TIME: Almanac 1993/TIME Almanac 1993.iso/time/052592/05259929.000

Text File | 1992-09-10 | 3.8 KB | 85 lines

                                                                                REVIEWS, Page 67

BOOKS

How I Won The War


By JOHN GREENWALD

    TITLE: The Seven Fat Years
    AUTHOR: Robert L. Bartley
    PUBLISHER: Free Press; 347 pages; $22.95

    THE BOTTOM LINE: A paean to Reaganomics that glosses over
the excesses and inequities of the Reagan era.


    If the 1980s were the worst of times for critics of that
debt-propelled decade, they were the best of times for Wall
Street Journal editor Robert Bartley. From his pulpit at the
head of the Journal's editorial page, Bartley preached the
gospel of tax cuts and deregulation that became known as
Reaganomics and hurled anathemas at heretics who argued that the
government had a positive role to play in the U.S. economy.
While Bartley's polemics sometimes clashed with facts reported
in the Journal's news columns, which were full of tales of greed
and corruption in the executive suite, they provided comfort to
many of the paper's conservative readers.

    In The Seven Fat Years, Bartley calls for a return to the
policies that, he says, made the '80s a glorious epoch. Packed
with statistics and sometimes eye-glazing arguments, the book
tells how Bartley and such fellow supply-siders as economist
Arthur Laffer and journalist Jude Wanniski cooked up the recipe
for Reaganomics over meals at a Wall Street watering hole called
Michael 1. The basic ingredients were tax cuts and a monetary
policy capable of producing low and stable interest rates. "As
1982 drew to a merciful close," Bartley writes, "both sides of
the Michael 1 prescription were finally coming into place. The
Seven Fat Years began in November."

    What those wondrous years wrought, as Bartley tells it,
was the unprecedented creation of 18 million new jobs and a
rekindling of the American spirit. The decade saw unfettered
entrepreneurs create a revolution in communication that turned
personal computers, fax machines and cable TV into home and
office staples. At the same time, venture capital boomed and new
stock and bond offerings blossomed. Bartley even applauds
changes that took place in America's eating habits. "Frozen
yogurt became a diet staple," he enthuses, "with estimated sales
increasing 300% between 1986 and 1990.

    The problem with this panegyric is all the lumpy and
inconvenient facts, such as the crumbling U.S. infrastructure
and the declining competitiveness of American corporations, that
Bartley tries to dismiss. Did the budget deficit swell
menacingly in the '80s, for example? No problem! Japan and
Germany had lots of red ink too, and "advanced" economists doubt
that deficits even matter. Did the plight of the poor worsen?
Not really, Bartley argues. The data for low-income households
overstate the extent of poverty by counting many retired people
-- who often own their own homes and have plenty of capital --
along with college students who get aid from their parents.

    Yet Bartley applies no such reductive reasoning to the
numbers that buttress his arguments. He takes the explosion of
new jobs at face value, for example, without pointing out that
many paid so little that only the growth of two-income
households kept the average family's inflation-adjusted earnings
from falling behind.

    Bartley's main error is his narrow focus on a few pet
theories and prescriptions and the inevitable special pleading
this entails. "The moral of the Seven Fat Years is that economic
growth counts," he writes. But the rising tide of '80s-style
growth failed to lift all boats as advertised: the rich got
bigger yachts, the middle class foundered, and many of the poor
went under. The task for the 1990s will be to move beyond the
excesses and inequities of the debt decade rather than strive
to return to a Golden Age that never existed.