A tearful George W. Bush hailed Reagan‘s “principled stand against totalitarianism, against communism“. According to the right‘s view of history it was Reagan who brought down Stalinism in the Soviet Union. He was perhaps the most right-wing US president of the 20th century, infamous for political gaffes, and an inspiration for today‘s ruling clique – Bush, Cheney and Rumsfeld.
The policies implemented on Reagan‘s watch, for example in sponsoring right-wing terror in Afghanistan, Pakistan and the Middle East, have rebounded on US capitalism with catastrophic results. His economic doctrine – ‘Reaganomics‘ – which saw the rise of today‘s ‘casino economy‘, will at some stage also rebound on its creators with potentially even more devastating effects.
Reagan presided over a transformation of the Republican Party, which became increasingly dependent on the Christian fundamentalist right. Together with Margaret Thatcher, who ruled Britain during the same period, Reagan spearheaded a global neo-liberal counterrevolution, the main ingredients of which were privatisation, deregulation, welfare cuts and the blind worship of ‘free markets‘. This was a new right: the post-war period‘s pretence at ‘consensus‘ was dumped in favour of raw class politics in the interests of the ruling elite.
Reagan attacked the trade unions, for example, by sacking 12,000 striking air-traffic controllers in 1981 and throwing the union‘s leaders in jail. This was done to introduce the ‘flexible‘ labour markets which have since become the model for capitalist governments everywhere. Unemployment in the US shot up to a post-war record of 11.3% in 1983. Reagan also cut welfare programmes (although not on the same scale as Bill Clinton did in the 1990s) – lashing out at “welfare queens“. An attempt to reclassify ketchup as a vegetable featured in his cuts in the school meals service.
Despite demonising ‘big government‘, Reagan‘s policies led to the biggest Federal budget deficits yet seen (a record which George W. Bush has since beaten). As a result of huge tax cuts for the rich and increased military spending, the national debt tripled to $3 trillion under Reagan. He was unabashed: “the deficit is so big, it takes care of itself“. Even Bush‘s father, before he became Reagan‘s vice president, dismissed these policies as ‘Voodoo economics‘. The result was social polisarisation: soup kitchens in the cities side by side with the ‘yuppie‘ phenomenon of new-rich market speculators.
According to the myth, Reagan was a popular leader, but only 52% took part in the 1980 presidential election. Just one in four of those eligible to vote chose Reagan over his Democrat opponent, president Jimmy Carter. The Carter years (1977-80), following US imperialism‘s retreat from Vietnam, where marked by a deepening economic crisis. Reagan‘s policies, for example, deregulation of the telecom and media sectors, were in fact a continuation and deepening of the policies Carter had initiated. This was also the case with foreign policy.
Carter‘s arming and training of right-wing Islamist guerrillas in Afghanistan was intensified. Osama bin Ladin & Co were saluted by Reagan as ‘freedom fighters‘ in the struggle against the ‘Evil Empire‘ of the Soviet Union. Similarly, Reagan stepped up economic aid to death squads and right-wing dictatorships in what US capitalism regarded as Its ‘back-yard‘, Latin America.
This gave rise to the biggest scandal of the Reagan years, the Iran-Contra affair, when his administration sold arms to Iran‘s theocratic dictatorship and illicitly sent the money to the Contra guerillas conducting a bloody terror campaign against the left-wing government in Nicaragua. As part of Reagan‘s “stand against totalitarianism“, Donald Rumsfeld was sent to Baghdad to sell arms to Saddam Hussein in 1983.
On a visit to Berlin in 1987, Reagan declared, “Tear down this wall Mr Gorbachev“, to the last Soviet leader. In reality, however, the Berlin Wall was brought down by a mass rebellion against Stalinism in East Germany and the other countries of Eastern Europe – a movement which at first alarmed both the capitalist ruling class in the West and the ruling stratum in the East. The causes of Stalinism‘s collapse – the huge potential of the planned economy was strangled by bureaucratic misrule – have been analysed at length in CWI material. To claim, as the right do today, that Reagan‘s armaments programme was responsible for this collapse, is a crude simplification.
The Reagan years were, nevertheless, a turning point in the history of world capitalism. The neo-liberal offensive initiated by Reagan and Thatcher reshaped world politics – with increased capitalist globalisation and the shift to the right of the old workers‘ parties as a result. That two blinkered, not to say stupid, politicians should have become modern capitalism‘s two greatest visionaries says a lot about how decrepit and parasitic the system is. The 1980s was about restoring the profitability of the capitalist system at any price – with a return to an earlier era‘s extreme class polarisation. None of the system‘s fundamental problems have been solved by these policies. On the contrary, an explosive economic and political crisis for US and world capitalism is Reagan‘s legacy to the world.
The article was printed in Offensiv (10 June 2004), the weekly paper of Rättvisepartiet Socialisterna (cwi Sweden)