Francis Fukuyama and the Reagan Revolution

From the formulation of the Reagan Doctrine to the Iraq war, Francis Fukuyama was da man.

He didn’t make this wonderful cartoon of Ronald Reagan that adorns his recent Newsweek article. But his article does point back to the legendary helmsman of deregulation and shoot-first-ask-questions-later. No doubt – the incumbent president wished to be a worthy successor to Reagan. The irony is that Bush jr. is exactly that, and that only a minority of Americans will probably question the idea that Reagan was a “great president”.

Fukuyama: Many commentators have noted that the Wall Street meltdown marks the end of the Reagan era. In this they are doubtless right, even if McCain manages to get elected president in November. Big ideas are born in the context of a particular historical era. Few survive when the context changes dramatically (…) Reaganism (or, in its British form, Thatcherism) was right for its time.

That’s an interesting idea. It seems to rely on the physical concept of inertia – if you want an inert mass to move into the “right” direction, you have to use radical tools. A “Reagan Revolution”.

One problem with most revolutionaries (from all political origins) is their contempt for “common people” – traditionally referred to as “the masses”. Another is that they can’t admit when they are wrong.

Fukuyama, one of the authors of the Reagan Doctrine, puts it this way: Like all transformative movements, the Reagan revolution lost its way because for many followers it became an unimpeachable ideology, not a pragmatic response to the excesses of the welfare state.

The whole we-are-the-only-patriots thing was only an aberrance? Then why does Mr Fukuyama call the Reagan Revolution a “revolution” in the first place? Reaganomics was one of the pillars of the “Revolution”, a pillar which isn’t right, and which never was. Its policies weren’t even meant to be fiscally conservative, as Fukuyama confirms himself in right the same article where he asserts that it was right at its time. But Reaganomics was an ideology from the beginning – not a pragmatic response.

There is one paragraph by Fukuyama which looks convincing – but it could have been written by an amateur blogger, too:

Reaganomics introduced the idea that virtually any tax cut would so stimulate growth that the government would end up taking in more revenue in the end (the so-called Laffer curve). In fact, the traditional view was correct: if you cut taxes without cutting spending, you end up with a damaging deficit. Thus the Reagan tax cuts of the 1980s produced a big deficit; the Clinton tax increases of the 1990s produced a surplus; and the Bush tax cuts of the early 21st century produced an even larger deficit. The fact that the American economy grew just as fast in the Clinton years as in the Reagan ones somehow didn’t shake the conservative faith in tax cuts as the surefire key to growth.

If only Fukuyama, an achieved political economist, had helped the Reagan administration, its cronies, and the American public to understand this by the mid-1980s. And if he really believed in voodoo economics (George Bush sr.) then, he could have asked Mrs Ochmonek for advice. She wouldn’t even join a tupperware party.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: