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Tag: Reagonomics

Reaganomics and NASA’s Environmental Role in the 1980s

At the beginning of 1980s the American economy was suffering through a deep recession, that, at the time, was the most significant since the Great Depression. The Iranian Revolution of 1979 and the Soviet invasion of Afghanistan had affected world oil supplies and prices. Soon gasoline shortages began to bite.  Cars waited for hours to get gasoline and riots erupted in the long queues.  In 1980 inflation reached a startling 13.5% and unemployment rose into double digits, higher than at any time in post-war era.

On November 1980, Ronald Reagan, a reform-minded conservative politician, was elected President of the United States with the promise to restore prosperity by getting “the government off the backs of the American people.” Adding his own beliefs and ideas about cutting taxes, slashing spending, and deregulating the economy to those of Paul Volcker’s, chairman of the Board of Governors of the Federal Reserve System between 1979 and 1987, Reagan set a course to revitalise the economy of the United States.

Paul Volcker, Time Magazine cover, 22 October, 1979

Soon after he took office in January 1981, President Reagan called for a massive cut in government spending, an even more drastic cut in taxation (particularly the income tax), a balanced budget by 1984, and a return to the gold standard. The last, after a report by the appointed U.S. Gold Commission, was quickly interred but Ronald Reagan delivered on each of his other policy objectives, although not to the degree that was intended. The increased military spending, mainly due to his ambitious Strategic Defence Initiative (SDI) programme, dubbed “Star Wars”, plus the tax cuts, and the Congress’ refusal to make any deep cuts to the welfare state would cost the federal government trillions of dollars. Reagan’s failure to address the savings and loan problem led to an additional debt. At the end of his presidency the national debt had been tripled. Nevertheless, his policies helped to restore confidence in the American economy.

President Reagan phones the crew of the second Space Shuttle mission from Mission Control in 1981. Photo credit: NASA https://www.nasa.gov/multimedia/imagegallery/image_feature_183_reagan.html Standing behind Reagan, left to right, are Terry J. Hart, Dr. Hans Mark,  James M. Beggs, and Dr. Christopher C. Kraft Jr. Seated next to the President is astronaut Daniel C. Brandenstein.

Reagan was a supporter of NASA’s space exploration program. Three months after he took office, on April 12, 1981, the Space Shuttle Columbia launched on its first mission and in his 1984 State of the Union Address he announced plans for a permanent human presence in space with the construction of a space station.

 “A space station will permit quantum leaps in our research in science, communications, in metals, and in lifesaving medicines which could be manufactured only in space. We want our friends to help us meet these challenges and share in their benefits. NASA will invite other countries to participate so we can strengthen peace, build prosperity, and expand freedom for all who share our goals.”

Ronald Reagan

Despite the approval of NASA’S existing programmes, the political and economic situation in the early 1980s had changed and forced the agency to rethink its program strategy, albeit with the reduced expectations and at reduced budget levels. The agency’s new administrator James Beggs had taken a keen interest in using satellites’ technology for Earth observation but his enthusiasm was not shared by NASA’s associate administrator Hans Mark. Mark, a strong supporter of the space station – NASA’s major project that period – believed that an earthly science programme could damage NASA’s priorities in space and it could provoke an escalated antagonism with other agencies, NOAA for example.

Nevertheless, Hans Mark asked the guidance of Richard Goody, a geophysics of Harvard University, with whom Mark had worked with when he was Director of the Ames Research Centre. Richard Goody recalls that Mark took him aside (in an unused Xerox room) and explained him NASA’s idea about an ambitious global climate programme, a large space mission to observe the earth system to explore the links and the interactions between the major system components of the earth, how they have evolved, function, and how they may be expected to evolve on all time scales.

Richard Goody

The idea of the Earth as one interacting system had a certain appeal for Richard Goody. He suggested that such a programme could bring a focus to NASA’s observation programme which, at the time, did not seem to have a sense of direction. It could also protect the agency from Reagan administration budget cuts. He agreed to participate in the project.

In order to identify practical objectives and examine the feasibility of the programme, NASA formed an ad hoc committee, headed by Richard Goody. The committee included fifty scientists from a wide range of scientific disciplines, such as chemistry, biology, physics and space science, among them, Wallace Broecker, Paul Crutzen, James Hansen, Lynn Margulis, and  V. Ramanathan

Announcing the committee’s meeting NASA’s director of Jet Propulsion Laboratory (JPL) Bruce Murray, (JPL had already developed an experimental earth observation satellite called SEASAT to test oceanographic sensors) said that there was growing evidence that human’s interference to the natural process of climate had reached a point that could affect every aspect of the human habitability on this planet.

 “the Earth’s climate has been undergoing large and rapid natural changes throughout the glacial ages, a geological period that still continues”.

He claimed that the atmospheric CO2 balance that governs temperature and in the long run the melting of the ice caps and the rise in sea levels was perilously close to responding to human activity. Burton Edelson, head of the Office of Space Science and Applications (OSSA) said that the “global monitoring” by satellites could offer to scientists and policy-makers the answers to climate change  and the undergoing changes that affect life on planet.

Finally, on behalf of the committee Richard Goody said that although there has been a lot of work over the past five or six years on climate, NASA’s programme “would establish a more coherent, directed approach to observe and monitor long-term changes in the atmosphere and how they affect the habitability of the globe”.

Two months after NASA’s announcement, between 21- 26 June, 1982, the newly established committee, met at Woods Hole, Massachusetts, to consider and establish the development of a coordinated program of research regarding the future habitability of the planet.


Sources and further reading:

  1. Diane N. Westcott and  Robert W, Bednarzik, Employment and unemployment: a report on 1980 https://www.bls.gov/opub/mlr/1981/02/art1full.pdf
  2. John Karaagac, Between Promise and Policy: Ronald Reagan and Conservative Reformism (Lexington Books, 2001).
  3. David Harvey, “ A brief History of Neoliberalism”, (Oxford University Press, 2005)
  4. James Tobin , “Monetary Policy”  Library of Economics and Liberty”, <http://www.econlib.org/LIBRARY/Enc/MonetaryPolicy.html>  (25/09/2007)
  5. Ten Presidents and NASA, https://www.nasa.gov/50th/50th_magazine/10presidents.html
  6. Ronald Reagan, Address Before a Joint Session of the Congress on the State of the Union, January 25, 1984, http://www.presidency.ucsb.edu/ws/?pid=40205
  7. Bruce A.. Smith, NASA considers Programme to watch Global Climate (Aviation Week and Space Technology,10 May, 1982)
  8. W.H., Lambright, Administrative Entrepreneurship and Space Technology
  9. Feature image: Massive phytoplankton bloom, in the Gulf of Alaska. Credit: NASA

Reaganomics vs. the Modern Economy by Michael Douglas Gilbert

Modern economy is different and more complex from primitive economy, says Michael Gilbert in his book “Reaganomics vs. the Modern Economy: The Conflict that divides America“.  The defining characteristic of the modern economy is the ‘impossibility of true self-sufficiency.’  Today we cannot go out and supply ourselves with food, clothing and shelter. In order to survive, we need to buy our necessities with money from a store, to interact with the marketplace. This kind of economy does not bode well for the economic theory known as ‘Reaganomics’, a term used to describe the economic policies of President Ronald Reagan that promoted tax cuts, slashing of government spending and the deregulation of domestic markets.

The prevailing view is that the high oil prices stemming from OPEC’s cartel’s oil embargoes in the 1973 has caused the stagflation that inflicted so much damage to the US and world economy. But, Fed Chairman Arthur Burns argued in his book “The Anguish of Central Banking” in 1979 that the inflation appeared to be the result of a plethora of forces:

“the loose financing of the war in Vietnam, the devaluations of the dollar in 1971 and 1973, the worldwide economic boom of 1972-73, the crop failures and resulting surge in world food prices in 1974-75, and the extraordinary increases in oil prices and the sharp deceleration of productivity.”

Whatever the forces that caused the 1970s recession, the dominant view is that it was Reagan’s policies that ended it.  Michael Gilbert does not agree with this view. The improvements in the American economy in the 1980s, he says, “has nothing to do with Reaganomics”. It was the market forces – a market correction that would take nearly ten years – that worked beautifully to end stagflation in the United States and the rest of the western world. In other words, Ronald Reagan was lucky and the misconception that somehow he turned the economy around has distorted US’s economic policy. Furthermore, it is responsible for the attack, shrink, shut down and underfund government.

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