Was the Reagan Era a Decade of Greed?

    In a recent Denver Post YourHub column,“Strengthen sacrificial Thanksgiving spirit,” Jack Van Ens bemoans a perceived lack of civic virtue and attacks the late President Ronald Reagan for being blind to “the plight of those shivering in the shadows” during his administration. Van Ens also accuses Reagan of discouraging citizens from personal sacrifice while seeking their own self-fulfillment. Such a biased and ad hominem attack requires a closer look at the facts.

    Van Ens wants us to believe the decade of the 1980s was one long consumption binge, fostered by the Reagan Administration and characterized by what political pundit Kevin Phillips called "conspicuous opulence"  by the rich and powerful to the detriment of the poor and down trodden.  However, this popular leftist canard doesn’t stand up to the facts.

    Measured by giving, the 1980s were not the "Decade of Greed" at all. On the contrary, charitable giving by individuals and corporations jumped dramatically. This finding holds for giving measured not just in absolute terms, but also in total real dollars contributed, real charitable contributions per capita, and charitable contributions relative to national income.

    Indeed, giving in the 1980s was above the level that would have been predicted from the upward trend established in the 25 years prior to 1980. This conclusion holds even after adjusting for several economic and policy changes that might reasonably be expected to have boosted charitable contributions. In view of total, aggregate giving from 1955 to 1989, the 1980s in America were actually a decade of unusual generosity.

    With his leftist viewpoint, Van Ens sees the wealthy and corporations as sinful by nature, and he describes Americans as “bedazzled” by Reagan’s rhetoric calling America a shining city on the hill.  Van Ens tries to make the case that this successful decade was “shorn of sacrifice” for the common good. The truth is that corporate giving in real terms rose during the period increasing in the 1980s at a compound rate of 4.1 per cent. Charitable contributions by corporations as a percentage of profits before and after taxes remained higher in the late 1980s than in the decades preceding.

    The unusual surge in giving in the 1980s could be explained in part by favorable changes in economic conditions during the decade. It might be said that Americans were giving more not because they were more charitable, but because they had higher incomes and varying tax rates. 

    Were the 1980s really the “Decade of Greed" as claimed by Van Ens and often decried by his fellow leftists?  In terms of charitable contributions, the answer is a resounding "No."  No matter how the record of giving is measured, the 1980s were in fact a decade of renewed charity, generosity, and civic virtue.

    As documented in a study by scholar Denish D’Souza, Reagan saved America from a dire economics: he brought inflation down from 13.5 to 4.1 percent; unemployment, from 9.5 to 5.2 percent; the federal discount rate, from 14 to 6.5 percent. Under Reagan, the number of jobs increased by almost 20 million; median family income rose every year from 1982 to 1989. It was the greatest peacetime expansion in American history. Charitable giving more than doubled, to more than $100 billion in 1988. 

    Van Ens wants his readers to believe that Reagan presided over vast giveaways to the rich.  In fact, during the 1980s, the affluent paid more in federal taxes than ever before. Even though the top marginal tax rate declined from 70% to 28%, the proportion of taxes collected from the top 1% of income-earners went from 18% of all revenues in 1981 to 28% in 1988. The top 5% of earners bore 35% of the tax burden in 1981. In 1988, Reagan’s last year in office, they paid 46%. Meanwhile the tax share of middle- and lower-income Americans declined.

    Van Ens buys into the liberal myth that the affluent forgot about their obligations to the less-well-off during the Reagan years.  In reality, the well-off not only paid more in taxes but also gave more in charity. The Reagan era saw the greatest outpouring of private generosity in history. Americans, who contributed around $65 billion (as measured in 1990 dollars) to charity in 1980 gave more than $100 billion annually by the end of the decade, a real increase of 54%. The average American, who gave $340 to charity in 1980, raised his or her contribution to $486 in 1990.

    Economist Richard McKenzie calculated that the rate of increase in charitable contributions was greater than at any previous time in the postwar era. Moreover, he observes, it was greater than the growth of expenditures on personal extravagances like jewelry purchases, eating out and health club memberships.

    Nor did Americans merely contribute money: More people volunteered their time for churches and civic groups than ever before.  Van Ens also fails to recognize the sacrifices made by countless American citizens who contributed their time and money to community organizations.  This uncontested fact is conveniently omitted from Van Ens’ descriptions of the 1980s as an era of greed.

    As reported in the Chronicle of Philanthropy, spending on programs such as Medicare and Medicaid, grew rapidly. As a result, and to the consternation of some conservative supporters of the Reagan administration, government payments continued to account for roughly one-third of nonprofit revenue.

    Van Ens completely misses the mark due to his grave mischaracterization of Reagan and historical misrepresentation of the facts.  His caricature of President Reagan is shameful and deserves wide condemnation.  In terms of civic virtue, it should be remembered that Reagan was one of the three great liberators in American history.  Abraham Lincoln helped emancipate African Americans from slavery; Franklin Roosevelt help wrest Western Europe from fascism’ Ronald Reagan helped liberate Eastern Europe from communism.  Regan succeeded in liberating people from tyranny which is an international act of civic virtue of the highest order.  

    He also fails to recognize the acts of civic virtue that were shown daily by our military forces which served nobly and often made the ultimate sacrifice on behalf of their fellow citizens during the 1980s.

    Deeply embedded in American liberalism is a sense that only the government can properly help the less fortunate. Liberals such as Van Ens believe that more government spending is always in order, but they fail to account for works of personal charity.  Van Ens misses the point Reagan made in his 1981 inaugural address: "How can we love our country and not love our sick countrymen, and loving them, reach out a hand when they fall, heal them when they are sick, and provide opportunities to make them self-sufficient?"

    I had the honor to serve as a military social aide at the White House during the 1980s, and I spent many hours next to President Reagan and observed his interactions with world leaders and common citizens, and I can personally attest that he was a thoroughly decent gentleman who cared deeply for his country and all its citizens.  His character was beyond reproach and it is sad to see his integrity maligned. Reagan was the embodiment of civic virtue, and he was an inspiring leader of an exceptional country composed of compassionate citizens contributing to the greater good of society.