Why Republicans Became Anti-Tax Extremists
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On Sunday’s “Meet the Press,” Claire McCaskill pointed outthat she’d met Grover Norquist for the first time backstage, then asked a pretty good question: “Who is he?”
Her point is that Norquist’s visibility and reputation dramatically exceeds his actual political clout. It’s understandable how this has happened. Republicans have evolved over the past three decades into a staunchly anti-tax party, and Norquist is a colorful and endlessly quotable symbol of this absolutism – one who happens to live and work in close proximity to much of the national political press corps. So he gets an awful lot of face time on television and it can sometimes seem as if he and his anti-tax pledge are the reason no Republican member of Congress has voted for a tax hike in over two decades.
But, as Tim Noah wrote last week, Norquist’s actual power in Washington and within the GOP is illusory. In terms of stature and public prominence, he’s been a major beneficiary of the party’s opposition to tax increases – but he hasn’t been the driving force behind it. The real story of the GOP’s modern evolution on taxes played out in several stages, from the late 1970s to the early 1990s.
The first key moment was the advent in the late ’70s of supply-side economics, the theory that minimizing income, corporate and investment taxes would result in perpetual economic growth that would benefit everyone. It was a fringe idea at first, championed by economist Arthur Laffer and a handful of Republican members of Congress, most notably Jack Kemp. At the time, the GOP was locked in something of a civil war, between the moderate old guard and a rising New Right. In the 1976 primaries, Ronald Reagan had nearly led the conservative wing to victory over President Gerald Ford, and in the run-up to his 1980 campaign, Reagan decided to embrace supply-side as one of his major platform planks, cementing it as a conservative principle. In his first year in office, Reagan signed a set of sweeping tax cuts into law, and supply-side became mainstream.
Reagan, it’s true, went on to approve a number of tax increases over the course of his presidency, but it’s the ’81 tax cuts (along with tax reform in 1986, which brought the top marginal rate – which had been at 70 percent when he took office – all the way down to 28 percent) that conservatives tend to remember. The story of the Reagan years, as they came to tell it, was simple: He inherited a stalled economy, slashed taxes, and unleashed record-shattering economic growth. (Never mind that there were other reasons for the sudden surge in growth that began halfway through Reagan’s first term.)
The next key moment came in 1988, when Reagan’s vice president, George H.W. Bush, sought to succeed him. Bush had been with the old moderate wing a decade earlier, and had ridiculed Reagan’s supply-side prescription as “voodoo economics” during the 1980 primaries. To make peace with the moderates, Reagan had put Bush on his ticket that fall, but Bush recognized that Reagan’s wing had won the war. He spent his eight years as V.P. reinventing himself as a conservative true believer, and sought to extinguish any remaining doubts by including in his 1988 convention acceptance speech this emphatic vow:
The Congress will push me to raise taxes, and I’ll say no. And they’ll push, and I’ll say no. And they’ll push again, and I’ll say to them, “Read my lips: No new taxes.”
It was the most memorable line of the 1988 campaign, but the problem was that Bush didn’t actually mean it. He was still at heart an Eisenhower Republican. And so, confronted with the massive deficits Reagan had left over, Bush put together a deal with Democratic congressional leaders in 1990 to raise taxes. Actually, Republicans were in on it too – at least at first. At the time, the top Republican in the Senate (Bob Dole) and the top Republican in the House (Bob Michel) were also Eisenhower-types who’d never been comfortable with supply-side. So they joined with Bush, and the expectation was that most of the party would fall in line too. Which brings us to the third key moment in the GOP’s evolution: the ’90 revolt.