When Democrat presidential candidate Walter Mondale announced in his October 1984 debate with former President Reagan that he would raise taxes if elected, his campaign was over, and he ended up losing one of the biggest election routs in American history.
As Barack Obama prepares to offer the nation his deficit reduction plan Wednesday, it is widely believed he is going to recommend tax hikes on at least the upper wage earners in this nation.
If this is true, is he repeating Mondale's mistake less than nineteen months before Election Day? Are Americans hungrier for tax increases now than they were 27 years ago?
Consider that the economy was absolutely exploding when Reagan and Mondale faced off that October evening. Having grown by 4.5 percent in 1983, the Gross Domestic Product rose by a staggering 8 percent in the first quarter of 1984 and 7.1 percent in the second quarter.
The jobs market was exploding. Having peaked at 10.8 percent in December 1982, the unemployment rate plummeted to 7.3 percent by the time Reagan and Mondale exchanged their versions of the future on national television. The economy had added more than four million jobs since Inauguration Day.
Inflation was also plummeting. When Reagan took office in January 1981, the Consumer Price Index had just risen by 11.8 percent. When he and Mondale debated, inflation was down to only 4.3 percent.
Oil and gas prices were also on the decline with crude going from $37.42 when Reagan took office to under $29 when he and Mondale met. From what I can tell, gas prices had dropped from about $1.50 a gallon to $1.20.
Add to this a huge bull market in stocks as well as real estate, and the economy in October 1984 when Mondale said he wanted to raise taxes was absolutely booming.
Compare that to today. Despite some encouraging signs, one could hardly call what's happening now a boom.
2.8 million more people are out of work than when Obama took office, with unemployment still quite high at 8.8 percent. The housing market is tremendously depressed with some fearing another big decline is on the way.
Inflation is also beginning to be a problem. Though still at only 2.1 percent, it has risen from basically zero when Obama was inaugurated, and looks to go much higher in the coming months and years.
Oil was going for about $40 a barrel in January 2009 versus $106 today causing gas prices to double since Obama took office with fears they're going substantially higher.
Add it all up, and America felt far better about its personal finances in 1984 than it does today, yet it still had no appetite to give government more of its hard-earned money.
With the doldrums folks are in now, and fears they may never be able to retire, are they going to be more interested in giving to Washington's bottomless pit?
To be sure, Obama, his Party, and his devoted media will frame "revenue increases" as tax hikes on the rich that won't impact the average citizen.
But with trillion dollar deficits as far as the eye can see, will John and Jane Q. Public believe that the buck-chasing will stop there and the Democrats won't be soon knocking on their door once the tax increases start?
If not, history could be repeating itself Wednesday, and the 2012 presidential election could be over before most of the candidates have even tossed their names into the ring.