VC (by extension, communists, and by a stretch, liberals) = Rebels. US = Empire.
Reagan in the 40s and 50s = Liberal leader (i.e., Rebel)
Reagan in the 50s = turns Republican (i.e., Empire)
Reagan in 64 = becomes a Republican/anti-communist prodigy (i.e., Empire prodigy)
Reagan later = governor/POTUS as Republican (i.e., Empire leader)
Like I said before, the VC/US thing was Lucas' analogy. This is simply Reagan's journey applying Lucas' analogy. Maybe it's a dumb idea, who cares. But it's logically consistent and a consistent application of Lucas' analogy. It's just applying a facet of the real story to the fake story.