Word: lekachman
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Dates: during 1980-1989
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...likely to trickle down to workers in the form of more jobs and in come. But the problem--how to increase productive investment in the U.S. economy--is still with us and is indeed the main economic issue facing America in 1980s. Given the evident failure of Reaganomics, Lekachman argues, the democratic left must address this issue creatively and realistically...
...cuts in social spending, Lekachman says that, contrary to Administration work ethic homilies, cutting welfare benefits to the working poor will discourage work in many cases. Of course, the Reagan budget cuts are designed to wean us of our dependence on Washington. But Lekachman makes the more realistic suggestion that the cuts will merely intensify the politically divisive scramble among interest groups to get on board the rapidly departing federal gravy train...
...third pillar of Reaganomics is of regulation, designed to relieve business of "unnecessary" costs. Lekachman, however, reminds his readers of two important facts about government regulation. First, government regulation arose not because of bureaucratic stupidity, but because of public disgust with pollution, unsafe products and hazardous working conditions. Second, the public complained because it was bearing the coats--e.g., in higher doctor bills--for corporate irresponsibility. Deregulation restores to Americans the privilege of paying the costs of the "negative externalities" of modern industry...
...Finally, Lekachman challenges the fourth element of Reaganomics: tight money. At best, he argues, such a monetarist approach to inflation is problematic: No one really knows what the money supply in, and it's also impossible to control the enormous supply available in Eurodollar markets. In any case, the Administration's Thatcherian approach to Federal Reserve Policy flies in the face of its expansionary tax cuts. Tight money keeps interest rates high, thwarting the heralded supply-side investment boom and eroding investor confidence. Meanwhile, the jittery rich--hardly the bold innovators of George Gilder's mythology--put their tax cuts...
...Lekachman, in the weakest passage of his argument, suggests that such a program is possible only under "friendly fascism"--an authoritarian national security state smilingly led by Reagan. Maybe, But it's worth remembering that Felix Rohatyn was most popular in the Carter White House Reagan's ideology has no place for most government-based reindustrialization plans...