Because he managed to take the Carter "malaise", the gas lines, and "Misery Index" (among other things) of the late 70's and with the exception of the recession in 1981-82, which was primarily a result of S&L failures due to high interest rates, as well as a continuation (aka, "double bounce") of the recession which began in 1980, as well as still-high income tax rates until 1982. Only after inflation was brought under control by the Fed in the middle of 1982 did interest rates begin to decline, as did unemployment, and resulted in a steady increase in GDP. Coupled with the budget cuts and tax cuts (although Reagan DID pass $100 Billion in a 3-year tax increase in 1982 with TEFRA.), unemployment declined from 10.8 percent in November of 1982 to 7.2 percent two years later. Reagan's popularity, which had been in the mid-30's in early 1983 (coincidentally, the same time period the MSM uses to cite the "decline" of conservatism in 2010 America), rose to the point he easily defeated Mondale in 1984.
One might even be able to draw parallels between then and now with the looming "double dip" coming in 2011 and beyond.
The major differences between then and now are these:
--No anticipated tax cut. Quite the contrary, massive tax increases are about to take place in 2011 and beyond.
--No decline in government spending. Under TEFRA, Reagan agreed to the temporary tax increases provided Congress cut spending for $3 for every $1 in tax increases. Under Obama and the Democrat-controlled Congress, we have seen deficits equal to 10 percent of GDP for each of the last two years, more than DOUBLE the highest deficit-to-GDP ratios of Reagan, Bush 41, or Bush 43.
--GDP to debt ratio. Even when Reagan left office in 1989, national debt was only approximately 35 percent of GDP. By 2010, it approaches 95 percent and increasing. More and more of the federal budget is being spent on interest payments on the debt.
--Increases to SSI and other entitlement spending. In the 1980's, the ratio of defense spending to GDP never rose higher than 6.2 percent, while "human resources" spending (Social Security, Medicare, etc) varied between 10.5 and 12.4 percent of GDP, or anywhere between 48.6 and 52.7 percent of all federal outlays. Defense spending was never higher than 28 percent of budget outlays. Today, we spend about 4.2 percent of GDP (or 18 percent of federal outlays) on defense, and 15.5 percent of GDP (or 66.3 percent of federal outlays) on human resources spending. Those latter numbers will increase significantly with the implementation of the healthcare bill between now and 2018, and the aging baby boom population retirement comes into full swing.
With these and other facts in hand:
Oh, shit. It's gonna SUCK in the next few years, people.
