“I didn’t come to Washington to raise
taxes.”
— Congressman Jack Kemp to President
Ronald Reagan
Jack Kemp was furious.
Summoned to the White House in 1982 for a one-on-one with
President Ronald Reagan — Reagan not only his longtime ideological
and political ally but his old boss (as an off-season football
quarterback for the Buffalo Bills Kemp had served an internship as
a special assistant to the fledgling California Governor Reagan in
1967), now-Congressman Kemp was adamant.
Reagan was being told by all manner of GOP Establishment
leadership types like Kansas Senator Bob Dole, the chairman of the
Senate Finance Committee, that taxes had to be raised as Democrats
insisted. The Reagan economic policy was a failure, Reagan was
being told. And the Democrats had a deal — a spending reduction of
$3 for every $1 in tax cuts. After trying mightily to get Reagan to
give up on the third-year of his tax cuts — which Reagan flatly
refused — Dole made his pitch for an increase in business and
excise taxes. Based on the idea of those corresponding budget cuts,
Reagan reluctantly went along.
“My heart isn’t in it,” he wrote in his diary. It wasn’t — and
it decidedly wasn’t in Kemp’s either.
Reagan was frustrated, Kemp incensed. Neither man saw increasing
taxes as anything more than the umpteenth excuse to grow government
as opposed to the economy.
Be that as it were, the Reagan White House was sent out there
full bore to raise business and excise taxes. The House Republican
leadership, including a GOP Congressman from Wyoming named Dick
Cheney, pressed the case that working with House Speaker Tip
O’Neill and his majority was the way to solve the problem.
So too was Reagan’s Budget Director David Stockman — a close
Kemp ally when Stockman served in the House as a young Michigan
congressman — pressing the case. Stockman had been an early
behind-the-scenes deserter on the President’s tax cuts, coming
close to getting fired when it was revealed he had been covertly
making all manner of wild accusations about the economics of tax
cutting.
Yet Jack Kemp was refusing to go along. He simply didn’t buy the
pitch. If taxes rose, he was convinced — and this was in the
aftermath of the first round of Reagan tax-rate and budget cuts a
year earlier in 1981 — not only would ground be lost in the fight
for economic growth. More to the point the budget cuts would never
occur — and Democrats would soon be back demanding even more
spending.
So, fresh from his tense meeting with Reagan, Kemp returned to
Capitol Hill and rounded up some 61 House Republicans to say what
he was saying quite publicly:
I did not come to Washington to raise taxes.
In a speech on the House floor Kemp took direct aim at the story
Dole and other Republicans, not to mention O’Neill and his
Democrats, were spreading: that the business and excise tax
increases were really not such a big deal. To which Kemp replied by
running down an itemized list of the proposed tax increases,
mocking the promise that the tax increases wouldn’t really affect
middle-class Americans. This was correct, said Kemp sarcastically,
if
…you don’t use the telephone, don’t pay medical insurance
premiums, don’t suffer losses due to theft or casualty, don’t
smoke, don’t ride in airplanes, or don’t have a savings
account.
Sending his formal letter of protest to the President that was
signed by those 61 House Republicans, Kemp pointedly added:
Quietly, without debate, the Republican Party is in danger of
making a U-turn back to its familiar role of tax collector for
Democratic spending programs.
This Kemp remark, writes Reagan biographer Steven Hayward, was
the origin of the thought that Kemp’s compadre Congresssman Newt
Gingrich would later tartly express: that the GOP’s Senate Finance
Committee Chairman Bob Dole and his support for tax increases made
Dole and his fellow GOP tax increasers the “tax collector for the
welfare state.”
Bob Dole was furious, protesting — in a remark that is uncannily
prescient for the same struggle in December of 2012 —
We’re not trying to make a U-turn. We’re just trying to
avoid going over the cliff.
Then Dole grumbled about the classical economics — or as it was
being called, “supply-side economics” — that had already been a
stunning success for presidents Calvin Coolidge and John F.
Kennedy:
I never understood all that supply-side business.
Catch that? In 1982 the tax wing of the Republican Party was
insisting that if Reagan juuuuuuuuuust went along with Tip
O’Neill and his band of liberals and increased taxes….America would
nevvvvvvvvvvver face the threat of going over the fiscal
cliff again.
Honest. Really. Never, ever again.
Ronald Reagan reluctantly agreed. Later saying it was the worst
mistake of his presidency.
And lo and behold……here we are again. Not to mention there we
were in 1990 when President George H.W. Bush was told the same
fairy tale — and fell for it too.
Stop here.
Amidst all the abuse principled House Republicans of 2012 are
taking for not agreeing with Speaker John Boehner to go along with
President Obama and raise tax rates on the “rich” — it is important
to learn from Reagan and Kemp’s hard-learned experience as they
themselves did.
For once in his presidency, in 1982 Reagan went against his
always superb instincts. Not to mention his knowledge of economics
gained over time as an economics major in college, an actor,
spokesman for General Electric, and, last but not least as a labor
negotiator in his role as head of the Screen Actors Guild.
But Reagan never, as is frequently portrayed today by Obama
allies, abandoned his belief in the economic necessity of lower tax
rates.
First, Reagan flatly refused to raise the very income tax rates
he had just finished cutting and signing into law in August of 1981
— not even a year earlier. To be quite colorfully specific, when
then-House Majority Leader Jim Wright, the Texas Democrat and later
Speaker, tried to get Reagan to go along with giving up the third
year of the Reagan tax cuts for a list of larger, unspecified
domestic spending cuts, Reagan bluntly replied:
You can get me to crap a pineapple but you can’t get me to crap
a cactus.
In fact, Reagan’s signature was literally not even dry on the
new 1981 law when the cry went up from liberals for its repeal.
Using the same “tax the rich” class warfare rhetoric employed by
Obama today, it a liberal demand that grew louder as 1982 rolled in
and before the new law had even taken effect. Reagan believed the
lower tax rates were essential to a robust economy — and he stuck
to his guns. Indeed, when Democrats on the Senate Finance Committee
sought to roll back the third year of Reagan’s tax rate cuts,
not a single Republican on the Republican-held committee went
along with them and the proposal died. What passed instead was
a compromise: Dole’s increase on excise taxes — telephones, air
travel and the like as Kemp noted on the House floor.
Second, the role of the media needs to be understood in this.
Just as the House Republicans of today are being pilloried both in
the media and by some fellow Republicans for refusing to agree on
principle to an increase in tax rates, so too back in 1982 was Bob
Dole and any other pro-tax increase Republican being lionized in
the media. With Establishment Republicans snarling at Kemp and, in
a lower voice, Reagan himself.
It’s the oldest game in town — then and now.
Biographer Hayward notes in detail the sudden media slobberings
over the once hated-by-the-media Dole. Because he had insisted on
raising taxes Dole was suddenly winning accolades from liberal
outlets such as the Boston Globe, Time magazine,
the New Republic, and the Baltimore Sun.
Here in the 1982 pages of The American Spectator,
Tom Bethell was once again writing about the eternal liberal media
game of suddenly praising a Republican politician who carried the
liberal water. Bethell had repeatedly pointed out that when a GOP
politician does this, stories mysteriously blossom in the liberal
media about how X has “grown in office.” Almost like clockwork in
1982, George McGovern — defeated two years earlier for his South
Dakota Senate seat in the Reagan landslide — was quoted in the
press as saying exactly that: “Bob Dole has grown.”
How does all this translate to the realities of the fiscal cliff
battle of 2012 — yet another fiscal cliff caused by
massive government overspending?
Other than taking what Reagan himself called the “bitter
medicine” on those excise tax hikes — officially the Tax Equity and
Fiscal Reform Act or TEFRA — Reagan was like a rock in holding on
to principle. He walked out of the Reykjavik summit with Gorbachev
rather than give up the Strategic Defense Initiative. He fired the
air traffic controllers over the objections of a tremendous liberal
media chorus. He insisted on challenging the Soviets in Grenada,
Nicaragua, and Central America generally. He never wavered in his
opposition to abortion. And he came back for another round of tax
cuts — which he got — after his 1984 landslide re-election.
Was it tough?
Of course.
But if there’s one thing today’s House Republican dissidents can
take both heed and heart from, it’s that both Reagan and their
former House colleague Kemp stayed the course with their beliefs.
The one time Reagan wavered… he regretted it.
The current drama playing out in Washington over the fiscal
cliff is identical in many respects to the drama of the 1980s.
This time, instead of Bob Dole being accused of being “the tax
collector for the welfare state” the name attached is John
Boehner.
It is a political tag that should send shivers through those
Republicans willing to abandon tax rate cuts — thinking they can
somehow appease the unappeasable Obama media machine. A machine set
to blame Republicans no matter what they do. Just as they blamed
both Reagan and George H.W. Bush after the two had signed
on to the liberal demands of the day for tax increases.
It will be interesting over the next few days and months to see
how many House and Senate Republicans are prepared to give a
Republican primary challenger the ammunition of saying:
My opponent in this Republican primary is serving as the tax
collector for Barack Obama’s welfare state.
We will see.
And a Happy New Year to you.
