Nicole Hemmer, an Associate Professor of History at Vanderbilt and author of 'Partisans,' joins to unravel the depths of supply-side economics and its impact on American politics. She discusses how George H.W. Bush’s unexpected tax hike shaped his presidency and the Republican Party’s future. The conversation dives into the rise of anti-tax pledges and the ideological split within the GOP, led by figures like Newt Gingrich. Hemmer illustrates how these political maneuvers set the stage for modern populism and economic policies that resonate today.
George H.W. Bush's controversial decision to raise taxes in 1990 marked a significant rift within the Republican Party, challenging the anti-tax movement's influence.
The cultural impact of films during the Reagan era highlighted the disconnect between government decisions and public sentiment towards economic policies.
Deep dives
Claudine Schneider and the Reagan Era
In 1990, Claudine Schneider recognized a significant gap in public understanding of the federal government while serving in the House of Representatives. Schneider, who entered politics during the transformative Reagan Revolution, noted that the implications of Reagan's supply-side economic policies, particularly his tax cuts, had permeated society. These policies were often associated with a trickle-down effect that many people did not fully grasp, leading to a disconnection between the government and the electorate. The cultural backdrop of this era included influential films like 'Ghostbusters' and 'Back to the Future Part II,' which both reflected and critiqued the political climate, highlighting the growing disconnect between government actions and public sentiment.
George H.W. Bush: A Complicated Heir
George H.W. Bush's presidency has often been viewed through the lens of his complex relationship with the Reagan Revolution. After losing the 1980 presidential nomination to Ronald Reagan, Bush allied himself with the Reagan administration as vice president, despite his previous criticisms of Reagan's economic policies, famously dubbing them 'voodoo economics.' Bush's extensive political background and experience positioned him well for leadership; however, he faced internal party challenges from a faction that viewed him as a moderate out of step with the evolving Republican base. As Bush took office, he grappled with the legacy of Reagan's policies, including substantial budget deficits created by aggressive tax cuts and increased military spending.
The Tax Increase That Changed Everything
In 1990, George H.W. Bush made the pivotal decision to raise taxes, defying his earlier commitment of 'no new taxes.' This decision was shaped by a rapidly deteriorating budget situation inherited from Reagan, which threatened to engulf his administration in political turmoil. Despite Bush's rationale that the tax increases were necessary for deficit reduction, the backlash from hardline conservatives effectively severed his relationship with the anti-tax factions within the Republican Party. As political tensions escalated following this betrayal, figures like Grover Norquist emerged to galvanize the conservative base against Bush, fundamentally altering the landscape of Republican politics.
The Rise of the New Conservative Movement
The 1992 presidential election served as a turning point for the Republican Party, highlighting a growing schism between traditional Republicans and the emerging ultra-conservative faction. Pat Buchanan's primary challenge to Bush personified the frustration of conservatives who felt betrayed by the president's tax policies. Concurrently, the election unfolded against a backdrop of economic dissatisfaction, leading to Bill Clinton's victory and a shift in the political narrative towards an anti-government rhetoric. This shift marked the beginning of a more aggressive anti-tax movement, driven by the belief that government intervention and spending were the root of economic woes, setting the stage for future political realignments.
Former President George H.W. Bush once thought supply-side economics was so ludicrous he deemed it “voodoo economics.” But that was before Ronald Reagan transformed the Republican Party into a trickle-down, tax-cutting cult.
To follow in Reagan’s footsteps, Bush promised conservatives that he would never raise taxes — but then did something nobody expected. That decision would seal his fate, with the anti-tax movement making sure no Republican ever dared cross them again — and that included Bush’s son.
This is Part 3 of Tax Revolt, a new miniseries from Lever Time revealing how free-market radicals hijacked American politics and set the stage for Elon Musk, DOGE, and Donald Trump’s presidency.
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