How The Seventies Changed America

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It is quite clear what caused the Reagan campaign to catch on: He had begun to attack Ford from the right on foreign policy matters. The night before the primary he brought a half-hour of statewide television time to press his case. Reagan’s main substantive criticism was of the policy of détente with the Soviet Union, but his two most crowd-pleasing points were his promise, if elected, to fire Henry Kissinger as Secretary of State and his lusty denunciation of the elaborately negotiated treaty to turn nominal control of the Panama Canal over to the Panamanians. Less than a year earlier Communist forces had finally captured the South Vietnamese capital city of Saigon, as the staff of the American Embassy escaped in a wild scramble into helicopters. The oil embargo had ended, but the price of gasoline had not retreated. The United States appeared to have descended from the pinnacle of power and respect it had occupied at the close of World War II to a small, hounded position, and Reagan had hit on a symbolic way of expressing rage over that change. Most journalistic and academic opinion at the time was fairly cheerful about the course of American foreign policy—we were finally out of Vietnam, and we were getting over our silly Cold War phobia about dealing with China and the Soviet Union—but in the general public obviously the rage Reagan expressed was widely shared.

A couple of years later a conservative political cause even more out of the blue than opposition to the Panama Canal Treaty appeared: the tax revolt. Howard Jarvis, a seventy-five-year-old retired businessman who had been attacking taxation in California pretty much continuously since 1962, got onto the state ballot in 1978 an initiative, Proposition 13, that would substantially cut property taxes. Despite bad press and the strong opposition of most politicians, it passed by a two to one margin.

Preposition 13 weis to some extent another aftershock lof the OPEC embargo. Inflation causes the value of hard assets to rise. The only substantial hard asset owned by most Americans is their home. As the prices of houses soared in the mid-seventies (causing people to dig deeper to buy housing, which sent the national savings rate plummeting and made real estate prices the great conversation starter in the social life of the middle class), so did property taxes, since they are based on the values of the houses. Hence, resentment over taxation became an issue in waiting.

Carter, the only President voted into office during the 1970s, is the decade’s emblematic political figure.

The influence of Proposition 13 has been so great that it is now difficult to recall that taxes weren’t a major concern in national politics before it. Conservative opposition to government focused on its activities, not on its revenue base, and this put conservatism at a disadvantage, because most government programs are popular. Even before Proposition 13, conservative economic writers like Jude Wanniski and Arthur Laffer were inventing supply-side economics, based on the idea that reducing taxes would bring prosperity. With Proposition 13 it was proved—as it has been proved over and over since—that tax cutting was one of the rare voguish policy ideas that turn out to be huge political winners. In switching from arguing against programs to arguing against taxes, conservatism had found another key element of its ascension to power.

The tax revolt wouldn’t have worked if the middle class hadn’t been receptive to the notion that it was oppressed. This was remarkable in itself, since it had been assumed for decades that the American middle class was, in a world-historical sense, almost uniquely lucky. The emergence of a self-pitying strain in the middle class was in a sense yet another sixties spillover. At the dawn of the sixties, the idea that anybody in the United States was oppressed might have seemed absurd. Then blacks, who really were oppressed, were able to make the country see the truth about their situation. But that opened Pandora’s box. The eloquent language of group rights that the civil rights movement had invented proved to be quite adaptable, and eventually it was used by college students, feminists, Native Americans, Chicanos, urban blue-collar “white ethnics,” and, finally, suburban homeowners.

Meanwhile, the social programs started by Lyndon Johnson gave rise to another new, or long-quiescent, idea, which was that the government was wasting vast sums of money on harebrained schemes. In some ways the Great Society accomplished its goal of binding the country together, by making the federal government a nationwide provider of such favors as medical care and access to higher education; but in others it contributed to the seventies trend of each group’s looking to government to provide it with benefits and being unconcerned with the general good. Especially after the economy turned sour, the middle class began to define its interests in terms of a rollback of government programs aimed at helping other groups.