British commentator points out Reagan cut taxes in 1980s to help inflation

British commentator Nile Gardinier, the director of the Margaret Thatcher Center for Freedom at The Heritage Foundation in Washington, made the point in a new op-ed for the UK Telegraph that inflation did not stop former U.S. President Ronald Reagan from cutting Americans’ taxes in the 1980s, and encouraged Britain to follow his lead in dealing with that country’s inflation today.

Gardinier noted that today’s British conservative party is wrong-headed for not supporting tax cuts because they worked when former Prime Minister Margaret Thatcher and Reagan tried them nearly 40 years ago.

“As a former aide to Mrs. Thatcher, I don’t doubt that her advice today would be to cut taxes aggressively and tame price rises by reducing government spending, which is the single biggest factor fuelling inflation,” he wrote.

Britain “needs to dramatically shift away from the misguided, big-spending approach of the past two years of the Covid pandemic,” Gardinier asserted. “Post-Brexit Britain should be a shining beacon of low taxation.”

Taxpayers’ money

“Thatcher’s government never wavered from the principle that it was taxpayers’ money, not the state’s. The goal was always to bring taxes down, reduce government spending, and free up the great entrepreneurial spirit of the British people,” he continued, adding that Reagan and Thatcher’s economic policies were intertwined together.

Reagan’s “1981 Economic Recovery Tax Act advanced the most aggressive tax-cutting agenda in modern American history, with a comprehensive 25 per cent cut in personal marginal tax rates,” he went on. “This kick-started an extraordinary economic recovery following the malaise of the Carter era. Tax rates were lowered further with the Tax Reform Act of 1986.”

“The next occupant of No 10 should take a leaf out of both the Reagan and Thatcher playbooks,” he concluded, if they want to get a handle on inflation in the most effective way. 

Current Prime Minister Boris Johnson has announced that he will step down after his own coalition failed to support him in a recent confidence vote. 

Slim chances

While it is at least possible that the UK will get a conservative leader in the near future, the U.S. is stuck with a leftist until 2024, whether President Joe Biden makes it that long or not. 

There is almost no chance Biden will agree to cut taxes or that Republicans can gain enough votes to override his veto, even if they do have a very good midterm election.

It would be a very good case study on how well tax cuts work if the UK does it and the U.S. doesn’t.

Convincing the left and Democrats to change their ways will likely be impossible even in the face of facts, however.

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