With regard to Donald Trump bizarrely saying, and possibly even thinking, that he coined the term “prime the pump” with regard to economic growth — ably ridiculed by Jonah Goldberg — I write just to add a fun memory of another time that phrase was used.
It was at CPAC in 1983. Two months earlier, the economy had hit an unemployment high of 10.8 percent as Federal Reserve chairman Paul Volcker (backed by some early Reagan budget cuts) had focused on taming an inflation rate that had soared above 13 percent under Jimmy Carter. Alas, part of the Volcker medicine involved letting/helping the prime interest rate rise to 21 percent. Before the Iran-Contra mess, these economic doldrums were the low point of Reagan’s presidency.
But as those such as ACU chairman Mickey Edwards already were speaking in elegiac tones about Reagan’s noble (but, implicitly, failed) attempt to prove that limited government could work in the modern world, Reagan himself, giving the keynote speech, was characteristically ebullient. He guaranteed that the economy had already turned a corner, even if lagging statistics did not yet show it.
Still, he said, he needed a little cooperation from the Federal Reserve. He said inflation was easing and that the Fed was keeping the prime rate needlessly high by artificially pumping it above the level the market demanded.
Then came his laugh line:
“I keep telling them that we can’t prime the pump by pumping the prime!”
Maybe you had to be there, to hear Reagan’s timing and to see his grin and the little, tell-tale twinkle in his eyes. For whatever reason, the audience howled with laughter, and then applauded as Reagan optimistically said he thought the Fed was starting to get the message and that the pump, the economy, would soon be very well primed indeed.
But of course this never happened way back in 1983, because Donald Trump made up the “prime the pump” analogy only two days ago. We know because The Donald told us so himself.