Yesterday's indictment of former Reagan budget director David Stockman was cause enough for the Washington Post's Jeffrey Birnbaum to use Stockman's personal ethical and possibly criminal lapses in the private sector as a way to lodge liberal attacks on the Reagan tax cuts. But that was just the beginning for Birnbaum, who, in a Washington Post chat later that day, said that "without question, the Reagan tax cuts went too far."
Four paragraphs into his March 27 Business section story, Birnbaum found a Stockman critic to assail the Reagan fiscal policy that Stockman defended in the late president's first term.
"I have vivid memories of his misusing and misstating data and using obviously phony economic forecasts," said veteran budget analyst Stanley E. Collender. "You wonder if those were habits that stuck with him when he became a Wall Street deal-maker."
Collender may be a crack budget analyst, but he's also politically active. A search of OpenSecrets.org found Collender gave $1,000 to Hillary Clinton (D-N.Y.) in her first Senate race in 2000.
Stockman rose from the back bench of the House, where he served from Michigan, to become Reagan's budget director at the precocious age of 34. He became the White House's detail man in one of the most audacious fiscal experiments of the last 50 years -- a real-world test of supply-side economics. The theory held that marginal tax rates could be cut and yet still produce greater revenue for the government because of increased economic growth.
Of course some might say that the Kennedy tax cuts in the 1960s, had similar supply-side effects on the nation's economy and the Treasury's coffers, but that was not mentioned here either.
Later in his article, Birnbaum turned to a liberal Republican and a liberal Democrat to assailt to Stockman's budget projections and Reagan tax cuts. Yet no consideration was given to the role that rampant federal spending under a Democratic Congress played in growing the federal deficit in the 1980s:
Former senator Warren Rudman (R-N.H.) serves on the board of Collins & Aikman. He joined at the request of Blackstone's senior chairman Peter G. Peterson, a longtime friend of his. "I never had any problem with him personally," Rudman said. "I had plenty of disputes when he was OMB director, the same disputes that everybody else had -- I didn't believe his budget numbers and it turned out that the budget numbers were wrong; they were overly optimistic."
"I thought he was very bright, but intellectually a little dishonest, as he later acknowledged," said Rep. Barney Frank (D-Mass.), now chairman of the House Financial Services Committee. "He never thought that cutting taxes was going to generate revenue."
Of course, all of this stuck out at me when I read it this morning, but the icing on the cake was Birnbaum's admission that he himself though Reagan had gone too far in cutting taxes. Portion in bold is my emphasis:
District of Columbia: I see that you wrote the David Stockman story. Did supply side economics work or was Stockman a fraud?
Jeffrey Birnbaum: I try not to take sides on that fight. I think there clearly is a benefit to the economy from lower tax rates, but whether the amount of extra tax revenue that brings in, due to higher economic growth, can be quantified with any certainty I do have doubts about. Without question, the Reagan tax cuts went too far and did have to be taken back over the next few years. But whether more limited tax cutting would have worked out just fine, we will never know. That's probably a shame.