For the latest in my new series of conversations, I traveled to New York to spend some time
with David Stockman and, as always seems to be the case, there was simply too much fascinating
insight and too little time.
Somehow the amazing story of how David became Ronald Reagan's Director of Office of Management
and Budget didn't make it into the final edit but it was just too good a story not to share.
How do you go about making a difference, or trying to make a difference, because that's
gotta be a really hard thing for a young guy in an old man's world to try and do?
Well yeah that's right, and normally a freshman congressman would be told to sit in the back
bench, keep quiet and give a speech every three months and don't make it too long.
But there was a group of us, let's call it a renegades, led by Jack Kemp.
Who was, you know, a quite powerful guy.
Brilliant order had a lot of charisma, and so a bunch of us became kinda disciples, part
of his little group.
So Jack Kemp became you know a powerful advocate of tax reductions, smaller government free
enterprise, really you know, free trade, free enterprise, and the gold standard.
Sound money, we called it sound money because by then people had forgotten what gold was
and so that became our core ideology, sound money, low taxes, small government, unleash
free enterprise, you know, a rising tide lifts all boats, you know, we had some great speeches
Jack and I went all around the country giving these speeches but Jack was able to insinuate
himself into the Reagan campaign and get some of his close advisors involved, and Reagan
was taken with it.
And what did Reagan look like to you guys at that time?
Because, we'll get on to the parallels with today a little later on but what did that
look like?
Because that must have looked unrecognizable and yet people like Jack kind of galvanized
around Ronald Reagan, what did that feel like?
I think partly it was opportunism, now I was still an unreformed pacifist, or not quite,
but I wasn't buying the whole evil empire thing and so his foreign policy rhetoric didn't
get very far with me, But he had been a long time, you know, champion of free markets and
small government and balanced budgets and all the things that by then I had become a
vehement advocate of and so when it became clear that he was willing to adopt large chunks
of our programme, you know, we all got on board, but you know it was, it was the summer
of 1980, spring and summer of 1980.
I mean it really was that late when he kind of, again, came out of nowhere really.
Well no-one expected that he would win the primaries and one by one...
John Connally raised all the money remember and he got one vote, he raised like $70 million
and got one delegate, and then, of course, the next expectation was that George Bush
Senior, who was the establishment, Eastern establishment, a favourite if you want to
use that, would get it and Reagan beat him in a couple of primaries and you know the
rest was history.
And then everything really got re-organized around Reagan and this Jack Kemp crowd of
young Turks, which then scared the hell out of the Republican establishment on Capital
Hill.
Howard Baker who was the Senate Republican leader, Bob Michael and the house, Bob Dole,
Senator Domenici and all these guys.
And so the interesting opportunity I had in life at that point was try to become a bridge
between what I call the 'College of Cardinals', these senior Republicans who hadn't lost the
old time religion and frankly that was ok but then I mean, fiscal rectitude all that,
and the youn Turks who wanted to shake things up and Jack didn't care that much about spending.
I cared a lot about it, Jack thought that the budget would be balanced if we got enough
growth, I knew the math wouldn't work and so I was a strong believer in you know, a
balance programme of tax cutting and spending cutting.
And that's how I got into the job as the Director of OMB.
So take us behind the scenes of that as well, because that's an extraordinarily powerful
position for a young man.
The way it happened was that Reagan needed to be prepared for the Presidential debates,
and because they couldn't agree...
Remember John Anderson ran as an Independent, he was my former boss, they couldn't agree
on a format so there were seperate debates and the first one was with John Anderson,
September 1980, by then Jim Baker who was running the campaign...
Reagan to his credit adopted the whole Bush team who knew what they were doing, these
California people have no idea!
And Baker knew that John Anderson was the number one most fluent, articulate, and brilliant
debater in the house, and that he was going to make mincemeat out of Ronald Reagan if
they weren't careful.
So they took him, they took Reagan off the campaign trail for a whole week, set up a
mock studio, got a bunch of journalists like George Will and others to be the panel, microphones,
lights, the whole bit, they need someone to be John Anderson and they drafted me.
Good choice, yeah.
So I spent a week, you know, pummelling Ronald Reagan, it was great fun, I'm just imagining
it, there's this famous guy, I got to beat up on him and show him how stupid he was and
all that.
By the end of the week he was a real actor and every time they felt he was being, you
know, hit too hard they would say 'here's a better way to phrase it' and it stuck.
By the end of the week he was doing pretty well, I mean it started scary.
So then the debate came and the expectations for Ronald Reagan were exceedingly low because
Washington, official Washington and the mainstream press knew what a brilliant debater Anderson
was, and since he, they came out on kind of a tie, believe it or not, Reagan won the debate
because he far exceeded expectations.
So then, I thought, well that was an interesting little foray in life but I've got to go back
to Michigan and finish my campaign, few weeks later I get a call from Jim Baker, 'hey Stockman
get to Washington you're gonna be Jimmy Carter.'
Because Reagan it turns out was fairly superstitious and he thought since it worked out so well,
you know, the first time, so then I spent a week again in this mock studio with like
three debates a day as Jimmy Carter.
So then of course he won the election, I think there's no doubt about it, historians probably
now agree in the Cleveland debate when he famously said, and this line, he practiced
on me all week, 'there you go again Mr President!'
And that was the, I mean there's a lot more to it than that obviously but that was the
moment that that crystallized.
So after the election, he called, I think he was making his round of calls to thank
people who had played some kind of role and he said 'by the way, a lot of the fellas think
a really sharp young guy like you would really be an asset to the administration, would you
like to be in the Cabinet?'
I said, 'oh yeah.'
And he said, 'well we were thinking you know Secretary of Energy, you know you've really'
and I had been, I'd been a big advocate of natural gas deregulation and some other things,
and I said 'well, you know, I might be interested but actually what I'd love to do is be Director
of OMB.'
That's a ballsy thing for a young man offered the chance of a lifetime to say...
I was, what, 33?
And he... the better part of it was he said 'well I'm not sure what that job is.'
Because he didn't know, but I'll talk to the fellas, well it turns out the fellas didn't
know either because when he talked about the fellas that was his kitchen cabinet of all
these old geezers from LA, car dealers, and a bunch of other people who had been his core
kitchen cabinet for his entire political career.
So about 2 or 3 days later he called back and said 'you know I talked to the fellas
and I think it'd be a great idea.
You're going to be Director of OMB.'
I said 'OK when do we start?'
He said 'tomorrow.'