Friday, October 31, 2008

I Did Not Know This


Probably the greatest blow Ronald Reagan struck against American liberalism was changing tax law so as to index income tax brackets to the Consumer Price Index. Before that, each and every year inflation created a small tax hike. Consequently, the default scenario was for revenue to grow. That created a situation where for three decades following the end of World War II, politicians steadily increased the volume of public services while also offering the occasional tax cut. And until the economic malaise of the 1970s, voters liked the outcomes just fine. But by seizing the opportunity provided by the 1980 election to change this, Reagan was able to shift the structure of American politics in a fairly significant way. In many ways the biggest challenge facing an incoming progressive administration backed by progressive congressional majorities is to find some equivalent measures — things you can pass at a moment of political strength whose impact will continue to be felt long after that political moment fades.

No comments: