I originally posted the charts below September 20, 2008 under the heading “Hey Big Spender“. It is still a great picture of reality that flies in the face of pervasive mythology.
So many politicians and fans thereof hold the memory of President Reagan up as the ultimate fiscal conservative. You can find only one ex-USA-president in history more profligate. Yet the mythology lives on … and on… and on. It frosts me to no end. So I’m turning the original post into a page so it will be easier to find and reference.
There are three ways that government can finance itself. Direct taxation is the most honest, but it is SO LIMITING. The people will only put up with so much before the rulers have to live within a budget. They find that unacceptable.
USA rulers grew fond of national debt – sort of executive credit card that would have to be paid off in some distant future. Rulers got credit for bringing all sorts of wonderful goodies home while few observers noticed the credit card bills piling up on the porch.
National Debt Increases
Roosevelt F….1048%…..D
Wilson…………….722%…..D
Reagan………178%….R
Bush II………..84%….R
Bush……………54%….R
Ford……………46%….R
Carter………………43%……D
Nixon………….34%….R
Hoover………..33%….R
Clinton………………32%……D
Roosevelt T….23%….R
Johnson……………19%……D
Taft…………….10%….R
Eisenhower……8%….R
Truman………………6%……D
Kennedy…………….4%……D
Harding……….-7%….R
Coolidge…….-24%….R
That table does a lot of myth busting. FDR and Woodrow Wilson are held up as great champions of the working stiffs. Who got to pay their whopping ‘credit card debts’? Those bills made darn sure the poor remained poor for a long time. While technological advances and the surge in US worker productivity should have created impressive wealth for the masses, they instead had to make interest payments on the bills their champions ran up for them.
Reagan is the conservatives’ conservative; the Republican’s Republican. He is credited with making the economy run like a well-oiled machine. Yeah, just like the new stepdad who brings home every toy on the planet while running up a credit card bill that is almost double the family’s annual income. Fifteen years later, the conservatives still hold him up as the star of fiscal responsibility. The legend he earned is the complete opposite.
This is the century of the central bank. The Federal Reserve, a consortium of private banks, was given control of our currency in 1913. Until then, a dollar was worth a dollar, convertible directly to silver or gold, and technological advances steadily reduced the cost of living.
The concept of central banks is as old as central government. So is devaluing the currency. One way an administration can spend without offending the masses with overt taxation is to print more money. Few people notice the dilution of their money, but more dollars obviously make existing dollars worth less. The ones average people are holding go down in value every time the New York bankers spend the output of their printing presses.
Consumer Price Inflation
Roosevelt F…..105%…..D
Truman…………..79%……D
Reagan……….64%….R
Johnson…………..44%……D
Wilson………………43%……D
Eisenhower….31%….R
Carter ……………..31%……D
Roosevelt T….30%….R
Clinton……………….29%……D
Ford…………….28%….R
Bush II…………28%….R
Nixon……………25%….R
Harding…………14%….R
Coolidge………..13%….R
Bush………………10%….R
Taft……………….10%….R
Kennedy…………….-0%……..D
Hoover…………-43%….R
Not much surprise in who cut the value of the working man’s dollar in half. However there is an eye-opening third place, that star of conservative Republicanism Ronald Reagan, reducing people’s savings and paychecks by a whopping 64%. The conservatives should have reviled him and embraced JFK, who treated our savings, earnings and future with more respect than nearly every Republican of the last century.
As surprising as finding Reagan in second-to-last place for the drunken sailor award is finding John F. Kennedy in first place as the most careful of all presidents with public money. This guy deserves a bit of revisionist history written about him .. but that gets in to who killed him, who covered it up and why… big can of worms for sure with “Central Bank” written all over it.
My point in adding in the party affiliations here is to say if you want an administration that doesn’t reduce the value of your dollar, you need look somewhere besides these two. Even the average Republican will cut your paycheck by 25% and hit your savings and retirement accounts just as hard with their inflationary monetary policies.
Of course if you really want to be left with the money you work for, you better give up on both the blue jerseys as well as the red ones.