In an afterword to the Mandate for Leadership titled Onward!, Edwin J. Feulner recounts the history of the Heritage Foundation’s influence on the federal government. This influence began with the presidency of Ronald Reagan and the publication of the first edition of the Mandate for Leadership.
Feulner writes: “First published in January 1981, the original Mandate served as a conservative plan of action for the Reagan Administration, providing much of the blueprint for the Reagan Revolution.”
The Reagan Revolution and Its Legacy
What was the Reagan revolution? It entailed many things. Among them was a distrust of government, especially the federal government. The Reagan revolution also involved a significant change in economic policy.
In a speech, Reagan famously said: “I think you all know that I’ve always felt the nine most terrifying words in the English language are: I’m from the Government, and I’m here to help.” Reagan also famously said: “government is not the solution to our problem; government is the problem.”
Humorist P. J. O’Rourke has put it this way: “The Republicans are the party that says government doesn’t work and then they get elected and prove it.”
The irony of a government leader such as Ronald Reagan denigrating the very institution that he became a part of grew into something truly wondrous and strange. As recounted in the Huffington Post, President Barack Obama noted: “I got a letter the other day from a woman. She said, ‘I don’t want government-run health care. I don’t want socialized medicine. And don’t touch my Medicare.'” Even more succinctly: “At a town hall meeting held by Rep. Robert Inglis (R-SC): Someone reportedly told Inglis, ‘Keep your government hands off my Medicare.’” (Medicare is a government program. Currently, about 67 million people depend on Medicare for their healthcare coverage. Project 2025 would drastically reduce Medicare and Medicaid benefits.)
Contrary to Reagan’s assertion, the U.S. government has a long list of solved problems or accomplishments aside from Medicare. They include helping win World War II, the federal highway system, the G.I. bill, the moon landings, affordable housing (for some, for a time), decades of prosperity and upward mobility, environmental protections, safe food and drugs, and much more.
Distrust of the government was not the only feature of the Reagan revolution, but historic events coinciding with Reagan’s campaign contributed to popular acceptance of Reagan’s assertion that the government was untrustworthy. The war in Viet Nam and revelations about the CIA, among other things, had fostered distrust in the government.
Another area of distrust was that the government’s long standing economic policy no longer seemed to be working. During the 1970s—prior to Reagan’s election—the post-World War II run of prosperity stalled as a new economic phenomenon called stagflation took hold. The Keynesian economic model that had dominated government policy for decades did not seem to be capable of addressing stagflation. Reagan offered an alternative: supply-side economics, which held that cutting taxes and especially cutting taxes on the rich and large corporations would lead to greater investment, thereby stimulating the economy. This major change in economic policy was another part of the Reagan revolution.
Although there is no record of Reagan ever saying that the newfound additional wealth of the already wealthy would “trickle down” to the less wealthy, that promise became associated with Reaganomics. Reaganomics also touted deregulation as a means to stimulate production and thus employment, along with increased defense spending.
Critics of Reaganomics took issue with each facet of Reagan’s economic plan. To start, increased defense spending may be considered an inefficient way to stimulate the economy compared to spending to increase the production of consumer and public goods. Once made, for example, a car will require insurance, maintenance, and other downstream spending, while on the other hand a tank, once made, is likely to simply sit around and require minimal maintenance until it is needed. Thus, government spending to increase production of consumer goods may be seen as a better way to stimulate the economy than spending on weapons. As President Dwight D. Eisenhower, a former general, put it:
“Every gun that is made, every warship launched, every rocket fired signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed.
This world in arms is not spending money alone. It is spending the sweat of its laborers, the genius of its scientists, the hopes of its children. The cost of one modern heavy bomber is this: a modern brick school in more than 30 cities. It is two electric power plants, each serving a town of 60,000 population. It is two fine, fully equipped hospitals.”
Next, the promise of supply-side economics that tax cuts would stimulate the economy, and that they would thereby pay for themselves as increased economic activity would lead to increased government revenue, has not come true. Instead, those who have benefitted from tax cuts have for the most part kept their money rather than spend it. The wealth has not trickled down, the rising tide has not lifted all boats, and tax cuts have increased deficits rather than reduce them.
As for deregulation, that too has been seen to increase profits for the investor and owner class but has not been shown to consistently help the middle and lower classes. Nevertheless, conservatives have continued to advocate for Reaganomics regarding deregulation. Deregulation and lack of enforcement was also a significant factor in the economic downturn of 2008. Writer Les Leopold, in his book Wall Street’s War on Workers, points out that the culture of deregulation and the belief that a corporation’s sole purpose is to make profit for its shareholders has led to mass layoffs, debt-financed takeovers of businesses and subsequent stripping of assets, legalized stock manipulation (for example via buybacks), decreased union membership, increased disparity between CEO and worker pay, and the rise of contingent labor, all of which have adversely affected workers. Reaganomics helped Wall Street but hurt Main Street.
Feulner writes: “The conservative movement had found in Ronald Reagan a President who shared that vision … .and [who could] convincingly show [people] how those ideas could work for the benefit of all.” To give Reagan credit, he was largely successful in convincing Americans that his economic policies would benefit them. Whether those policies actually did, however, is another story, one that continued through successive presidencies to the Trump administration. If Project 2025 comes to pass, Reaganomics—also known as neoliberalism—will once again be the order of the day.
