Flashback: Reagan Proposed Tax Hikes, Unemployment Benefits Extension

July 14, 2011 3:52 pm ET — Jamison Foser

President Ronald Reagan

If you're wondering just how extreme the current Republican Party has become, just compare its economic dogmatism with the early-1980s speeches of then-President Ronald Reagan, the most revered figure in the history of the GOP. An enthusiastic anti-government crusader who slashed taxes (and ran up massive deficits) while denouncing apocryphal welfare queens, Reagan was still more reasonable than his modern-day counterparts. Current Republicans, for example, will tell you that even considering any form of revenue increase, including the closing of tax loopholes they say they don't like, is essentially treason. Well, here's Ronald Reagan, in his 1983 State of the Union address:

[B]ecause we must ensure reduction and eventual elimination of deficits over the next several years, I will propose a standby tax, limited to no more than 1 percent of the gross national product, to start in fiscal 1986.

More Reagan, this from his 1984 State of the Union address:

We must bring down the deficits to ensure continued economic growth. [...] Now, I believe there is basis for such an agreement, one that could reduce the deficits by about a hundred billion dollars over the next 3 years. We could focus on some of the less contentious spending cuts that are still pending before the Congress. These could be combined with measures to close certain tax loopholes, measures that the Treasury Department has previously said to be worthy of support.

So, in the 1980s, Republican icon Ronald Reagan proposed new taxes, and the closing of tax loopholes, to reduce the deficit. He didn't just quietly acquiesce to them — he proposed them in his State of the Union addresses. Maybe you're thinking that things were different then, and American taxpayers didn't face the crushing tax burden from which Republicans are now trying to rescue us? Well, things were different then — the top marginal tax rate was 50 percent.

At a time when the top tax rates were much higher than they now are, Ronald Reagan proposed new taxes, and the closing of tax loopholes, to reduce the deficit. Current Republicans, meanwhile, refuse to close tax loopholes for massively profitable companies — even loopholes they say they don't like — because, they claim, anything that increases government revenue is inherently immoral.

A desire to increase revenue in order to close budget deficits isn't the only economic proposal in Reagan's early State of the Union addresses that today's leading Republicans would likely denounce as job-killing socialism. In his 1983 address, Reagan declared "We who are in government must take the lead in restoring the economy" — a sentiment that would make the current government-doesn't-create-jobs crowd blind with anger. And take a look at how Reagan wanted the government to fix the economy:

No domestic challenge is more crucial than providing stable, permanent jobs for all Americans who want to work. The recovery program will provide jobs for most, but others will need special help and training for new skills. Shortly, I will submit to the Congress the Employment Act of 1983, designed to get at the special problems of the long-term unemployed, as well as young people trying to enter the job market. I'll propose extending unemployment benefits, including special incentives to employers who hire the long-term unemployed, providing programs for displaced workers, and helping federally funded and State-administered unemployment insurance programs provide workers with training and relocation assistance. Finally, our proposal will include new incentives for summer youth employment to help young people get a start in the job market.

Compare that to current Republicans like Sen. Tom Coburn (R-OK) or Rep. Michele Bachman (R-MN) — currently leading the GOP presidential field in Iowa — who have opposed the extension of unemployment benefits in the midst of the worst jobs crisis in decades.

To be sure, Reagan's speeches were filled with economic know-nothingism and supply-side fantasies that would make Rep. Paul Ryan (R-WI) proud. But even Reagan acknowledged the economic and moral imperative of extending unemployment benefits amid a jobs crisis, and that increasing revenues was essential to reducing the deficit. That today's Republican leaders would likely denounce Ronald Reagan as a radical socialist just shows how far 'round the bend they've gone.