It was the early 1980s and Ronald Reagan was under assault.
Yet instead of buckling Reagan wound up providing a classic case study in presidential leadership
As President Bush’s Iraq policy and his goal of victory comes under merciless attack from the non-believers, doubters, and skeptics in official and unofficial Establishment Washington, it is worth a look back at how Reagan led America to the land of lower taxes and great prosperity. It wasn’t easy.
While the subject was taxes, it could just as easily have been something else Reagan believed in because his leadership abilities were so frequently on display. But the tax example is particularly relevant today because in recounting this story I have turned for a refresher to With Reagan, the memoirs of Reagan aide and later Attorney General Edwin Meese, currently in the news as a member of the controversial Iraq Study Group.
Elected in a 44-state landslide over President Jimmy Carter, in no small part because of the Democrat’s abysmal handling of the economy that had saddled the nation with double-digit unemployment, interest rates, and inflation, Reagan vowed change. The change was the then “radical” doctrine of supply-side economics, a philosophy that correctly understood that low taxes were the key to a sound and thriving economy.
In retrospect the easiest part of implementing these changes was getting them passed through a Democrat-controlled House. (Republicans, on Reagan’s coattails, then ran the Senate.) The Reagan landslide had gotten the attention of the opposition, and there were in fact votes to be found for the President’s plan even in the belly of liberal Speaker Thomas P. “Tip” O’Neill’s House. Working the phones relentlessly, aided by a boost in popularity owing to his conduct in a near-fatal assassination attempt, the President’s tax cuts passed.
Reagan proudly signed them into law in a fog-shrouded ceremony at his ranch on August 17, 1981. Then came the hard part.p>Federal spending kept going, and the difficulties in roping it in became apparent to the Reagan team, as Ed Meese freely acknowledges. But what was particularly notable was a new discovery that Meese describes this way: br> /p>
Related to this, on my part as well as on the President’s, was the assumption that everyone on the Reagan team had a similar view of the problems we faced and a similar commitment to solve them, whatever the difficulties. My approach was that we all knew what the President wanted and that our job was simply to go out and do it. But as later became apparent, various members of our team thought otherwise.br> In other words, even as the President was suddenly fighting to keep his newly-enacted tax cuts from being upended before they had even kicked in, there were those within his own administration who tried to sabotage his efforts. How did this manifest itself in real terms? Reagan’s own Budget Director, David Stockman, again per Meese, “secretly decided we should give up on the Reagan program. His feelings were not expressed in cabinet meetings, but became abundantly plain as events unfolded. From a fairly early point, Stockman decided it was his mission, not to support Reagan’s tax reduction program, but to maneuver the President into backing away from it.”
Stockman wasn’t alone, either. He was but one member of the so-called “Baker group.” (Yes, of course, that would be Baker as in then White House Chief of Staff James A. Baker III, currently of the Baker-Hamilton Iraq study.) Another was Baker aide Richard Darman. Meese points to the book Gambling with History, an account of the early Reagan years by Time magazine’s Laurence Barrett, where confidential memoranda prepared by Stockman and Darman show conclusively that members of the President’s own senior staff had decided for themselves “that tax rate reductions would be calamitous for the economy and (began) setting to work surreptitiously to change the program.”
SO WHAT DID THE “Baker group” do? They had come to the conclusion, Meese says, that the President needed to be “educated” on the failure of his tax-cutting policy, a sentiment that is now rampant in Washington with regard to Bush and Iraq. But how does a White House staffer see to it that the President he is serving is undercut? How does Washington actually go about cutting a President down to size when he has the audacity to go against the (almost always wrong) conventional wisdom?
First, you try and isolate the President. Make as certain as you can that he — and everyone else — comes to believe he is the only person left who believes in his own policy. In the Reagan example this meant that Darman and Deputy White House Chief of Staff Michael Deaver, a key member of the Baker group, went out of their way to control the “human and documentary” traffic into the president. In Reagan’s case this meant that supply-side believers like Congressman Jack Kemp were denied access to Reagan. Instead, business leaders who favored a compromise on tax cuts were ushered into the President’s presence.
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