Reagan vs. Carter on Spending

by Ramesh Ponnuru

Senator Rand Paul has from time to time claimed that Reagan was worse on spending, from a limited-government perspective, than Carter. At Reason today, Nick Gillespie backs him up with an article titled: “Rand Paul is Right: Carter Was Thriftier Than Reagan.” The subhed says it’s very important for Republicans to understand this fact.

I wouldn’t make too much of Paul’s comment, and I think Gillespie makes some good points along the way. But I don’t think his central fact is a fact. Gillespie writes: “Paul is also correct to say that Reagan was worse than Carter when it came to spending. . . . Carter increased real spending 17 percent over the last budget of his predecessor, Gerald Ford. Over two terms, Reagan increased spending by 22 percent over Carter’s final budget.”

But that means that on average, spending increased 4 percent per year under Carter and 2.5 percent per year under Reagan. That’s a pretty sizable difference: If Carter had merely kept spending at the same rate in a second term, his total would have been 37 percent. Reagan looks worse only if you hold getting re-elected against him.

UPDATE: Gillespie has edited the post. His new numbers are slightly off. (He’s getting the annualized rates of increase by dividing the total increase by the number of years, which ignores compounding; you have to take roots.) But he concedes that on an annual basis, Carter increased spending faster than Reagan. Gillespie does not, however, agree with me that this fact is fatal to the Gillespie/Paul claim that Carter was the thriftier of the two.

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