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[Excerpted from Why American History Is Not What They Say (2009)]

Like most Republican politicians since the early 1930s, Ronald Reagan always portrayed himself throughout his political career as a champion of limited government, individual rights, and free enterprise — the classical-liberal values, which, of course, he absurdly described as "conservative." But, like almost all Republican politicians since the early 1930s, he seemed to forget all about these values once he got into office and assumed the reins of power. Consider, as a case in point, Reagan's eight years (1966–1974) as governor of California. As Murray Rothbard noted in 1980,

Despite his bravado about having stopped the growth of state government, the actual story is that the California budget grew by 122 percent during his eight years as governor, not much of an improvement on the growth rate of 130 percent during the preceding two terms of free-spending liberal Pat Brown. The state bureaucracy increased during Reagan's administration from 158,000 to 192,000, a rise of nearly 22 percent — hardly squaring with Reagan's boast of having "stopped the bureaucracy cold."

Nor "is Reagan's record on taxes any comfort. He started off with a bang by increasing state taxes nearly $1 billion in his first year in office — the biggest tax increase in California history. Income, sales, corporate, bank, liquor, and cigarette taxes were all boosted dramatically." After his reelection as governor in 1970, "two more tax hikes — in 1971 and 1972 — raised revenues by another $500 million and $700 million respectively." Overall,

by the end of Reagan's eight years, state income taxes had nearly tripled, from a bite of $7.68 per $1000 of personal income to $19.48. During his administration, California rose in a ranking of the states from twentieth to thirteenth in personal income tax collection per capita, and it rose from fourth to first in per capita revenue from corporate income taxes.

During his 1970 campaign for reelection, Reagan assured voters that his feet were set "in concrete" against adopting payroll withholding of state income tax in California. Less than a year later he was joking that "I can hear the concrete cracking around my feet," as he signed exactly that provision into law.

According to Rothbard, Reagan "created seventy-three new state government councils and commissions, with a total budget, in his last year alone, of $12 million. Included was the California Energy Commission, which put the state hip-deep into the energy business" and created a regulatory climate under which a three-year review process was required before any new power plant could be constructed in the state.

Reagan always claimed to have "reformed" welfare in California during his years in the governor's office. And, as Rothbard noted in 1980, he did remove "more than 510,000 from the welfare rolls by — among other things — forcing adults to support their welfare parents." The problem is that "[h]e then turned around and boosted the amount of welfare paid to those remaining by 43 percent, so that total welfare costs to the taxpayer didn't decline at all."[1]

In 1974, his time in Sacramento at an end, Reagan began running for president. And by the fall of 1980 he had succeeded in winning both the Republican nomination and then the election campaign against the incumbent, Jimmy Carter. In January 1981, he was called upon to deliver his first inaugural address. "For decades," he told Americans,

we have piled deficit upon deficit, mortgaging our future and our children's future for the temporary convenience of the present. To continue this long trend is to guarantee tremendous social, cultural, political, and economic upheavals. You and I, as individuals, can, by borrowing, live beyond our means, but for only a limited period of time. Why, then, should we think that collectively, as a nation, we are not bound by that same limitation? We must act today in order to preserve tomorrow. And let there be no misunderstanding — we are going to begin to act, beginning today.

"It is my intention to curb the size and influence of the Federal establishment," Reagan thundered. "It is time to … get government back within its means, and to lighten our punitive tax burden. And these will be our first priorities, and on these principles, there will be no compromise."

But in fact both taxes and deficits increased under Reagan. As Rothbard put it in a 1988 retrospective on Reagan's years in the White House,

In the first place, the famous "tax cut" of 1981 did not cut taxes at all. It's true that tax rates for higher-income brackets were cut; but for the average person, taxes rose, rather than declined. The reason is that, on the whole, the cut in income tax rates was more than offset by two forms of tax increase. One was "bracket creep," a term for inflation quietly but effectively raising one into higher tax brackets, so that you pay more and proportionately higher taxes even though the tax rate schedule has officially remained the same. The second source of higher taxes was Social Security taxation, which kept increasing, and which helped taxes go up overall.

Moreover, in each of the seven years that followed that phony "tax cut," taxes increased

with the approval of the Reagan administration. But to save the president's rhetorical sensibilities, they weren't called tax increases. Instead, ingenious labels were attached to them: raising of "fees," "plugging loopholes" (and surely everyone wants loopholes plugged), "tightening IRS enforcement," and even "revenue enhancements." I am sure that all good Reaganomists slept soundly at night knowing that even though government revenue was being "enhanced," the president had held the line against tax increases.[2]

As for deficits, Slate's Timothy Noah puts the matter succinctly: "The deficit, which stood at $74 billion in Carter's final year, ballooned to $155 billion in Reagan's final year. In the words of Vice President Dick Cheney, 'Reagan taught us deficits don't matter.'"[3] In the words of syndicated columnist Molly Ivins, "Ronald Reagan came into office in 1980 on the mantra that he would rid the nation of Waste, Fraud and Abuse. He proceeded to raise the national deficit by $2 trillion with tax cuts and spending on the military in the face of a collapsing Soviet Union."[4]

Then there was Reagan's policy on international trade. "Our trade policy," he stated during his 1980 campaign, "rests firmly on the foundation of free and open markets. I recognize … the inescapable conclusion that all of history has taught: the freer the flow of world trade, the stronger the tides of human progress and peace among nations." Then, as president, he acted as though such ideas had never entered his mind. According to Sheldon Richman, Reagan "imposed a one hundred percent tariff on selected Japanese electronic products," explaining that he did so "to enforce the principles of free and fair trade." As president he