Reagan and Obama: Champions of necessary tax increases

Columnists often lift quotes from political speeches to illustrate the point they’re trying to make. I’ve done it myself many times — it’s an excellent way to add emphasis to what you’re writing.

RONALD+REAGAN.jpgHowever, keeping the quote in context isn’t always easy. A case in point, David Moon’s column in Sunday’s News Sentinel. In the April 24 column, Moon used a quote from President Barack Obama to draw a contrast between Ronald Reagan’s tax reform policies and the current president’s financial reform policies.Obama+Tax+Cuts.jpg

The Obama quote — from a speech just about a year ago — has been widely repeated by the president’s political opponents who want to paint him as a socialist. Unfortunately, the quote is often taken out of context.

Here’s how Moon used the Obama quote:

Ten years later a Republican carried 49 states in the 1984 election. Ronald Reagan’s vision of tax reform included a 44 percent reduction in the top rate. His version of free market capitalism was dubbed “Reaganomics.”

Twenty-five years later, Obama’s version of financial reform is predicated on the fact that “at a certain point you’ve made enough money.”

It’s true, Obama uttered those eight words in exactly that order.

But reading those word in context leaves the reader with a different impression. Here’s how Obama used the widely quoted phrase:

We’re not, we’re not trying to push financial reform because we begrudge success that’s fairly earned. I mean, I do think at a certain point you’ve made enough money. But, you know, part of the American way is, you know, you can just keep on making it if you’re providing a good product or providing good service. We don’t want people to stop, ah, fulfilling the core responsibilities of the financial system to help grow our economy.

Doesn’t sound very socialist to me.

It’s fair to contrast the policies of presidents. But boiling down policies to a single phrase is risky.

Take Reagan, for instance. The late president is generally considered a champion tax reformer, as Moon points out. However, it’s important to note that Reagan raised taxes multiple times during his eight years in the White House, including corporate tax hikes, higher payroll taxes for Social Security and Medicare and an increase in the gasoline tax. After slahing taxes when he came into office, subequent tax increases were necessary for economic stability.

Reagan also increased taxes when he was governor of California, including a historic $1 billion tax increase in 1967. A tax increase was necessary to deal with the massive budget mess he inherited from the previous governor.

Reagan didn’t like talking about his record as a tax hiker, but he knew what many of today’s most conservative politicians don’t seem to understand — sometimes it’s necessary to raise taxes.

And he had the political courage to tell extremists in his own party when they were wrong.

Photos: Knoxville News Sentinel archives