As he pops jelly beans midst the finery and pomp of his august digs, does Ronald Reagan or does he not feel the pain of the poor? Dan Rather, CBS's millionaire television personality, is not sure. Edward M. Kennedy, Massachusetts' multimillionaire senator, doubts it violently. So for that matter do most of the famous senator's well-fed allies, and bear in mind that these people have made the pain of the poor their especial interest. One might say, their vested interest.
Apparently the condition of Ronald Reagan's heart is to be the focal point for the debate over his economic program and over his "new federalism." His critics are moving in the right direction. Certainly it will be more profitable for them to conduct their campaign against these programs at the level of gossip and soap opera than at the level of economic analysis and substantive policy.
After all, they have no economic alternatives that have not already exploded in the face of the taxpayer, the investor and the worker. Listening to their caterwauling last week put me in mind of a maxim deserving wider circulation, to wit: those who believe patriotism to be the last refuge of the scoundrel have underestimated compassion.
Blaming the past year's economic problems on Ronald Reagan's tax cuts and budget deficits is an essay in economic illiteracy. As Alan Reynolds points out in the forthcoming issue of The American Spectator, those who do so must argue either that the prospect of future tax cuts caused a recession or that investors would have financed more long-term loans at lower interest rates if only the Fed had flooded the republic with more money.
As practically every economist knows, the present recession has no connection with the Reagan economic program. It began last July, resulting from rising long-term interest rates due to growing doubts that the Fed had any sense of what it was doing.
The consequence was mile-high interest rates that sent the economy into decline. Were Jimmy Carter in the White House today, or any of his fellow economic conjurors, present conditions would be no better and probably worse. Government spending would be higher and the Fed would be acting just as ambiguously.
Now that we have heard the Democrats' sad wails over Ronald Reagan's State of the Union Message, and now that the media have introduced us to all the starving masses, what will the critics have us do? On this they are somewhat coy. Apparently they would have us take the blowzy and disorganized federal government that they have given us and fatten it up all the more.
Then, too, they would like to increase the money supply, so that our dollars would buy still less. Finally they would raise your taxes -- on that all the critics agree. Nothing more shiningly illuminates the desperate straits in which the liberals now find themselves than this last piece of quackery. Imagine, the disciples of Lord Keynes prescribing an end to recession through higher taxes. It is the counsel of either the brainless or the shameless.
Last week we heard much solemn tosh about the good society, the caring society. Ronald Reagan is reputed to be hostile to the good society because he noticed that welfare entitlements were rising faster than our society's capacity to pay for them and decided that this growth rate had to be slowed. Remember, Reagan has not cut entitlements back; he is merely attempting to slow the colossal swelling. Between 1970 and 1980 real spending per individual poverty client grew 82 percent not counting increases in Social Security, Medicare and federal employee retirement programs. In 10 years, Medicare and Medicaid costs have ballooned from $11.2 billion to almost $60 billion.
The critics are not satisfied with this growth. They believe the good society goes on and on raising government subsidies, coaxing more and more people at the lower rungs of the economic ladder off that ladder and into the government trough. Even when the economy is flat on its back the sacred process must continue. Through the 1970s welfare programs grew 2 1/2 times as fast as the gross national product and three times as fast as wages. Still, the liberals want to whack the taxpayer for more swag.
Ronald Reagan's budget cutters are laying into income maintenance programs with horrifying fury, we are told. Yet his administration will spend more on them this year than last.How many workers are to be added to the welfare rolls before the president's critics are satisfied that they have created the good society?
Next year's deficit is an unpleasant prospect, but those liberals who cringe at it now are not very convincing. Deficits never worried them in the past. "We only owe it to ourselves," they were wont to say. If they really have grown so moderate in the present squeeze, let them prove themselves. Let them cut into the extravagant cost of government, and let them return some reponsibility to the states.