Michael KreponSolvency, Show Biz and Security

A cunning rock ‘n roll showman, David Lee Roth, once opined that, “The key to success is sincerity. Once you can fake that, you’ve got it made.” Vice President Richard M. Nixon defended himself when he was struggling to stay on the ticket with Ike by calling attention to his family’s pet dog and his wife’s “respectable Republican cloth coat.” Those were the days when it was an article of faith for Republicans to equate security with solvency — sometimes unwisely. To maintain a balanced budget, Ike short-changed conventional forces and relied heavily on nuclear weapons for national security.

Times change. I remember wandering around D.C. during President Reagan’s inauguration week. My fellow citizens decided they had had enough of the Carter administration’s austerity and tentativeness. I felt stunned, not just by the loss of a job, but by the party goers’ ostentatious display of wealth. Washington was awash in mink coats and stretch limos. No apologies needed. Now the mink coats rarely come out of the closet, but the stretch limos have gotten longer. Both parties now thrive on the ostentatious display of wealth from their supporters while the country seeks deeper in debt.

My sense is that the Reagan years were a cultural as well as political watershed. One big shift, of course, related to the traditional Republican equation of solvency and security. The progressive tax code was bent to allow tax cuts for high-end incomes. Not surprisingly, commensurate cuts in government spending did not accompany losses in revenue. The Clinton administration accepted the thankless job of re-balancing the budget through revenue increases. A budget surplus resulted, and Democrats were then hammered as the Party of Taxation.

An old professor of mine, Robert W. Tucker, wrote:

The principal Reagan legacy in foreign policy may well be just this: that the nation’s 40th president transformed what had been a disposition not to pay for the American position in the world into something close to a fixed resolve not to do so.

The cultural aspects of the Reagan shift harkened back to the 1920s. A newspaperman who covered the Harding administration, Samuel Popkins Adams, wrote in Incredible Era, The Life and Times of Warren Gamaliel Harding, that “the country wanted an anti.” Harding was elected because he was so unlike his austere, demanding predecessor, Woodrow Wilson. Harding arrived in Washington “with little more knowledge than the average man in the street of the issues on which the world’s future was to hang… He was an actor, cheerfully responsive to the direction of the playwrights.”

Reagan was, of course, a far more accomplished actor and politician than Harding. He surprised both his critics and supporters by reducing nuclear dangers in heroic and historic ways. Reagan flummoxed wonks by demonstrating that a grasp of detail mattered far less than having sound instincts. Garry Wills, in Reagan’s America, Innocents at Home, explained Reagan’s political success this way: “Because he acts himself, we know he is authentic.” Reagan was, in Wills’ view,

… the great American synecdoche… He is just as simple and just as mysterious, as our collective dreams and memories… He is the perfect carrier: the ancient messages travel through him without friction. No wonder he shows little wear and tear… Reagan does not argue for American values: he embodies them… We make the connections. It is our movie.

When politics becomes indistinct from stagecraft, masters of fiction can be our keenest observers. Here’s E.L. Doctorow on Reagan (in “The State of Mind of the Union,” The Nation, March 1986):

The new attitude [of the 1980s] borrows something of the accelerated sense of life in the 1920s, when precocity and a daring irrelevance caught up young people as the stock market had their fathers. But there is something unrecognizable here: it is not a spirit of selling out because it lacks that moral reference entirely; it is a kind of mutancy, I think, a structural flaw of the mind that suggests evolution in a social context.

The “evolution in a social context” of American politics continues apace. The George W. Bush administration fought two wars with tax cuts. It’s hard to be secure when you are insolvent. And now my fellow Americans have elected another “anti.” Think of this: Barack Obama could never have been elected President without George W. Bush.

Comments

  1. abcd (History)

    What does this have to do with arms control and proliferation?

  2. John Field (History)

    Three cheers for the fascinating quotation from E.L. Doctorow.

  3. MarkoB

    The Kim Jong il personality cult I can understand. But the Reagan mania in the world’s most open country is much more difficult to understand.

  4. John B. Sheldon (History)

    @abcd – I’m sorry, but if you have to ask what an interpretation of the current political context has to do with arms control and proliferation then … wow …

  5. abcd (History)

    @ John B. Sheldon – pardon me for lacking your supposed sense of seasoned discernment, but it was an appeal for MK to be a bit more direct in his analysis for the benefit of the younger members of this audience, rather than writing an historical survey of post-Carter attitudes toward Reagan.

    Perhaps instead of being so haughty, you could do the extrapolation for me.

  6. Andrew Tubbiolo (History)

    Why the problem with Ike’s ‘overliance’ on nuclear forces to deter war in Europe? The experiment was conducted and in that time frame, the idea was sound. Think of how bad America’s finances would have been in the 70’s and 80’s if we had wasted money on conventional forces that have been experimentally verified as not needed? From my point of view the level of Western conventional arms in Europe tracked with the disposition of Western nuclear arms vs the arsenal of the USSR. Ike was the the wise leader that the Republican personality cultists try to turn Regan into. Heck 2/3rds of the American nuclear Triad still stand on Eisenhower hardware.

  7. John B. Sheldon (History)

    @ abcd: those who know me, including MK, would hardly say I possess seasoned discernment, even a sense of it. However, I will say that any discussion of arms control and proliferation, including any arms control or counter/non-proliferation negotiations, that have no sense or understanding of the political context in which those discussions /negotiations are taking place, are either meaningless, or worse still, highly dangerous. Politics is king in all things, including arms control, even if the interpretation of the political context is (necessarily and by its very nature) eminently debatable.

    You accuse me of being haughty on the matter. I won’t necessarily deny that charge. Why? Because, regardless of where you stand on the issue of whether ams control is a worthwhile endeavor or not, if you think that all of this is unrelated or tangential to politics then you should probably be looking for an alternative hobby or career.

  8. MK (History)

    abcd:
    I use the indirect approach because I think that more can be learned that way. But you make a fair request, so here goes: When it comes to arms control, analysis and detail matter greatly. But not as much as politics and money.
    MK

  9. MK (History)

    abcd:
    ps: also, I liked the shoebox quotes so much, I wanted to use them

  10. Andy (History)

    Austerity is coming back whether we like it or not. Recent testimony by the CBO director is sobering:

    A large and persistent imbalance between federal spending and revenues is apparent in CBO’s projections for the next 10 years and will be exacerbated in coming decades by the aging of the population and the rising costs of health care. That imbalance stems from policy choices made over many years. As a result of those choices, U.S. fiscal policy is on an unsustainable path to an extent that cannot be solved by minor tinkering. The country faces a fundamental disconnect between the services that people expect the government to provide, particularly in the form of benefits for older Americans, and the tax revenues that people are willing to send to the government to finance those services. That fundamental disconnect will have to be addressed in some way if the nation is to avoid serious long-term damage to the economy and to the well-being of the population.

    That strikes me as a polite way to say we’re heading toward national insolvency and to avoid it will require major tax increases combined with major reductions in government spending. Given that US conventional forces are much more expensive than the strategic forces, it’s conceivable that future policymakers, in the face of severe budget cuts, could favor strategic forces over conventional. On the other hand, both may lose big to help save entitlements. There are many possibilities, but what’s clear is that very difficult choices will soon be unavoidable.

    Many people highlight the Reagan years as when things changed, but I would place it ten years earlier when we began to run federal deficits every year. In fact, the deficits in 1975 and 1976 were about the same as those in 1987 and 1988 in terms of GDP or constant dollars. So I do think Reagan gave the ball a strong kick, but it was already rolling along nicely when he came into office.

    I disagree with you on one other point, which is the Clinton Administration. President Clinton did work to reduce the deficit but so did Congress and it’s Congress that writes the budget. The biggest factor, however, was greatly increased tax revenue caused by the tech bubble which allowed the President and Congress to avoid making any serious (ie. politically risky) budgetary changes. It’s important to note the federal budget continued to rise during the Clinton years, albeit more slowly than previously. The miracle of compound interest (40 years worth now!) works on debt as well as savings and is now so powerful that any future bubble won’t even provide the illusion of solvency we had under Clinton.

    The US could easily face the prospect of interest payments near a trillion dollars in 2020, which would make it the third most expensive government “program” after medicare and social security. That projection assumes, of course, that this fiscal house of cards called the US Government doesn’t crash before then.

  11. James (History)

    Andy:

    Your comments about the fiscal situation could have been made by a Russian economist in the early 80’s. The time for “difficult choices” is long past. What comes next are choices that are frankly unthinkable to most Americans, at least for the moment. What Russian could foresee, even as late as 1987, the withdrawal from Eastern Europe?

    With all due respect the abcd above, that is absolutely the concern of every armchair strategist. He might as well be arguing that the collapse of the Soviet Union had no arms control implications.

    I agree that the problems began before Reagan and that they actually had their roots in the 1960s. In some ways the US never really recovered from the Vietnam War. The costs of that war hung over the 70’s like a ghost, with consequences like the end of Bretton Woods to the new word “stagflation.” Reagan stabilized the system but did not really reform it and the consequence was the Permanent Deficit.

    Clinton may have benefited fiscally from the Tech Bubble but at least he had the wit to do so. We threw a housing bubble during the Bush years and all we have to show for it is this lousy bailout. Having been an adult through the 90’s I as shocked as anyone to learn that the Clinton years will go down in history as the Indian Summer of the American superpower.

  12. Scott Monje (History)

    Andy, James

    Following on the theme of insolvency and declining power: we now have China, modeling itself after past US behavior, threatening sanctions if the US continues to arm Taiwan. Given the degree of financial dependence on China, the US will be hard-pressed to respond in any way other than capitulation. That, of course, assumes that recent predictions of a coming Chinese collapse are incorrect. Otherwise, it’s even harder to see what’s coming.

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