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Reagan's Victory
The Presidential Election of 1980 and the Rise of the Right
Andrew E. Busch
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Reagan's Victory
The Presidential Election of 1980 and the Rise of the Right
Andrew E. Busch
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Many have pointed to the Iran hostage crisis, others to galloping inflation. In reality, as Andrew Busch makes clear, Ronald Reagan's defeat of President Jimmy Carter in 1980 was attributable to more than any one issue, no matter how galvanizing. It marked the growing ascendancy of conservative attitudes that had been brewing for two decadesâand marked the clear end of the era of New Deal liberalism.Busch offers the first comprehensive study of this contest, going beyond journalistic accounts to show why it remains one of the truly landmark elections of the past century. Through a compelling story full of colorful characters, unexpected plot twists, and dramatic finales, he reveals how it both reflected the politics of its time and foreshadowed our nation's political future.Beginning with Carter's "crisis of confidence" speech on July 15, 1979, Busch introduces the field of candidates, follows their campaigns through the primaries and general election, identifies the key turning points and winning strategies, and assesses the results, including the GOP's first Senate majority in twenty-six years. He shows how the Democrats were weakened by the demise of the New Deal coalition and a decline in public confidence, while Republicans were bolstered by the growth of the conservative movement and by all that had gone wrong during the Carter presidency. He also examines the creation of a Sunbelt coalition, the growing influence of religious conservatives, and the independent candidacy of John Anderson, which held Reagan's majority to 51 percent and foreshadowed Ross Perot's 1992 run. Reagan's victory marked a major turning point in American presidential history, realigned the demographics of party affiliation throughout the nation (especially in the nation's Sunbelt), and gave conservatives their first real victory in their fight against Big Government. Busch's book recaptures the people and events of that historic campaign and greatly enlarges our understanding of American politics from the 1960s to the present.
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1 | CRISIS OF CONFIDENCE |
It was July 15, 1979, and America seemed to be unraveling.
As the presidential election of 1980 approached, the nation was caught in a maelstrom of economic, social, and foreign woes that presaged not only a difficult reelection campaign for incumbent president Jimmy Carter but the potential for a broader break with the past. After sequestering himself at Camp David for ten days of contemplation, soul-searching, and meetings with hundreds of intellectuals, political leaders, and ordinary citizens, Carter returned to Washington and addressed the country in a prime-time speech in which he declared that Americans were suffering from a âcrisis of confidenceâ:
It is a crisis that strikes at the very heart and soul and spirit of our national will. We can see this crisis in the growing doubt about the meaning of our own lives and in the loss of a unity of purpose for our nation. The erosion of confidence in the future is threatening to destroy the social and political fabric of America. . . . Weâve always had a faith that the days of our children would be better than our own. Our people are losing that faith.
The speech was soon dubbed the âmalaiseâ speech by the media, although Carter never used the word âmalaise.â The source of the crisis was a matter of dispute. Carter implied that the American people themselves had failed. Others, in both parties, soon took up the argument that it was Americaâs president who had failed. Carterâs own advisers had been sharply divided about whether he should give the speech. Regardless, the crisis Carter described was rooted in a number of solid realities, including economic decline, foreign policy retreat, and social deterioration.
At the same time, the political ground was shifting under the presidentâs feet. The Democratic coalition that had dominated U.S. politics since the New Deal was waning, and a conservative movement long dismissed by its detractors as hopelessly anachronistic was surging. Carter had run a winning campaign against Washington in 1976, but no one knew how long the day of the outsider would last. And the midterm elections of 1978 had altered the landscape, removing five notable liberal senators and driving congressional politics to the right.
The most tangible facet of the crisis of 1979 was the deteriorating state of the economy. In the mid-1960s, the U.S. economy had been a model of job creation, increasing wages, and low inflation (1.3 percent in 1964). As the costs of the Great Society and the Vietnam War escalated, costs paid in both taxes and deficits, inflation began to climb. The Dow Jones Industrial Average peaked in 1973 at around 1,050 and did not regain that level for the rest of the decade. The good times were over.
The nation slipped into a recession in late 1969 and 1970, and by 1970 inflation had reached 5.7 percent. In August 1971 President Richard Nixon imposed federal wage and price controls in an effort to stem the tide of rising prices. He also devalued the dollar to relieve international pressure on the U.S. currency.
Due to the distorting effects of price controls, which remained on oil even after they were ended on most goods, Americans experienced gasoline shortages in the summers of 1972 and 1973. In the fall of 1973 the energy situation took a dramatic turn for the worse. When the United States staved off the impending defeat of Israel by Egypt and Syria with an emergency airlift of supplies to Israel during the Yom Kippur War in October, the Arab oil-producing states retaliated by cutting off oil supplies to the United States. The price of oil rose almost overnight from three dollars a barrel to twelve dollars a barrel. This economic shock was followed by more shortages, a leap in inflation to 11 percent in 1974, and another, deeper recession, with unemployment averaging 8.5 percent in 1975. Although the economy had been experiencing difficulties since the late 1960s, 1973 was the point at which almost all key economic indicators, including productivity, the basis for future prosperity, headed downward for the rest of the decade. The poverty rate reached a historic low in 1973 at 11.1 percent, then began climbing again.
President Jimmy Carter delivering his July 15, 1979, address to the nation from the Oval Office. The speech was quickly dubbed the âmalaiseâ speech by the media.
The nation was consumed for the better part of the 1970s with two intertwined economic crises: the crisis of economic performance and the energy crisis that contributed to it. Soon after taking office, Carter made energy policy the first order of business, declaring âthe moral equivalent of warâ and pushing Congress to create the cabinet-level Department of Energy in 1977. Administration officials and many outside analysts predicted that energy shortages would grow and that steadily increasing prices would reverberate throughout the economy. In 1979, with another oil shortage driven by the victorious Iranian revolution in February and by a 24 percent price increase by the Organization of Petroleum Exporting Countries (OPEC) in June, inflation reached 11.3 percent. A wildcat strike by truckers protesting higher fuel costs turned violent as strikers blocked highways, shot at or stoned truckers who defied the stoppage, and kept food from reaching stores. Interest rates were climbing in order to protect lenders from anticipated future inflation. The United States was approaching yet another recession.
The statistics show only part of the economic shocks jolting the country. One after another, American icons fell on hard times. In 1975 New York City was verging on bankruptcy. By 1979 so was the Chrysler Motor Company, a warning of the gathering failures of the American automotive industry, one of the linchpins of the U.S. economy. The choices faced by U.S. policymakersâto let the giants fall or to approve costly bailoutsâwere miles removed from the economic choices of the sunny 1960s, when it had seemed that all government had to do was decide how to distribute an ever-increasing pie.
Throughout this period, from 1960 to 1980, the federal government continued expanding in size and scope, owing to the ethos of the New Deal and the momentum of the Great Society. Decades earlier, Franklin Roosevelt had launched a radical reconception of the role of government. His new public philosophy advocated federal action in realms long thought to be the province of state and local authorities or of private civil society. Moreover, the traditional American conception of rights had emphasized natural rightsârights such as life, liberty, and property naturally enjoyed even before the formation of governmentâand consequently the protection of individuals against the abuses of government. Roosevelt offered a new framework emphasizing positive economic rights. In his 1932 Commonwealth Club Address in San Francisco, Roosevelt argued that the natural rights of the Declaration of Independence found a counterpart in the new rights to secure savings and to make a comfortable living. By 1944 Roosevelt was calling in his State of the Union Address for an âEconomic Bill of Rightsâ including a ârightâ to a job, housing, health care, a good education, and security from the âeconomic fears of old age, sickness, accident, and unemployment.â
Rooseveltâs use of traditional rights language and the traditional rights framework disguised the degree to which the new conception of rights might undercut the older notion. Not least, whereas the older notion required limited government and placed a high priority on property rights, the newer notion permitted a theoretically unlimited government and required a highly activist and redistributionist one.
With Rooseveltâs new public philosophy as a foundation and the New Deal programs as an example, President Lyndon B. Johnson launched the next wave of federal expansion with his Great Society programs of the 1960s. Although the Great Society included new regulatory forays and broad new entitlements, such as Medicare, it featured a âWar on Povertyâ consisting of Medicaid, liberalized welfare, and literally dozens of smaller antipoverty programs. Johnsonâs successor, President Richard Nixon, demanded something of a retrenchment, calling for a more decentralized âNew Federalismâ and less welfare. However, in many respects, Nixonâs policies are best understood as a continuation of the Great Society era, not a break with it. Along with federally imposed wage and price controls, Nixon created such major regulatory agencies as the Environmental Protection Agency (EPA) and Occupational Safety and Health Administration (OSHA), oversaw a 20 percent increase in Social Security benefits, and proposed a guaranteed-income plan and national health insurance.
Consequently, between 1960 and 1980 federal spending increased from $92 billion to $591 billion and federal revenues jumped from $92 billion to $517 billion. Even adjusted for inflation, spending essentially doubled. This growth was the result of increased domestic spending. Whereas defense spending had accounted for close to 50 percent of all federal spending in 1960, it had dropped to less than a quarter of all federal spending twenty years later. Average annual deficits rose in real terms in every administration. The annual deficits during the administrations of John F. Kennedy and Lyndon Johnson were 139 percent higher than those of Dwight D. Eisenhowerâs administration. Average deficits during the administrations of Richard Nixon and Gerald Ford were 111 percent higher than the Kennedy-Johnson deficits, and Jimmy Carterâs were 57 percent higher than the Nixon-Ford deficits. In real terms, annual average deficits in the Carter years were eight times higher than under Eisenhower. Pages in the Federal Register, a rough indicator of regulatory activity, increased from 16,850 in 1966 to 87,012 in 1980.
Furthermore, in 1979 the top federal income tax rate was 70 percent, and the fourteen tax brackets were not indexed to inflation. This meant that working families were being increasingly pushed into higher tax brackets because of raises that might not even have kept up with inflation. A family making $25,000 in 1978 would have seen the tax rate on its last dollar of income increase from 19 percent in 1965 to 28 percent in 1978 if its income had exactly kept pace with inflation. For individuals caught in this squeezeâand there were millionsâthe federal government was increasingly unpopular.
In other respects, economists and politicians debated whether the explosion of federal taxing, spending, and regulating since 1960 had contributed to the economic meltdown or merely coincided with it. By 1979, however, it could hardly be disputed that the economy was in serious trouble and that, at the very least, the liberal economic regime had failed to either prevent or resolve that trouble. Indeed, the economic experience of the 1970s threw the dominant economic paradigm of the time into disarray.
That paradigm was Keynesianism, the economic theory that government should manipulate aggregate demand through tax and spending policies in order to speed up the economy (in recession or depression) or slow it down (during times of inflation). A Keynesian corollary, the Phillips Curve, held that there was a mathematical tradeoff between inflation and unemployment: When one went down, the other would go up. The economy of the 1970s refuted this notion, as unemployment and inflation rose in tandem. âStagflation,â the term coined to name this situation of a stagnant inflationary economy, thus called into question the validity or relevance of Keynesianism itself.
Many voices held that Americaâs economic heyday was past and that the nation would have to learn to live with a future of little or no economic growth. Carter himself subscribed to a version of this view, holding that âlimits to growthâ would be a central feature of American life. The economic crisis was so severe and so disorienting that many observers across the political spectrum even questioned whether the free-market economic system would survive. The July 12, 1975, cover of the Saturday Review asked, âCan Capitalism Survive Another 30 Years?â Gurney Breckenfeld was pessimistic: âThe way we are moving now, the private-enterprise system as we know it could well disappear in another 30 years. The problems are accumulating faster than the existing political-economic system can cope with them.â1 These sentiments were echoed by Alan Greenspan, then the chair of President Fordâs Council of Economic Advisers; Greenspan told a congressional committee that the nation was rapidly approaching a âdecision pointâ about whether a free-market economy would endure.
Time magazine likewise featured a July 15, 1975, cover story entitled âCapitalism: Can It Survive?â The answer: Probably. Robert Heilbroner, liberal economist and Nobel Prize winner, asked the same question in a New York Times Magazine article of August 5, 1982. His answer was that capitalism might survive, but only through a radical restructuring that would leave the public sector in control of 40â50 percent of the national economy accompanied by much greater national economic planning; permanent government controls of wages, prices, and dividends; and massive government investment in private industry.2
Economic pessimism could also be seen in widespread skepticism that technological innovation could provide a solution for economic woes, a skepticism unprecedented for Americans. The near-catastrophic breakdown of sophisticated technology in an accident at the Three Mile Island nuclear power plant in Pennsylvania in March 1979 reinforced this view. More generally, apocalyptic visions became commonplace, including fears of a âpopulation bombâ (Paul Ehrlichâs phrase for an explosion in population that would lead to a Malthusian future of food and natural resource shortages) and of environmental catastrophe (including, according to the theory of the moment, global freezing).
If spreading economic disaster was the most tangible cause of the âcrisis of confidence,â the position of the United States in the world was a close second. Ben Wattenberg, a conservative Democrat who headed the Coalition for a Democratic Majority, captured that state in a July 1979 New York Times Magazine article entitled âItâs Time to Stop Americaâs Retreat.â After the agony of war in Southeast Asia, the United States had sought respite from the world, starting with the congressional decision in 1974 and 1975 to end all further assistance to South Vietnam. In a five-year-long moment of neo-isolationism, the United States cut its defense budget substantially, imposed severe restrictions on the Central Intelligence Agency (CIA), and sought âdĂ©tenteâ with the Soviet Union. In the words of scholar John Lewis Gaddis, the policy of containment, pursued by presidents of both parties since 1947, had âreached a point of crisis, if not a dead end.â3
However, U.S. disengagement from the Cold War was not reciprocated by the Soviet Union. Between January 1, 1975, and August 1, 1979, Soviet advances began with Communist victories in South Vietnam, Cambodia, and Laos after Congress cut off aid to U.S. allies there. The former Portuguese colonies of Angola and Mozambique fell next, after Congress cut off aid to pro-Western fighters in Angola. Some 5,000 Cuban troops intervened in that countryâs civil war, while Cuban arms and advisers helped consolidate Communist control of Mozambique. In Ethiopia, Cuban troops and Soviet advisers intervened to aid the new government of Col. Haile Mengistu Mariam. South Yemen fell, lodged nearly 1,000 Cuban troops and advisers, and attacked North Yemen. Both Ethiopia and South Yemen gave the Soviets access to strategically vital ports and airfields with which to threaten the Persian Gulf and Indian Ocean. In Afghanistan, an April 1978 coup brought to power the Afghan communist party, promptly provoking resistance by anticommunist Afghans. By mid-1979, there were 5,000 Soviet advisers in the country.
Closer to home, Communists seized power in Grenada, a small island in the eastern Caribbean, which soon hosted hundreds of Cuban troops as well as Soviet, East German, and Bulgarian advisers. In July 1979 the Sandinista National Liberation Front (FSLN) took control of Nicaragua, whose dictator Anastasio Somoza fled. Within months, the Sandinistas were shipping arms to Communist rebels in El Salvador. Numerous other countries, such as Suriname, imported Soviet or Cuban advisers and weapons, tilting toward Moscow even when not in its orbit. Throughout this period, the specter of âEurocommunismâ hung over NATO, and Portugal almost tumbled into the Communist bloc in 1975.
In sum, in a period of less than five years, the Soviet empire had expanded by ten countries in Southwest Asia, Southeast Asia, Africa, and the Caribbean basinâall without significant interference from the United States.
Undergirding this imperial record was a substantial Soviet offensive arms buildup. From 1976 to 1980, while U.S. and allied military spending was stagnating, the Soviets built an estimated 13,500 tanks, 6,300 fighter planes, 900 submarine-launched ballistic missiles, and 1,200 land-based intercontinental ballistic missiles (ICBMs), including the first-strike-capable SS-18 and SS-19 heavy ICBMs. In 1977 they also started deploying, at the rate of one a week, triple-warhead SS-20 missiles aimed at western Europe in an attempt to tilt the strategic balance on the continent. From 1970 to 1980, when the United States was cutting military manpower by 1.4 million, the Soviets were adding 400,000 to their armed forces. As far as U.S. intelligence could determine, Soviet military spending had surpassed that of the United States in 1971, and by 1979 was 70 percent greater than that of the United States.4 American hopes that arms control would restrain the Soviet buildup proved unfounded.
Altogether, by the end of the 1970s, despite a few setbacks (as in Egypt, where Anwar Sadat threw out Soviet advisers), the Soviets had good reason to believeâand stated with increasing confidenceâthat âthe correlation of forces had shifted in their favor.â5 Americans faced for the first time the very real prospect of losing the Cold War. Glimpsing the abyss, Wattenberg mused, âSo far, our Western freedoms have represe...