In 1982, after enacting historic tax cuts with overwhelming congressional support, President Ronald Reagan agreed to raise business and excise taxes in exchange for $280 in spending reduction over six years. Taxes went up but so did spending—by $450 billion, $140 billion of which was allocated to defense. Revenue, however, increased by only $375 billion during the remainder of Reagan’s tenure.
A couple of years later, President George H.W. Bush struck a similar deal with Democrats. In violation of a campaign pledge not to raise taxes, the senior Bush accepted a “balanced” approach that included spending cuts and tax increases to mend the deficit. Except the spending cuts never materialized and Bush lost reelection in 1992 because the voters felt they’d been cheated.