With little more than 100 days until the 2024 presidential election, the economy has been one of the most important topics on voters' minds. The media and advocacy groups often paint the two party's economic policies in black and white: socialism vs. capitalism, tax cuts vs. tax raises etc. There is also much talk of the past in campaign rhetoric. Particularly, Donald Trump often speaks fondly of Ronald Reagan during his rallies, which raises the question: how did Reagan handle the economy, and what similarities can we draw to Trump's plans? In short, there are very few similarities, and I would go as far as saying that if Reagan were still alive, he would refuse to vote for Trump. However, this topic requires an in-depth analysis to draw some meaningful conclusions.
Before making comparisons, it is important to acknowledge the vastly different economic times that the two presidents took office during. Reagan took office in January of 1981, on the tail end of unprecedented stagflation partly catalyzed by record-high oil prices following the Iranian revolution in 1979. In the wake of the high inflation, then Fed chair Paul Volcker raised the Federal Funds Rate target to as high as 20% (for context it was 0% between 2008 and 2020.) Trump on the other hand came into office on the back of more than five years of uninterrupted economic growth, fueled by record high government spending following the 2008 recession.
Given this context, we can start to compare their policies. Reagonomics, as Reagan's economic policy is often called, was predicated on the ideological shift from Keynesian demand-side economic policy to neoclassical, free-market, monetarist, supply-side policy. Milton Friedman and Joseph Stigler of the "Chicago School of Economics" provided the ideological fuel for this shift. This new approach to economic policy was centered around the sanctity of free markets and limited government. Reagan's interpretation of this larger ideology consisted of deregulation, balancing the federal budget, opening immigration, and free trade, amongst other goals (these policies were closely aligned with those espoused in Friedman's Capitalism and Freedom.) You may be wondering: are we talking about the same Republican party?
Indeed, most of these policies are antithetical to Trump's track record of economic policy (even if he may praise some of these policies in his rhetoric, the facts of his presidency tell a different story.) Where Reagan was central in the establishment of the World Trade Organization (WTO) and the lowering of tariffs, Trump centered his policy around raising tariffs for Chinese imports to historic highs and withdrawing from NAFTA. Where Reagan balanced the budget, Trump oversaw the third biggest deficit increase of any president in US history (a trend that was developing even in the years before COVID-19-related stimulus.) Where Reagan supported immigration (as noted in his farewell speech), Trump repeated his slogan of "build the wall", engaging in one of the most anti-immigration presidencies ever. Where Reagan engaged in tax cuts for the highest and lowest tax brackets, Trump cut income taxes for the highest earners while simultaneously decreasing corporate taxes - a change that disproportionately benefitted the wealthy. Where Reagan increased funding for government provided health insurance (medicare), Trump rolled back the Affordable Care Act (better known as Obamacare), directly causing 4.6 million Americans to become uninsured.
This is not to say that the two presidents' policies were diametrically opposed - there are many non-economic policy similarities that I have not noted - , rather, specifically the economic side of their platforms had serious differences. This isn't fundamentally problematic - parties and their accompanying rhetoric evolves as the political and social context surrounding said parties evolves. What is problematic, however, is the way in which Trump acts as if he is emulating such policies. By today's standards, many of Reagan's policies would be considered moderate. Trump's policies, on the other hand are anything but that. To act as if the two are in harmony is dangerously misinforming to voters, especially in an election cycle where the economy is such a central issue. However, Trump has never been one to stick to the truth, so the best a conscious citizen can hope for is that voters take matters into their own hands, critically analyzing Trump's claims and comparisons for verity.
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