Back in the 1990s, there was this new phenomenon called “the internet.” It grew exponentially. Entrepreneurs saw the business potential for reaching more customers than they had ever dreamed they could reach through conventional methods. Consumers had more choices of every conceivable product – including information – than they ever had in history.
Like all technological advances, it produced big winners and big losers. Vast fortunes were made by those who built businesses that worked better on the internet. Vast fortunes were lost not only by those internet commerce replaced, but also by those who went long on businesses that didn’t work on the internet – Pets.com being the most infamous example.
The internet revolution was much like the industrial revolution in this respect. It advanced human flourishing in general exponentially but was decried by all those it damaged economically. Many brick and mortar retailers were put out of business, just as the automobile put blacksmiths out of business.
Legacy media faced annihilation. They were no longer the gatekeepers of information. The new generation of internet users had access to information from all over the world at the click of a mouse, including information previously filtered, spun, or suppressed by legacy media. There was a point at which those who had long decried its information gatekeeping and establishment propaganda gleefully counted down the days until the New York Times went bankrupt.
Governments didn’t like the internet much, either. Untaxable interstate commerce was replacing taxable brick and mortar commerce. Republican Congressmen lamented the internet was so new they didn’t know who to regulated it. And, of course, no government has ever liked the free flow of information. That’s why a First Amendment was necessary over two hundred years ago.
The current war on the free flow of information over the internet is led by the political left, but it didn’t start there. Long before conservatives were being deplatformed for opposing wokism, the political right was after internet publishers for criticizing the war on terror. Julian Assange is only the highest profile example. Online porn has also been targeted by the right since the internet’s earliest days.
As with laissez faire capitalism, it seemed like those who stood to lose had two choices: adapt or die. But there was a third choice: call in the government. And that’s just what all those who stood to lose did.
The decades-long destruction of America’s laissez faire free market was accomplished in much the same way.
“We’re a rich country, we can afford to…,” says your average liberal. Complete the sentence however you wish. “Guarantee every American healthcare.” “Guarantee every American a college education.” “Provide a home for an unlimited number of immigrants who require food, clothing, and shelter the moment they cross our borders.”
But how did the United States become so rich? No one ever asks politicians that one, simple question. Forcing them to answer it would be illuminating. The likely first answers would be vague references to “democracy,” but that doesn’t jibe with reality. If anything, America became rich in spite of democracy, not because of it. Most of the Constitution is devoted to checking democracy at every turn.
Eventually, politicians might get around to the “land of opportunity” narrative. And it is true that the United States offered native-born and immigrant Americans opportunity unavailable anywhere else.
Opportunity to do what?
It’s as if no one even wants to say it anymore. The opportunity offered was to pursue one’s individual self-interest, unmolested by and mostly free of the larceny of any king, commissar, or legislature. America became rich operating under Adam Smith’s principle of the invisible hand of the market, which says that people pursuing their narrow selfish interests in an environment where property rights are protected will do more good for society than people attempting to advance some “common good.”
It worked. It still works, to the extent it’s allowed. When people have the opportunity to keep the money they earn and dispose of it as they see fit, they produce more goods for others to consume. What they don’t spend on consumption becomes capital used to expand productive capacity and produce even more goods for others to consume.
This is what made America rich and built the modern, technological world we have the privilege of living in today. In 1888, at the peak of libertarian American society, the government collected about 3 percent of GDP in taxes and ran a 50 percent surplus. President Grover Cleveland fought a decade-long war during his nonconsecutive terms to reduce tariffs, saying government surpluses invited “mischief.”
Before the Progressive Era, Americans kept almost everything they earned and employed it in the pursuit of their own happiness, not some politician’s five-year plan. They invested in or entered new industries without licenses, unencumbered by regulatory agencies, free to innovate as they saw fit. Figuring out a way to provide more for your fellow Americans at a lower cost made you rich. Simply working hard and saving responsibly made you comfortable.
In a word, what made America the richest country in the world wasn’t free speech, freedom of religion, or the right to vote. It was capitalism, as laissez faire as it has ever existed anywhere, before, or since. The protection of property rights and relatively free markets resulted in an accumulation of capital we’re still benefiting from today. It didn’t fall from the sky. It was saved and invested by people pursuing their individual interests. That’s what works.
The culture war has been front and center for over a decade. Donald Trump’s election in 2016 was as much a reaction to it as it was about any of his policies. And the Biden administration’s war on MAGA is much more a war on its culture than against any credible threat posed by “white supremacists.”
Please.
There is no sense in fighting a war if one doesn’t know what one is fighting for and against. The right and left have different motivations and goals. At least the thought leaders on either side do. For much of the rank and file, it is purely a tribal conflict, with each side defending its banners and shibboleths.
It is important to understand that the left’s war on traditional culture is economically motivated. Breaking down cultural norms is a means, not an end. The entire school of critical theory was founded based on the realization there was not going to be a proletariat revolution due to economic conditions.
There was a very simple reason for this: the industrial revolution had made the proletariat much better off. Their real wages had risen and standard of living skyrocketed. It’s hard to generate the kind of anger necessary for a revolution among people who are doing better than they or any of their ancestors had ever done.
The founders of the Frankfurt School did not admit this to themselves. They were convinced socialism was a superior socio-economic philosophy and since empirical economic data contradicted this view, there needed to be a “more accurate” lens through which to view societal conditions.
Thus, critical theory was born as history’s most elaborate rationalization for denying reality. Objective reality was necessarily one of the prime targets of critical theory because it could tell only one story: capitalism was a vastly superior economic system not only to socialism but to any other economic system yet discovered. So, objective reality had to be challenged.
This eventually led the critical theorists to focus on minority victim groups and how capitalism was oppressing them, even if it was yielding vastly better economic results in the aggregate.
Of course, this was no truer than Marx’s economic theories about capitalism. What has vastly improved the lives of “people of color,” women, and other “marginalized groups” in poor countries over the past several decades has been less socialism and more capitalism.
China and India did not go from destitution to explosive economic growth because of diversity or democracy. Their transformation is due entirely to becoming more capitalist. Are they laissez faire? No, but they’re far more capitalist and far less socialist than they used to be. The same can be said for dozens of other countries.
A billion people were lifted out of extreme poverty over the past three decades and all the gains came in countries that became more capitalist and less socialist. There are zero outliers.
One can see why objective reality is such a problem for Marxists. This is why they fight on the cultural front, using all means possible to distort objective reality and persuade their target victim groups that capitalism is oppressing them. To achieve their ends, history must be erased, established customs declared racist, misogynist, or homophobic, and even the meaning of words changed to, in many cases, their antithesis.
But the end goal is economic. Every assault on societal norms must be viewed as a strategy to achieve socialism – because it is. No, the shrieking, purple-haired, nose-ringed, “trans man” may not realize this him/herself, but the people who created that unfortunate soul do.
Donald Trump was elected president in 2016 based on his “America First” platform. It’s three main planks were cracking down on illegal immigration, ceasing “endless wars” overseas, and economic nationalism. That last plank posited that “terrible trade deals” like NAFTA (1994) and allowing China into the WTO (2000) had hollowed out America’s manufacturing base, outsourcing the output and the high-paying manufacturing jobs to China and other lower-cost labor markets.
This assertion has no basis in reality, as the two charts below clearly show, but it was a big part of his appeal to Middle Americans. Trump promised to withdraw from the trade deals and use tariffs to bring manufacturing and manufacturing jobs back within American shores.
Industrial Production – 100 Year Historical Chart
The most curious aspect of this now-hoary populist canard was that it was sold as being pro-American worker. Tariffs weren’t going to simply make America as a whole more autarkic, or benefit business owners who otherwise could not compete with foreign manufacturers. They were going to benefit the so-called “working class” by bringing back higher paying jobs.
This is ironic because tariffs have historically been considered a transfer of wealth from the working class to big business. The original argument for an income tax was precisely to remove the burden of higher prices for consumer goods from the working class and shift some of the tax burden to big business. This was the case for the first peacetime federal income tax passed (and later found unconstitutional by the Supreme Court), the Wilson–Gorman Tariff Act.
President Biden today announced he would forgive up to $20,000 in student loans for people making less than $125,000 per year, with several other qualifications determining the amount each applicant is eligible for.
Biden’s political opponents have raised very reasonable objections to this politically motivated favoritism just over two months before the mid-term elections. What about people who paid off their loans? Why only student loans and not others arguably taken to underwrite more productive efforts than women’s studies or French poetry?
Why does someone who borrowed money to start a profitable business that employs people have to pay back its loans when someone who works a tax-subsidized job does not?
While calling out such blatant vote-purchasing for its violation of equal justice under the law and other statist dogma is perfectly valid, let’s not forget the economic law demonstrated by this bailout: the government cannot “invest.”
Politicians love to use that word for its wealth transfer schemes. “Invest in infrastructure,” “invest in working families” (which families don’t work?), and, in this case, “invest in education.”
Merriam-Webster dictionary provides two relevant definitions for the word “invest.” Government-guaranteed student loans doesn’t meet either of them:
1: to commit (money) in order to earn a financial return
2: to make use of for future benefits or advantages
Had the government’s “investments” in student loans met the definition of the word, there would be no need for a bailout. The money spent on tuition would be paid back out of the additional earnings students realized over and above what they would have earned without going to college.
That they not only aren’t in the black based on additional earnings to what they would have earned with a high school diploma, but can’t pay the loans back at all, should end once and for all the ability for politicians to claim they are “investing” in anything.
This excludes all the student loan borrowers who can pay back their loans but now will shift some of that burden onto others. Doctors, lawyers, university professors, and other affluent debtors will force plumbers, taxicab drivers, and construction workers – not to mention other doctors, lawyers, etc. who worked their way through school without student loans or who already paid them back – to pay their debts.
The grand experiment with government “investing” in higher education has produced two returns: people who can’t earn enough to pay back the loans and people who can but choose to force somebody else to do so.
All the same arguments against student loan bailouts can be made against public education in general. Why are homeowners forced to pay for public schools whether they use them or not, while wealthy renters pay nothing? Why is the service called “education” Sovietized in the first place? Is there something special about education that makes the government owning its means of production successful?
Of course not. Just look at the results. The more the government has “invested” in education, the less literate and numerate graduating students have become. Like every government-provided service, the cost keeps going up and the quality keeps going down.
Education, healthcare, infrastructure, transportation, the military – they are all the focus of massive government “investment.” And those investments all continue to produce the same returns: skyrocketing prices and plummeting quality.
Everything the government does is Afghanistan.
Investors in the private sector aren’t better people. They merely work under different incentives. When private sector actors invest, they stand to lose their own money. This powerful incentive doesn’t produce perfect results, but it produces infinitely better results than government spending. And when private sector investments go bad, no one else is forced to pay for their mistakes.
That is, unless one is on the Christmas list of the ultimate government investor, the Federal Reserve System. Its “investments” in stimulating the economy are the most damaging of all, producing steadily rising prices, artificial booms, disastrous busts, and more and bigger bailouts over time.
We have no choice but to pay for Biden’s latest vote buy. But let’s not let him or any other politician continue to call their loot distribution “investment.” Doing so should be tried in The Hague as a crime against veracity.
The war on civilization and its peaceful inhabitants is testing us like nothing else in our lifetimes. It is not only testing our resolve, but our principles. And nothing has tested the latter more than what has come to be called, “woke capitalism.”
As I wrote in last week’s installment of this series, it is important that the resistors have the right ideas. It is not enough simply to defeat our enemies. We must do so in a way that we don’t win battles but lose the war. And as with the political system, the arguments against woke capitalism are riddled with errors that will ultimately undermine our cause.
To understand if and why woke capitalism is a problem, we must first understand what capitalism is and why it is the only economic system compatible with a free society.
Our principles
We believe that every human being is created equal in one way and in one way only: no one has an inherent right to rule over another person. As a result of that equality, every individual owns himself or herself.
This state of self-ownership implies certain rights. They are first and foremost to not be killed by another person (right to life), to act according to one’s will (right to liberty) and to exercise ownership over legitimately acquired possessions. The natural limit to these rights is that one does not violate the equal rights of others.
John Locke reduced all of the above to a single word, saying people enter society and form governments for the “mutual preservation of their lives, liberties and estates, which I call by the general name, property.”
Another way to say this is that everyone has a right to what he or she owns and nothing more. This is the standard by which to determine what is a legitimate right and what is not.
One’s physical body, thoughts, beliefs, speech, actions, and peacefully acquired possessions are all one’s property. They cannot be taken away by someone else without one’s consent. Therefore, “healthcare” cannot be a right, it being the thoughts, speech, actions, and possessions of someone else. Neither does anyone have the right to involuntarily dispossess Person A to trade with Person B to provide healthcare to himself or Person C.
One may not claim a right to something that requires the labor of others without violating the property rights of those others. This applies equally to conscripting either Person A or Person B in the above example.
The right to possess real and movable estates contains within it three basic elements: use, exclusion, and disposal. If one owns a thing, he may use it as he sees fit as long as he does not do so in violation of the property of others. He may exclude others from its use without his consent. He may also dispose of the thing as he sees fit, meaning give it away as a gift, exchange it for other property, or destroy it.
Justice consists of preserving the property of individuals or making them whole when their property has been violated. Conversely, injustice is harming the property of individuals other than in self-defense. There is no other legitimate definition of justice, nor does legitimate justice require modifiers like “social” or “racial.”
Governments are formed ostensibly to administer justice, or, as John Locke put it, for the “preservation of their property.”
The American Declaration of Independence unnecessarily complicated the matter by separating “property” into myriad enumerated and unenumerated “rights,” going on to say, “to secure these rights, governments are instituted among men.” But the intent of those words was the same as Locke’s:
Anarcho-capitalism disputes none of the above other than the means for administering justice. Rather than a monopolist agency designated for the purpose, anarcho-capitalism proposes a free market solution. But the purpose of that solution is the same: to administer justice, meaning to preserve property.
What is capitalism?
The economic system generally known as “capitalism” or “the free market” derives directly from these principles. Capitalism assumes only one rule: that transfer of property may occur only with the voluntary consent of the owner. All other elements of the system: contracts, market prices, competition, etc., proceed from this rule.
Inherent also in capitalism is an element of property described by the founders as the right to “the pursuit of happiness.” This was listed separately from the right to liberty to emphasize that one is entitled to act exclusively in one’s own self-interest, rather than towards ends determined by others, within the same limit of not violating the property of others.
Adam Smith famously observed that people acting exclusively in their own self-interest do more good for society as a whole than those who intend to do so.
This is known as the “invisible hand” of the market. It is this aspect of the capitalist system from which all benefit to society springs. It is the reason capitalism always outperforms socialism. To reject the right of economic actors to pursue exclusively their own interests is to deny the right to the pursuit of happiness and to negate capitalism’s benefits to society.
How is woke capitalism a problem?
Woke capitalism rejects the invisible hand principle. It postulates that businesses should not merely pursue profits within a framework of property rights, but rather should also pursue “environmental, social, and governance (ESG)” goals. It also seeks to limit or exclude market participation by people who do not accept and demonstrate their support for various progressive dogmas.
The Biden administration says two straight quarters of negative GDP is much ado about nothing. Like accusations of Hero’s lost chastity in Shakespeare’s play, Biden’s economy is falsely accused of being in recession, the president’s spokespeople say.
Biden’s defenders in the media concur. The Hill informs us that two straight quarters of negative GDP defines a recession in many countries but, contrary to public opinion, not in the United States. Here, there is no recession until the National Bureau of Economic Research’s (NBER) Business Cycle Dating Committee – the “experts” – declare one.
The committee looks at a broad range of economic indicators to determine whether the economy is in recession. While declining GDP is one factor, it is not the only factor. And the chief reason the NBER has not declared a recession, according to the Biden administration and others, is the “red hot jobs market.”
Nobel Laureate Paul Krugman helpfully tweeted a chart showing the relative number of jobs “added” to the economy during the presidencies of Presidents Trump and Biden.
It is true that unemployment is near historic, pre-pandemic lows at 3.6%. And although that doesn’t count the vast number of people who have left the workforce due to retirement or discouragement, the administration can still point to over 2.7 million jobs created in 2022, according to the BLS jobs report.
But arguing there is no recession because new jobs are being created rather misses the point.
Jobs are not an end in itself. The purpose of creating jobs is to produce products. One would only want to create more jobs if it would lead to producing more products. Creating more jobs to produce the same or less products wastes scarce resources.
Just imagine a manager triumphantly reporting to the owner of a company that, although production decreased in the last two quarters, the lower output was accompanied by higher payroll costs. He’d be fired immediately; perhaps referred for a mental health evaluation.
What makes a company profitable is to satisfy demand for its product with as few employees and other costs as possible. The wealth of an economy is no different. As fewer employees are needed to produce each product, more are available to produce others.
Not only does this contribute to greater wealth for the economy as a whole, but it also represents higher worker productivity and thereby higher wages.
This is why tax incentives to corporations tied to the number of jobs they’ll create is economically idiotic. While in most cases, companies will take the tax breaks and only create the jobs they need, leaving the politicians and their constituents to complain the jobs never materialized, it is really the complaining that is erroneous. Had the company created more jobs than necessary to produce its products, it would by definition be wasting resources and thereby making the population poorer in the aggregate.
It is also important to remember that what is produced matters as much as how much. A population does not become wealthier merely because the total amount of goods produced rises. It only becomes wealthier if more of what consumers value is produced.
Value can only be determined if consumers are free to refuse to purchase the increased output. Only by freely choosing whether to purchase at all and at what maximum price can the value of the new output can be determined.
This is why output resulting from government spending is at best of unknown and often of no value whatsoever. Since taxpayers have neither the opportunity to decline to purchase nor to set their own maximum price, there is no mechanism to determine the value of this output.
That government spending, currently at massive levels, is counted in GDP and GDP is still declining accentuates the fact that Americans are getting poorer in the aggregate. Not only are they producing less, but a significant percentage of what they are producing – like missiles sent to Ukraine – provide no value to American consumers.
Government bureaucrats can arbitrarily define the word “recession” any way they wish. But creating less wealth by any other name would smell as foul.
Everyone knows there is something wrong. America and much of the world is now firmly into its third year of unrelenting “emergencies,” real and imagined, that forbid them from returning to the quiet comfort of their previous lives. For twenty-eight months they have been told they must sacrifice their personal interests for the government-media complex defined “greater good.”
It started with “fifteen days to flatten the curve,” a reasonable-sounding request in the face of a supposedly novel respiratory virus. One hundred years of science had already confirmed quarantining asymptomatic people is ineffective, but it was only going to be fifteen days.
It is only now, after the fifteen days turned into fifteen months or more in some places, after mask and vaccine mandates were enforced long after it was obvious both are ineffective, after the demand for sacrifice seamlessly metamorphized from “flattening the curve” to “slowing the spread” to “defending Ukraine” to “climate change emergency,” that a critical mass of people have finally realized they are being had.
If it were just your money they were after, it would be bad enough. And make no mistake, they do want that. Trillions have been fleeced from the many and handed to the few during this long con. But it isn’t just your money the perpetrators are after. Neither is it merely your freedom, although there is no “life” beyond biological existence without it.
No, the architects of this dystopia aren’t satisfied to loot your wealth and crush your liberty. Even controlling your physical movements isn’t enough. They want to control your thoughts, what many people would call your “soul.”
It’s not as if they make any secret of this. What else can the obsession with stamping out “misinformation” mean? They do not want you exposed to information contrary to their ends because you may think the wrong thoughts.
You may question whether the vaccines really are “safe and effective,” whether the war in Ukraine really is any of your concern (or “unprovoked,” for that matter), whether there really is a “climate change emergency” that demands you make enormous sacrifices to solve, or whether those sacrifices would really make a difference if there were.
There are only two possible reasons why information questioning any of the above narratives would need to be kept from you. Either the claims being made aren’t true and would not hold up to challenges or you are incapable of discerning truth from falsehood. If the former is true, there are criminal trials that need to be held. If the latter, then why this anguished cry about dangers to “our democracy?”
The question is constantly raised whether the architects of this assault on civilization are evil or merely misguided and incompetent. Does it matter? Is there even a clear distinction between the two? Was Vladimir Lenin evil or merely misguided? Did he not believe he was acting in the best interests of his fellow man and merely had to “break a few (million) eggs to make an omelet?” Can we not say the same for Stalin, Hitler, or Mao?
I hear it all the time. “Mussolini defined fascism as the merger of state and corporate power.” It has been suggested that modern American corporations like Disney, Meta (Facebook) or Alphabet (Google) acting in ways that align with the federal government’s wishes constitute fascism, based on this “merger of power” definition.
Here is the problem. Not only did Mussolini never define fascism that way, but he said almost precisely the opposite. “Merger” implies cooperation, partnership, or a meeting of the minds between equals. Fascism bore no resemblance to this. Mussolini’s actual words were, “The Fascist State lays claim to rule in the economic field no less than in others.”
What was a fascist “corporation?”
When Mussolini used the word, “corporation,” he didn’t refer to a single company like Disney or Alphabet. Rather, each corporation was a cartel formed from all companies in a particular economic sector. Mussolini divided the economy into twenty-two such “corporations,” which were run by members of the Fascist Party appointed by Mussolini himself. As John Gunther wrote in Inside Europe,
“Every corporation contains three supervising delegates of the Fascist party; each corporation is headed by a member of the cabinet or an under-secretary, appointed by Mussolini. The deputies, moreover, are “voted” into he chamber from an approved list chosen by the Grand Fascist Council; electors are privileged simply to say Yes or No to the whole list. Mussolini’s two general “elections” have been grossly dull affairs.
The state, being supreme, regulates economy for its exclusive benefit. Fascism may be, spiritually, “an attempt to make Romans out of Italians,” but physically it made Italy a prison.”[1]
This was not a “merger” of powers. It was the state exercising absolute power over the economy. It was autocratic rule over private businesses by the government.
So, why is this misquote and misunderstanding of fascism so popular? Because it coincides with a general tendency towards the “anti-capitalist mentality” Von Mises described and which is again ascendant across the political spectrum in America.
“Can you believe this spending with a REPUBLICAN in the White House????”
I’ve heard it my entire adult life, starting during the Reagan years. I’m not sure how many times Republicans have to increase spending twice as fast as their Democratic predecessors before people get used to the idea that this is what Republican presidents do, regardless of which party controls Congress.
This shouldn’t be a surprise. The Republican Party was born out of the ashes of the Whigs, whose stated goal was to expand the range of things the federal government spent money on. Before the Civil War, most roads were privately owned. Not just privately built; privately owned. Taxpayers didn’t contribute a cent towards them.
Not only did the Republican Party Sovietize the road system, they did the same with railroads and all sorts of other areas of life. Before FDR, it was Republicans who established most new federal departments.
Today, the government has Sovietized the distribution of Covid-19 vaccines and other treatments, a precedent established under the last Republican president.
When you consider the actual records of Republican presidents from Lincoln through Trump, it turns out that Harding and Coolidge were the real “RINOs.”
In the post-WWII era, spending almost always goes up (not counting the obvious decrease right after the war – which led to an economic boom, btw). But I decided to take a look at how fast it went up during the various presidential administrations starting with JFK/LBJ. I used the following methodology:
Measure the increase in yearly federal spending for each president as a percentage of the spending in the last year of his predecessor. For example, spending was $590 billion in the last year of the Carter Administration. It was $1.06 trillion in the last year of the Reagan administration, an increase of $473.4 billion or 80.1%. That comes in at just over 10% per year on average.
You’ll never guess who grew spending at the slowest rate since 1951. Certainly not the Gipper. Nor was it either Bush. No, as a percentage of spending during his predecessor’s last year in office, the president who grew the budget at the slowest rate was Barack Obama.
I broke it all down on Episode 85 of Tom Mullen Talks Freedom. I provide documentation of the outlays and receipts on the show notes page. A summary table is provide below.
All spending increases are aggregated for the full term of the presidency and then averaged. Example: to calculate President Obama’s spending increases, 2008 spending is subtracted from the spending during the last year of his presidency (2016) to arrive at an increase of $870 billion over eight years. That total is divided by 2008 spending of $2.9 trillion to arrive at the 29.2% aggregate spending increase. Spending increases for each presidency is calculated in similar fashion.
I combined the presidencies of Kennedy/Johnson and Nixon/Ford as Kennedy and Nixon both served partial terms which were completed by members of their own parties.
Calculations are made for the Trump years 2017-2020 and 2017-2019.
Spending is not adjusted for inflation. All spending is in billions
Of course, regardless of how quickly or slowly it increases, federal spending is always destructive. It’s important to remember the government has failed at every major spending initiative it has undertaken in my lifetime, whether it is military or domestic policy. Vietnam, Iraq, Afghanistan, the Department of Education, the War on Drugs, Covid – it’s always all pain and no gain when it comes to the government. And the price just keeps going up.
Still, it is remarkable that spending goes up so much faster when a Republican is in the White House. The excuse is often made for Reagan that he had a Democratic Congress. But the Republicans controlled the Senate for 6 of Reagan’s 8 years in office, so that claim isn’t even true. The Democrats did have both houses of Congress during George H.W. Bush’s 4 years, but spending didn’t go up as fast during those years. Oops.
The other excuse often brought up in defense of profligate Republican presidents is that Congress “has the purse strings.” This is technically true, but when one looks at the spending proposed by the presidents in question and compares it to what Congress eventually appropriated, there is never much difference.
When an opposition party controls Congress, there is always some demagoguing over financially inconsequential components of the president’s proposal. See “funding Big Bird.” But in general, the executive branch proposes the spending and Congress rubber stamps it. And let’s not forget, no spending can occur without the president’s signature.
There is also some evidence that the combination of a Democratic president and Republican Congress may slow spending increases the most, but comparing spending increases during the first two years Presidents Clinton and Obama were in office (with Democratic Congresses) to spending increases over the remainder of their terms hardly provides conclusive proof.
The record does show that spending seems to grow relatively slowly with a Democratic president and a Republican Congress. And since gridlock in Washington is always good, to the extent we get it, for all sorts of non-fiscal reasons, let’s hope for a Republican landslide in this year’s midterms.
