Destroying the New Deal

The budget, under Reagan, was never balanced; in fact the deficits grew significantly. As his term of office played out, it became evident that the anti-”tax and spend” rhetoric had been followed up by an actual “borrow-and-spend” policy. Much of that borrowing was from the hated Social Security system, whose annual revenue surpluses — enhanced by a payroll tax increase enacted early in Reagan’s first term — were brought on-budget for the first time, effectively hiding the massive scope of the deficits being generated.