“Those who do not remember the past are destined to repeat it,” the old maxim goes.
It’s clear that if Joe Biden were elected president, he would take us back toward the policies of the Great Society, which led to the economic stagnation of the 1970s.
Prior to the COVID-19 shutdown, the United States was experiencing some of its best economic numbers in a long time, including a 3.5 percent unemployment rate — a half-century low.
Furthermore, African-Africans, Hispanic-Americans and Asian-Americans were enjoying the lowest unemployment rates ever recorded.
Despite the coronavirus pandemic, the Dow has clawed its way back to top 27,000.
What policies led to the boom? Trump reached back to the Ronald Reagan playbook of the 1980s, which was a time of incredible economic expansion, the best seen since World War II.
His policies included lowering taxes on businesses and individuals, cutting regulations on companies and increasing the nation’s energy supply.
Reagan’s election in 1980 really was a direct response to the big-government policies of the 1960s, as typified by the Great Society enacted under Democrat Lyndon Johnson.
Those liberal policies included a vast expansion of the welfare state, which resulted in a disincentive to work for both the wealthy and the poor.
Those making money were being taxed at a top marginal rate of 70 percent, while those at the lower end of the economic scale often lost government benefits like food stamps, Medicaid, welfare payments and federal housing if they took a job, making government dependence in their best economic, though not spiritual, interest.
In July 1979, then-President Jimmy Carter, in his famous “Crisis of Confidence” speech, painted a picture of a country that had lost its way.
“The symptoms of this crisis of the American spirit are all around us,” he said. “For the first time in the history of our country, a majority of our people believe that the next five years will be worse than the past five years.”
Carter recounted the economic challenges the country faced at the time, including double-digit inflation, low productivity and an unemployment rate at nearly 6 percent.
The U.S. experienced negative economic growth during the election year of 1980, causing unemployment to climb still higher to 7.5 percent by the time Reagan took office in January 1981. It would top out at over 10 percent in the early years of his presidency before his economic policies took effect.
By 1983, following across-the-board tax cuts, the economy began to boom with 3.5 million new jobs created that year, followed by 3.9 million in 1984.
“There was a reason Reagan called his [re-election] advertising campaign ‘Morning in America’ because in the ‘70s and the early ‘80s it didn’t feel as though we were in morning in America. There was kind of a purgatorial, afternoon feel to the country,” Amity Shlaes, the author of “Great Society: A New History,” told The Western Journal.
Shlaes, who has served on The Wall Street Journal’s editorial board, says the big-government policies led to the economic doldrums of the ’70s.
“A lot of the … policies of the period didn’t yield what they hoped to yield and hurt the economy terribly so that we had the ’70s, which were not just an afternoon, but a long, sad, dark afternoon,” she said.
“The private sector had a lot of possibility but wasn’t able to realize it. So it was an incredible tragedy that we could have created jobs and we didn’t,” Shlaes added.
The author of the New York Times bestseller “The Forgotten Man” lamented the real-world impact: that many Americans could have led happier lives but for the big-government policies.
“An emphasis on redistribution instead of [economic] growth, an emphasis on result instead of opportunity, a misguided sentimental poverty policy that reduced effectively … the way that we emerged from poverty” are what characterized the Great Society programs, Shlaes said.
The Reagan Revolution addressed the first two problems by implementing policies that nurtured economic growth and opportunity, while the Republican Revolution in the 1990s enacted a work requirement to receive welfare benefits that enabled millions of people to ultimately move from the welfare rolls to independence.
Unfortunately, the Barack Obama-Joe Biden administration took steps to move the nation back toward the Great Society days by raising taxes, adding a vast new government entitlement program in Obamacare and relaxing the welfare work requirements.
Not surprisingly, the U.S. experienced its worst economic recovery since World War II, which even CNN conceded.
Now Biden, if elected president, proposes to do more of the same, only this time with an even further-left agenda.
Late last month, the former vice president said he planned to “get rid of the bulk” of the Trump tax cuts for businesses and individuals and greatly increase the capital gains tax.
The latter is the tax on investments, so Biden’s policy would be a disincentive to invest. Investments are what create businesses, allow them to grow and add jobs.
Biden plans to raise the tax to a level not seen since the Carter administration — nearly 40 percent, according to Americans for Tax Reform. It is currently either 15 or 20 percent, depending on your income level.
Of course, one reason Biden is proposing higher taxes is to finance vast expansions of the entitlement state, like that seen during the Great Society, as outlined in the former VP’s “Biden-Sanders Unity Task Force Recommendations,” a set of policy proposals co-created with independent Sen. Bernie Sanders of Vermont.
Some of the new entitlements include universal pre-K child care, paying public college tuition for all students from families earning under $125,000 per year, dropping the Medicare age of eligibility to 60, expanding Obamacare health care insurance premium support and expanding Social Security benefits.
All of this and so much more being proposed by Biden costs money and lots of it.
He recently announced a Green New Deal-like climate plan with a projected cost of $2 trillion on its own.
Repealing the Trump tax cuts will not pay for these proposals by a long shot, but it would prove the nation has not learned the lessons of the Great Society fiasco.
In Reagan’s famous “A Time for Choosing” speech in 1964 at the dawn of the Great Society, he said, “This is the issue of this election: whether we believe in our capacity for self-government or whether we abandon the American Revolution and confess that a little intellectual elite in a far-distant capital can plan our lives for us better than we can plan them ourselves.”
Reagan added that the choice for voters was not whether America’s government would go to the left or right, but whether the whole of society would go up or down.
“Regardless of their sincerity, their humanitarian motives, those who would trade our freedom for security have embarked on this downward course,” he said.
As was true then is true now. The Great Society in large part failed, and Biden’s plan to double down on it will have the same result.
The lesson of history could not be clearer.
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