Fiscal History of Reagan Years

* In Column Left (Sept. 3), Robert Scheer fails to provide rigor of thought to match his vigor of style. Along with other foolishness, Scheer badly misrepresents the fiscal history of the Reagan years.

The great increase in the federal deficit did not reflect a “disastrous tax cut of his first year.” Scheer himself notes a series of tax increases beginning in the second year. And tax collections show for decades a strikingly steady ratio to gross domestic product, ranging at about 18-19%, with a slight upward trend from the late 1940s.

The ballooning deficit after the 1960s stemmed entirely from a rapid increase in government spending, which rose from about 19% to 23% of GDP. The community has reason to complain about this profligacy, but the complaints are not to be directed to Republicans alone. The ratio of federal spending to national income barely changed in the Reagan years.

These “escalated expenditures” are not found “most dramatically” in defense spending. Military outlays, as a portion both of national income and of the budget, fell greatly and quite evenly from the Korean War period until 1979. Reagan followed the Carter plan to increase the military spending ratio by a modest degree. The increase in defense constituted a small portion of the increase in total spending after the 1950s, which was dominated by transfers, subsidies and grants.

PROF. WILLIAM R. ALLEN

Department of Economics

UCLA

* Scheer is angry that the Richard Darman book about Ronald Reagan’s inept fiscal policy arrives after vital federal programs are destroyed. He could have noted that much the same thing happened earlier in California when Reagan became governor by promising to restore fiscal sanity, and left office with spending having ballooned out of sight.

Scheer could also have noted that every reporter knew or should have known this when Reagan ran for president on his promise to stop deficit spending--and that it was the best kept secret of that campaign.

The oft-damned “liberal press” hasn’t done too badly by the Gipper--and his idolizers who strive to maintain our reputation as a weird folk who vote into office whoever promises the most outlandish fiscal legerdemain.

WILLARD HANZLIK

Seal Beach