Back when he was first announced as co-chairman of the Obama administration’s debt commission, former Republican Senator Alan Simpson (WY) bucked today’s conservative orthodoxy by saying that the commission needed to consider tax increases as well as spending cuts to get long-term deficits under control. “To say that all we have to do is take care of waste, fraud and abuse, and foreign aid is a like a sparrow’s belch in the midst of typhoon,” he said. “That is nothing, less than 1 percent of the budget.”
Simpson has garnered criticism from the right for his stance. “He’s old and grumpy, and he doesn’t like the Reagan Republican Party,” said anti-tax crusader Grover Norquist said. Simpson was not cowed, however, and today went back on the offensive, slapping down the conservative ethos around Ronald Reagan and his supposed resistance to any and all tax increases.
At a public hearing of the commission, Simpson said that one of the “myths, and the misconceptions, and the distortions and, as one president said, the plain damn lies” promulgated by the right is that Reagan didn’t raise taxes when the situation called for it. As Simpson pointed out, he most certainly did:
Let’s just disengage ourselves from the myth that Ronald Reagan never raised taxes. He did. And here are four big ones. So I hope this will clear the air for some of the groups today. In 1982, the Tax Equity and Fiscal Responsibility Act, that rolled back about a third of his ’81 tax cuts, raised corporate tax rates, and to a lesser extent income tax rates. Raised taxes by almost one percent of GDP, which at that time was the largest percentage in peacetime increase ever. 1982 gas tax increase, 1983 Greenspan commission raised payroll taxes…Then there was the 1984 deficit reduction tax…Then there was the Railroad Retirement Revenue Act, Consolidated Omnibus Budget of ’85…So there were a lot of them. Just thought I’d throw that in.
“Reagan was more pragmatic than those who now quote him,” said former Sen. Pete Domenici (R-NM), who also is of the opinion that tax increases must be on the table to deal with the long-term deficit. “Those who claim they’re better Republicans than we are — put their solutions in front of us and let’s see if they’re doable.”
As former Reagan economic official Bruce Bartlett wrote, “every serious budget analyst — I mean every — knows that revenues must be part of the solution to our deficit problem…[T]he idea that we can or even should embark on serious deficit reduction with no tax increase whatsoever is grossly immature and unworthy of consideration.” But that is the idea that the modern conservative movement clings to, as unrealistic as it is.