down against inflation. It was my sense that the inflation, which was a problem during the Ford administration, had a lot to do with the fiscal policies of Johnson and Nixon, who did not want to raise taxes to pay for the war and instead borrowed and printed money. Nixon relied on price controls to manage inflation (so much for a free market) and when price controls were lifted, inflation worstened. I think others did blame the recession on Reagan, but perhaps because they felt that his cutting taxes, rather than spurring growth, were tied to cuts in federal spending which impeded growth. I am not saying that this is actually what happened -- I am neither an economist nor a historian. I would certainly welcome an article on Reaganomics that explored all these issues seriously. But the current article is silly and lacks NPOV -- SR

[edit] Laffer Curve

Additionally, there is both an explaination of, and a link to the Laffer Curve contained in this page. The Laffer Curve information on this page should be merged with the Laffer Curve page. -- Octothorn Your information is not entirely correct regarding the cutting of taxes and federal spending...in 1986 the 'Tax Equity and Fiscal Responsibility Act (TEFRA) was enacted which required Congress to limit spending to whatever was recieved in taxes...and as usual they did not comply with this requirement...remember, the Democrats were in charge of the purse then and although they passed Reagans economic tax cut plan, the deficit grew in part, because of their irresponsible increased federal spending...and remember, there has never been a time that the federal budget has gone down...The principles of Reaginomics are sound but require restrain, especially whehn the fderal coffers begin to recieve more revenue from the tax cuts

[edit] REDIRECT's

Rather than supply-side economics redirect to Reaganomics, Reaganomics should redirect to supply-side economics. Reagan did not develop the idea. The idea was devised before Reagan by Bob Mundell and Art Laffer. Kingturtle 21:12 May 3, 2003 (UTC)

[edit] The 1981-82 Recession, to be more precise

The recession started in the summer of 1981 and ended in 1982, so a more precise term would be the "1981-2 recession", and this page should note that it did not start after Reagan's economic policies were in place but before they were passed/signed into law.

Another critical point is to mention that the benefits of the tax cuts were not received until 1982, as they were not signed into law until the fall of 1981.

Reaganomics, as not quite Supply Side, should have its own page but link to Supply Side, etc.

Stupendous Man 04:18, 2004 Feb 16 (UTC)

[edit] Flat tax

Source information for Poland, Estonia, Latvia, Slovakia, Serbia, Romania, Georgia, Ukraine, Russia and Iraq using the flat tax: London Telegraph and Washington Post.

• Flat Tax in use world-wide

• Flat Tax System in Iraq

Nobs 15:52, 18 May 2005 (UTC)

[edit] Friedrich Hayek

There is not a single mention of Friedrich Hayek in this article. He was the intellectual counterweight to Keynes, and was the main inspiration to people like Margereth Thatcher and Milton Friedman. I would say he should have a prominent role in the article. Jacoplane 08:44, 12 September 2005 (UTC)

[edit] Really, really bad article

this is easily the worst wiki article i have read... the economic analysis is very weak and the article is poorly written... i'm only sorry i don't have the time to do a complete rewrite... 207.200.116.203 Dear God, I agree. --Karch 23:44, 29 April 2006 (UTC)

[edit] too many off-the-cuff polical remarks!! And what about oil?

How are lines like this helpful? The job growth under the Reagan administration was an average of 2.1% per year, while much better than most recent Republicans, was worse than every Democratic President from the last 80 years.

This article lacks organization and clearly has a political bias.

It would also be worth noting that oil prices went down during the Reagan era. Since the oil-shocks were cited as a cause for stagflation -- I think mentioning oil prices during recovery should also have some face-time.

[edit] Oil and Reaganomics

The drop in oil prices was mentioned in one of the "replies to this defense" paragraphs. Certainly oil prices play a role in every economy, but what role did Reagan's policy play in them? Price controls began with Nixon and Ford, and caused many of the problems. I'm not entirely sure what can be attributed to Reaganomics, but it would be worth investigating further.

[edit] Quote

--Also, in regards to this quote. "America astonished the world. Chicago school economics, supply-side economics, call it what you will — I noticed that it was even known as Reaganomics at one point until it started working [laughter] — all of it is fast becoming orthodoxy. It’s not just that Milton Friedman or Friedrich von Hayek or George Stigler have won Nobel Prizes; other younger names, unheard of a few years ago,bfgfhbbbbbbbngfjj are now also celebrated." from the first paragraph. I'm not sure how accurate that is. I hope that's a typo and not someone making an alzheimers joke.

[edit] Increased Tax Revenues

Removed this entry, as it was unsourced: However, Federal Government tax revenues from the individual income tax did not increase. The reason federal tax revenues increased in total was because scheduled increases in the Social Security Payroll tax occurred and after the 1983 Social Security rescue plan, the rate increases were speeded up.

For example, The Heritage Foundation Report in the External Links (1980s Section) argues that: The economy received an unambiguous tax cut only as of January 1983. Thereafter, personal income tax revenues climbed dramatically, increasing by more than 54 percent by 1989 (28 percent after adjusting for inflation).

[edit] increased revenues and tax hikes

um, are you kidding? Reagan raised taxes 6 times. Removing text like that seems to be apologetics, not effforts at neutrality.

Louisducnguyen 04:13, 15 March 2006 (UTC)

I did not make this statement. Very odd. I did remove the unsourced "fact" mentioned in the section above.

Louisducnguyen 02:56, 17 August 2006 (UTC)

[edit] NPOV

I think this article clearly has a political agenda. In the first sentence of the article, say what something is, not that it's 'flawed'. Statements I find are not neutral:

• "along with other problems caused by Reaganomics, have caused harm to the economy of the United States, even up to the present day"
• "Supply-side economics was created by no great minds"
• "it is composed of the half-baked ideas of reactionary politicians, journalists, and rejected economists."
• "So the group that Bartley assembled and promoted [the supply-siders] was something stranger and wilder than a mere collection of conservative economists; more like a cult or a sect than a simple school of thought."

Among many others throughout the article. Debate on the effectiveness of reaganomics should be left out of the explanation of what reaganomics is. Maybe a "critique of reaganomics section" could be added... I don't know.

Also, I find that this article is just in general very poorly written, maybe someone with a more objective stance could rewrite it.

Just do revert. Evidently someone who doesn't know that there is an NPOV policy attempted a rewrite. RJII 00:44, 8 May 2006 (UTC)

[edit] Job Growth link goes to Vote for Democrats - spam???

Check it out: (bottom of article)

The job growth under the Reagan administration was an average of 2.1% per year, which is in the middle of the pack of twentieth-century Presidents.

[edit] Reagaonomics in Reagan's words

In a July 10, 1987 White House Briefing for Members of the Deficit Reduction Coalition, Ronald Reagan said of Reaganomics: "America astonished the world. Chicago school economics, supply-side economics, call it what you will — I noticed that it was even known as Reaganomics at one point until it started working [laughter] — all of it is fast becoming orthodoxy. It’s not just that Milton Friedman or Friedrich von Hayek or George Stigler have won Nobel Prizes; other younger names, unheard of a few years ago, are now also celebrated."

Why does this quote keep getting deleted? At least let the guy himself have some input on what it's about or related to. RJII 07:29, 21 June 2006 (UTC)

[edit] 10 year cycles

Teh contrary viewpoint needs to have facts not a reference to an article and then attempts to manipulate the data using "10-year cycles". If this was true, then would liberals be arguing that the recession in the early years of 2000 was not Bush's fault... Please. The section reaks of POV and has zero sources. in addition, it is written in the advocate tone as opposed to an encyclopedic one. ER MD 07:35, 2 July 2006 (UTC)

Actually, the section you keep blanking has many sources. IrishGuy ^talk 18:19, 2 July 2006 (UTC)

also interesting in that "Replies to this defense" is written. Shouldn't it be more along the lines of critiques of reaganomics??? ER MD 08:02, 2 July 2006 (UTC)

I will rename it. IrishGuy ^talk 18:19, 2 July 2006 (UTC)

there is a reference to one article in 1996 which does not support the criticism in the first few paragraphs--sounds like original research. It need referencing otherwise, I will continue to delete since it is written in advocate fashion. You can state criticisms that are referenced. Not hocus pocus stats and then come up with unreferenced numbers. ER MD 20:44, 2 July 2006 (UTC)

In fact, there are references to four sources. They include the Cato study, the 1996 Economic Report of the President, Table B-2 in the 2005 Economic Report of the President, and recent census data. Regarding your complaint about sources and your charge that this section "manipulates the data", take a look at the sources and manipulation of data in the "Support for Reaganomics" section. I've done that in the following "Critique of the Support for Reaganomics" section. Lineman 02:51, 3 July 2006 (UTC)

[edit] Critique of "Support for Reaganomics"

Following is the text of the article section "Support for Reaganomics" in bold, followed by critiques of that text:

According to the Bureau of Economic Analysis, real economic growth averaged 3.6% during the Reagan years versus 2.8% during the Ford-Carter years and 3.1% during the Bush-Clinton years. (source)

If you download the sourced spreadsheet, you'll see that it simply contains the GDP percent changes per year since 1930 and the GDP changes per quarter since the second quarter of 1947. It makes no mention of "Reagan years", "Ford-Carter years", or "Bush-Clinton years". These appear to have been defined and calculated by the author. The author neither states exactly which years he is designating to each period nor whether he is using the annual or quarterly figures. In comparing the possibilities to the numbers that the author presented, he appears to be using the quarterly figures and defining the periods as follows:

AVERAGE ANNUAL PERCENT CHANGE IN REAL GDP

Period        Start    Stop   Years  Average
------------  ------  ------  -----  -------
Ford-Carter   1973q1  1980q4    8     2.83
Reagan        1981q1  1988q4    8     3.57
Bush-Clinton  1989q1  2000q4   12     3.13

The following table shows the averages per presidential term plus the averages for the double terms of Reagan and Clinton:

AVERAGE ANNUAL PERCENT CHANGE IN REAL GDP

                              4-year   8-year
Period        Start    Stop   Average  Average
------------  ------  ------  -------  -------
Kennedy       1961q1  1964q4   5.22
Johnson       1965q1  1968q4   5.09
Nixon         1969q1  1972q4   3.35
Ford          1973q1  1976q4   2.33
Carter        1977q1  1980q4   3.34
Reagan(1)     1981q1  1984q4   3.33
Reagan(2)     1985q1  1988q4   3.81     3.57
G.H. Bush     1989q1  1992q4   2.14
Clinton(1)    1993q1  1996q4   3.28
Clinton(2)    1997q1  2000q4   3.96     3.62
G.W. Bush     2001q1  2004q4   2.48

As can be seen, the average real GDP growth during the eight years of Clinton slightly beat the average real GDP growth during the eight years of Reagan. In addition, there was much higher real GDP growth under Kennedy and Johnson.

A study from the Cato Institute said, "Real median family income grew by $4,000 during the Reagan period after experiencing no growth in the pre-Reagan years; it experienced a loss of almost $1,500 in the post-Reagan years." (source)

For the pre-Reagan, Reagan, and post-Reagan years, the Cato study used periods of 7, 8, and 6 years. Presumedly, the pre-Reagan period included just 7 years to exclude the first year of Nixon's second term and the post-Reagan period included just 6 years because that's all the data that was available when the analysis was written in 1996. In any case, this claim about real median family income is addressed in the second paragraph of the article section "Criticism for Reaganomics" .

Laffer and Reagan were vindicated by the results of the Reagan tax cuts. Real per capita GDP increased at an annual rate of 2.6% from 1981 to 1989, after languishing at a 1.6% rate during the Carter years of 1977 to 1981. Citation: Louis Johnston and Samuel H. Williamson, "The Annual Real and Nominal GDP for the United States, 1789 - Present." Economic History Services, March 2004, URL : http://www.eh.net/hmit/gdp/

If one goes to this link, one simply finds a calculator that can give the Nominal GDP, Real GDP, GDP Deflator, Population, Nominal GDP per capita, and Real GDP per capita for any range of years between 1790 and 2005. The author appears to have taken the Real GDP per capita figures for the given years and calculated the average annual rate that would have given the same increase. The author chooses to compare Carter's 4-year period with Reagan's 8-year period and, based on those two numbers alone, claim vindication for Laffer and Reagan. A little additional research would have shown that there was a nearly as high 2.3% increase from 1993 to 2001 under Clinton. Shifting by one year and comparing the increase from 1980 to 1988 with the increase from 1992 to 2000 actually shows a slightly faster increase (2.48% versus 2.45%) in the latter period.

Reagan's supply-side model changed the paradigm of government involvement in the economy. Keynesian economists were at a loss to explain why the aggregate demand increases of the 1970's did not result in improved national economic performance. Likewise, they could not explain how to reverse the shift in the Phillips curve. The Reagan-Laffer-Volcker-Milton Friedman model of improving economic performance by reducing government involvement in the economy has since gained wide currency. President Clinton ran as a "New Democrat": fiscally conservative and trade-friendly. Estonia, Latvia, Slovakia, Serbia, Romania, Georgia, Ukraine, as well as Russia and Iraq have variations of the flat tax. Governor Bill Richardson of New Mexico cut personal income taxes in 2003 "to spur growth and investment". [1]

This entire paragraph is unsourced. The final link gives the message "We are unable to locate the page you requested".

The President Reagan Information Page [2] details numerous economic statisics from the Reagan era. Highlights include the reduction of inflation, poverty and unemployment; the increase in jobs, incomes and real wealth; increase in individual income tax receipts and overall federal receipts and an analysis of the Reagan spending proposals on the federal deficit.

This information may be somewhere on this site but neither the statistics nor obvious links to the statistics are evident on the given page. Hence, this paragraph is effectively unsourced. Lineman 02:51, 3 July 2006 (UTC)

[edit] boondocks

reagonomics is mentioned in the boondocks episode "The pasion of rev. Ruckus.

[edit] Please do not interpret raw data

This constitutes original research and is against Wikipedia policy. If you find a reliable source that assigns a particular interpretation to data then you can cite that, but make sure to represent the source's conclusions as its conclusions, not as ground truth. Gazpacho 02:12, 14 August 2006 (UTC)

Please give a link to the page that states that simple calculations using raw data, such as calculating the percent change between two numbers, constitutes "original research". That was the closest thing to original research in most of what you deleted. For example, following is one of the sections that you deleted:

However, Historical Table 1.3 in the 2006 U.S. Budget shows that revenues had likewise doubled (or better) during every decade since the Great Depression. They went up 506% during the 40's, 135% during the 50's, 108% during the 60's, and 168% during the 70's. At 96 %, they nearly doubled in the 90s as well. Furthermore, according to Historical Table 2.1, the receipts from individual income taxes (the only receipts directly affected by the tax cuts) went up just 91 % during the 80's. Meanwhile, receipts from Social Insurance, which is directly affected by the FICA tax rate, went up 141 %. This larger increase was largely due to the fact that the FICA tax rate went up 25% from 6.13 to 7.65 % of payroll. Reagan also signed into law six other tax increases from 1982 through 1987, (The Tax Equity and Fiscal Responsibility Act (TEFRA), The Highway Revenue Act, the Deficit Reduction Act of 1984, the Consolidated Omnibus Budget Reconciliation Act of 1985, The Tax Reform Act of 1986, and the Omnibus Budget Reconciliation Act of 1987). Hence, the increase in revenues in the 80s was no larger than other recent decades and a portion of that increase was arguably due to tax increases enacted during the Reagan administration, not from stimulus provided by supply-side cuts.

Regarding the first two sentences of this section, the following table contains raw numbers from Historical Table 1.3 in the 2006 U.S. Budget:

RECEIPTS IN CURRENT AND CONSTANT (FY 2000) DOLLARS

      Current  Percent  FY 2000  Percent
Year  Dollars   Change  Dollars   Change  Decade
----  -------  -------  -------  -------  ------
1940      6.5              75.3
1950     39.4    506.2    306.5    307.0    40s
1960     92.5    134.8    528.5     72.4    50s
1970    192.8    108.4    815.9     54.4    60s
1980    517.1    168.2   1028.3     26.0    70s
1990   1032.0     99.6   1309.3     27.3    80s
2000   2025.2     96.2   2025.2     54.7    90s

The second column gives "raw data" from the given source and the third column gives the "original research" from the second sentence of the deleted section. That original research consisted of dividing the second number by the first, subtracting 1, and multiplying by 100. That is, it was calculating the percent change.

In the case of this data, I've found a reputable source that does similar calculations and will add that to the article. However, I would still like to see a link to the page that states that simple calculations using raw data constitutes "original research". If that is the case, then much of the section titled "Support for Reaganomics" needs to be removed. As the above section titled "Critique of Support for Reaganomics" points out, the first and third paragraphs involve just such "original research" as they involve calculations and the selection of time spans by the paragraphs' authors. In fact, the third paragraph includes the original conclusion that "Laffer and Reagan were vindicated by the results of the Reagan tax cuts", apparently based on the author's two calculated numbers. In addition, the last two paragraphs in this section are essentially unsourced. However, despite complaints about "original research" in "Criticism of Reaganomics", nobody has yet responded to this critique of "Support for Reaganomics". Lineman 03:34, 21 August 2006 (UTC)

As I think I made clear, the original research comes in the interpretations and conclusions: "is directly affected by the FICA tax rate", "was largely due to", "was arguably due to...not from". If you want a conclusion about causes and effects to be in the article, find the most reputable economist you can who believes it and cite him. See WP:OR#Synthesis of published material serving to advance a position.

As for the support paragraph, when I scanned the article for possible OR the passages with several external links stood out visually, so those were the ones I removed. I have no objection to removing other OR passages. Gazpacho 06:56, 21 August 2006 (UTC)

I see your point. Although, some of the interpretations seemed obvious ("receipts from Social Insurance" are "directly affected by the FICA tax rate") or were stated in non-absolute terms ("was arguably due to"), they were interpretations, nevertheless. As long as this policy against personal interpretations is applied to all sections of the article, I have no problem with it. On that count, I was glad to see you apply it to the "Support for Reaganomics" section as well.

I'm still a little unclear as to what degree simple calculations (such as calculating the percent difference between numbers) is allowed. I would guess that it might be allowable for numbers that have already been mentioned in a sourced document. That is, the author can compare numbers but should not select the numbers to be compared. This avoids the problem of individuals cherry-picking numbers in order to make a point. Of course, the safest course would be to find a reputable source that already makes the calculations. If you are aware of any discussion of this matter, I'd be interested in reading it. In any case, thanks for your response. Lineman 05:28, 22 August 2006 (UTC)

I would say that if a source says that the relative change is significant to its conclusions but does not actually provide that number (which seems odd), it shouldn't be a problem to calculate that number from the same data the source used. Gazpacho 07:34, 22 August 2006 (UTC)

[edit] Explanation of Reaganomics?

Why was that article section removed? I thought it was the best part this entry. Louisducnguyen 14:04, 20 August 2006 (UTC)

Which explanation? What revision? Gazpacho 23:20, 20 August 2006 (UTC)

It looks like it was deleted by an anonymous user "205.188.116.73" on May 30, 2006. The article section is still on answers.com. http://www.answers.com/topic/reaganomics. Louisducnguyen 02:31, 25 August 2006 (UTC)

[edit] I'll try that again

I rewrote the article so that it 1)had sources 2)wasn't conservatively biased. It was accused of being anti-Reaganomics (which I'll admit it is, somewhat). So what's the problem with putting it as criticism of reaganomics? —The preceding unsigned comment was added by Don Brooks (talk • contribs) .

Don, please read the reply I gave on your talk page. It is very important that all Wikipedia articles retain a neutral point of view. Wile I agree that the article as it stands needs some work to achieve this, your edits have such a strong slant to them that they seriously degrade the quality of what is written. Please do not re-add them without discussing the specific changes you propose to make here first. Thanks, Gwernol 23:05, 1 September 2006 (UTC)

By definition a criticism has a certain point of view: an antagonistic one. That's what I've done. As for your threats: I'm not scared. There's no way to block me. Don Brooks 23:26, 1 September 2006 (UTC)

And number one in the "code of conduct" in the policies and guidelines it says to read is "be bold". That's what I was doing.

I don't think your definition constitutes an argument you'll find quickly accepted on Wikipedia. The text must not have a point of view, even while it is describing a critical point held by a citable source. Opinions are worse than useless in a Wikipedia editor. If we think we can tell what an editor's opinion of the subject was (whether we're right or wrong), that editor has not done their job successfully. Somegeek 19:34, 14 September 2006 (UTC)