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September 29, 2011 12:35 PM The biggest tax hike in modern American history?

By Steve Benen

It seems hard to even imagine, but in Ronald Reagan’s first term, he signed off on a series of tax increases — even when unemployment was nearing 11% — and proceeded to raise taxes seven out of the eight years he was in office. It’s a record Republicans find terribly inconvenient, but “no peacetime president has raised taxes so much on so many people” as Reagan.

Of particular interest is the “Tax Equity and Fiscal Responsibility Act of 1982,” the largest of Reagan’s tax increases, and generally considered the largest tax increase — as a percentage of the economy — in modern American history. (The ecoomy began booming in 1983, by the way.)

To hear the GOP tell it, President Obama’s debt-reduction plan would break the record and be the biggest tax hike in history. They’re mistaken.

The right’s first mistake is contextual. Reagan approved a massive tax increase during peacetime after inheriting a modest deficit (which he proceeded to grow dramatically), while Obama is recommending a tax increase in a time of war after inheriting an enormous deficit. It’s also probably worth noting that Reagan’s tax hike passed Congress, and Obama’s tax proposal won’t.

But as Brian Beutler reports, the bogus Republican claim also fails as a simple apples-to-apples comparison.

Assessing new revenue as percentage of GDP, it turns out Obama’s tax proposals would rank below a law signed by President Ronald Reagan on the list of significant tax increases of the last five decades. […]

When Republicans call Obama’s plan the biggest tax increase in history, they’re using a “current policy baseline.” In other words, they assume today’s tax rates are fixed, and complain that Obama’s plan would raise revenue thereupon by quite a bit — $1.57 trillion over 10 years. By this measure, as a percentage of GDP, Obama’s “tax hike” is smaller than Reagan’s 1982 Tax Equity and Fiscal Responsibility Act and the Revenue and Expenditure Control Act of 1968 but larger than Clinton’s 1993 tax increases and George H.W. Bush’s 1990 bill, as well as Reagan’s 1984 Deficit Reduction Act.

I know the GOP won’t want to hear this, but Ronaldus Magnus will almost certainly get to wear the crown of Biggest Tax Hiker for a very long while.

Steve Benen is a contributing writer to the Washington Monthly, joining the publication in August, 2008 as chief blogger for the Washington Monthly blog, Political Animal.

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  • doubtful on September 29, 2011 12:45 PM:

    When Republicans call Obama’s plan the biggest tax increase in history, they’re using a “current policy baseline.”

    No, they're lying and assuming (correctly) that the Republicon rank and vile don't know what GDP, inflation or percentages are.

    Grifters gotta grift.

  • c u n d gulag on September 29, 2011 12:50 PM:

    They love the myth of Emperor Ronald Maximus.

    The man, uhm, not at all.

    Cue the late, great Sam Cooke:
    "Don't know much about history..."

    And the rest of the song applies.

    Except the "love" part.
    Conservatives HATE everyone!

    And if they killed all of us off, "What a wonderful world it would be!"

  • jjm on September 29, 2011 12:57 PM:

    With Goebbels as their patron saint, the GOP is certain that big lies will carry the day.

  • Anonymous on September 29, 2011 12:58 PM:

    "To hear the GOP tell it, President Obama’s debt-reduction plan would break the record and be the biggest tax hike in history. They’re mistaken lying."

    Fixed that for you

  • cmdicely on September 29, 2011 1:20 PM:

    The explicit fact claim in "This is the biggest tax hike in modern American history" isn't the important message that is being sent, the implicit value claim ("Tax hikes are always bad, the bigger the tax hike the worse") is the important claim. By debating the explicit fact claim in the way you do, you implicitly validate the implicit value claim, which is actually the politically important message being promoted.

    So, the message worked, and you helped it work.

  • Mark-NC on September 29, 2011 2:44 PM:

    @doubtful above has it exactly right.

    And, once the Repugnant Ones have said this a million times - it will become true!

  • Tony on October 10, 2011 11:53 PM:

    Does it matter to any of you that the tax hike came after a $750 Billion tax cut in 1981. The combined 1982 & 1983 tax hikes raised about $270 Billion. That gives a net cut in taxes.

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