You know the rest of the story. The deficit, which stood at $74 billion in Carter's final year, ballooned to $155 billion in Reagan's final year. In the words of Vice President Dick Cheney, "Reagan taught us deficits don't matter."
Today, what does it mean to be a Republican? It means you can cut taxes indiscriminately and needn't worry about the debt you're piling up. It certainly doesn't mean that you want to shrink the federal government. Indeed, government spending under George W. Bush has increased faster than it did under Bill Clinton. Before Reagan, pandering was principally a Democratic vice. Today, it's principally a Republican vice. Ronald Reagan performed that transformation, and it remains his most enduring legacy.