Ronald Reagan signed the first of two famous tax cuts on August 13, 1981. A few months later, one of his senior advisors gave an interview to the Atlantic Monthly where he revealed that the administration really didn’t care about cutting most people’s taxes. The tax cuts that affected most Americans, he explained, were “a Trojan horse to bring down the top rate” for the rich.
The Trojan horse was the giant wooden gift that the city of Troy received from the Greeks, only to find that Greek soldiers poured out of the horse once they were inside the city. In the Reagan administration’s metaphor, the “Greeks” were tax cuts for the rich, and the unwitting city of Troy was, well, the rest of us.
But it came at a price.
In the three decades preceding Reagan, the bottom 90 percent of Americans enjoyed a 75 percent increase in their inflation-adjusted incomes. In the three decades after Reagan, these same Americans enjoyed only 1 percent income growth, while the richest 1 percent saw their incomes grow by over 100 percent. Continue reading “The Greeks Are Coming! The Greeks Are Coming!”