Stockman's Folly

After all these years, will David Stockman go to jail for cooking the books? His criminal indictment for investment fraud suggests he might. He is charged with faking the accounting, concealing facts and lying in the failure of a Michigan auto-parts manufacturer his investment firm owned. The historic symmetry is irresistible for anyone who remembers Stockman as Ronald Reagan's brainy young budget director twenty-five years ago. Back then, he was accused of similar sleight of hand--cooking the numbers in the federal budget and generating the monster deficits that took twenty years to correct. Nobody went to jail, but it was a big deal at the time.

I had a supporting role in that drama. I was assistant managing editor for national news at the Washington Post and produced an article in The Atlantic Monthly, "The Education of David Stockman," that revealed with shocking candor Stockman's gimmicks and deceptions--and accumulating doubts--as he struggled to fulfill Reagan's impossible campaign promise: to slash taxes, double military spending and yet also balance the budget.

Couldn't happen, and it didn't. Stockman was a true believer at first, but he gradually lost faith as he juggled the numbers, trying to conceal the exploding deficits ahead. When my article produced a political firestorm, we were both in bad odor: two "bad boys" who broke Washington's rules. But the article was true, and Stockman never tried to run away from it. It remains (I immodestly suggest) a rare and honest account of the true nature of government decision-making--chaotic, cloaked in deceit and confusion, propelled sometimes by irrational political objectives. "None of us really understands what's going on with all these numbers," the budget director famously confided to me. True then and true now. Keep it in mind whenever you read the newspapers.

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