Remember when people were saying that the old Republican ideas, the venerable supply-side reforms that first made their mark in the Ronald Reagan era of the 1980s, were no longer relevant in terms of getting us out of our rut today, on account of their already having been made policy? It was only yesterday that we heard all this—in the campaign of 2012.
Cut taxes? Done plenty over the last thirty years by Reagan, even Bill Clinton, and then George W. Bush. Roll back regulation? Done again (and we apparently saw the fruits in the financial crisis). Sound money? Interest rates are undetectable these days, a tiny fraction of those Jimmy Carter conducted over to Reagan in the massive dollar crisis of 1980-81. Free up trade? We now live in a bewildering era of globalization!
These four things—low taxes, stable money, deregulation, and free trade—are known as the “four pillars of Reaganomics,” one of the classical statements of which the great supply-sider Arthur B. Laffer set down here.
All so quaint, aren’t they, applicable as they may have been to the challenges of a generation ago.
But wait…now in 2013, taxes have gone up, and President Obama insists that more increases must come; regulation, in the form of Dodd-Frank, the Federal Reserve’s new plenary powers, Obamacare, and EPA mandates, has taken a giant leap; dollar substitutes like gold have blown through the roof; and big dogs in international trade, Japan and the Eurozone, are contemplating such things as competitive devaluations and the possibility of a breakup into autarky.