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What Thom Hartmann doesn't mention is that a lot of those Federal jobs were created in the Reagan Administration in the U.S. Department of Defense and a large number in the private defense industry and most of that money for the DoD was put on the national debt card. Ronald Reagan might have been an economic conservative but he sure as hell wasn't a fiscal conservative, taking a budget deficit of roughly $40 billion in 1980 up to 200 by the time he left office in January 1989 and adding something like $4 trillion to the debt.
So President Reagan was not hiring all of these social workers or increasing the size of the U.S. Department of Education or the number of employees at the Social Security Administration, Medicare, and other social insurance agencies. He was expanding the size of the national security state, not the welfare state, because he wanted the Cold War with Russia to end, which was a great thing. But the country paid a hell of a price for that with the stock market crash of 1987 and the recession of 1990-91.