Reagan Flashcards
who was Reagan
-controversial polarising figure in politics
-liberals very critical of Reagan whilst conservatives revere him as a hero
-his presidentcy was significant and influential
-had careers in 3 forms of media-radio, movies and television
who did reagan appeal to
-voters who resented high taxes, affirmative action programmes, rising crime and challenges to traditional values
Reagan major dates
1980- elected as president
1981- inaugurated as president
March 1981- survived assassination attempt
Aug 1981- major economic reform bills passed and signed into law
Jan 1982- Social security reform act signed
dec 1985- congress mandated cuts to balance the budget by 1991
Nov 1986- iran contra contraversy uncovered
feb 1987-tower commission criticises reagans management
oct 1987- Bork rejected for Supreme Court
what happened under Reaganomics
-tax cuts
-deregulation
-limited gov spending
-increased defence spending
-huge trade defecit with cheap imports and expensive exports
-collapse of industry in america and move towards financial services (movement from secondary to teritary and quaternary industries with higher income
-reagan blamed Keynesian economics for the state of the US and wanted a more conservative approach
-wanted incentives for people to work harder
-under regan the federal reserve managed to control inflation by controlling the money supply
why was reagan reelected in 1984
because of the mid decade boom due to his Reaganomics
what was supply-side economics
-argues that if taxes are cut then people would have more money to invest in the economy
-called supply side economics because the gov cared less about the demand of the public and instead focused on caring about businesses
-believes that if tax for corporations was reduced they would have more money left from their profits to invest in their businesses meaning that companies would expand and employ more people (higher wages)
-with more employmentt and higher wages people can use money to spend in the economy by buying property and products
-this would then help companies have more money
what was the criticism of supply-side economics
-corporations and shareholders tend to keep more profits than its worth, they can reinvest into their business and wider economy
-creates wealth divide between the rich and poor
-less taxes= less gov spending on welfare programs for the poorest
what was the idea of the lafer curve
-at the sweet point in this laffer curve the cutting of taxes and getting rid of regulations/bureaucracy led to companies using extra income to invest, innovate and expand
-this would lead to more money and less taxes =increased sales and profits
-neo liberals believe cutting regulations on businesses and slashing corporate taxes would make companies more competitive and therefore able to make more profits
what was regans program for ecnomic growth
presented congress with 4 different aspects:
-cut the federal deficit (to reduce domestic spending)
-reduce taxes
-deregulation
-control the money supply
-deregulation of federal and state requirements would allow businesses to flourish, their increased profit would mean more tax revenue for the government- this would pay off the deficit
-increased the cold war military spending
what did reagan want to achieve
-tax cuts to revive the economy
-wanted to cut 40 billion from the proposed budget
-deregulation=increased profits=government would get more tax
-wanted his whole economic plan to be passed through as a singular peice of legislation alongside a new tax reform bill
what was the omnibus budget reconciliation act and when was it
-1981
-reagans budget plan: white house initially wanted 45 billion worth of cuts, following negotiations managed to get 35 billion (accross 212 federal programmes)
tax cuts successes impact on America
SUCCESSES
-the ERA bill in august 1981 ushered huge tax cuts for the american people, totalling cuts of around 23% over the next 3 years
-second major peice of legislation, the 1986 tax reform act: closed loopholes and made the federal tax system a lot easier for americans
-reduced the number of different tax brackets from fourteen to just three
-also further decreased the top rate of tax from 50 to 28 percent
-exempted 6 million of poorest americas from paying any federal tax at all
what did regan reduce the number of tax brackets to and how did he decrease the top rate of tax
-reduced the number of different tax brackets from fourteen to just three
also further decreased the top rate of tax from 50 to 28 percent
ERA BILL TAX CUTS
the ERA bill in august 1981 ushered huge tax cuts for the american people, totalling cuts of around 23% over the next 3 years (35 b worth of cuts)
how many poor americans did he exempt from paying taxes
-exempted 6 million of poorest americas from paying any federal tax at all
tax cuts failures impact on america
-after a brief recession in 1981/82 reagan had to make some money for the gov…. ended in him reversing some of the tax cuts for businesses and increased taxes on ciggarettes and airline tickets
less federal government spending successes
-1981 ERA bill saw 35 billion worth of cuts across 212 government departments
-under Reagan government spending on human resources dropped from 28 percent of the federal busdget in 1980 to 22 percent by 1987
ERA BILL GOVERNMENT SPENDING CUTS
-1981 ERA bill saw 35 billion worth of cuts across 212 government departments
less federal government spending failures
-federal expidenture increased from $699.1 bn in 1980 to $859.6bn in 1987
-defence spending almost doubled from $157.5bn in 1981 to $303.6bn in 1986
-national debt tripled under Reagan to 2.6 trillion
-paying interest on this debt was the govs third highest expidenture
-congress protected popular domestic programs such as Social Security and medicare/medicaid, and funding these programmes increased in 1980s
HOW MUCH DID FEDERAL EXPIDENTURE INCREASE
-federal expidenture increased from $699.1 bn in 1980 to $859.6bn in 1987
what happened to defence spending under Reagan
-defence spending almost doubled from $157.5bn in 1981 to $303.6bn in 1986
what happened to national debt under Reagan
-national debt tripled under Reagan to 2.6 trillion
–paying interest on this debt was the govs third highest expidenture
what domestic programs were protected
-congress protected popular domestic programs such as Social Security and medicare/medicaid, and funding these programmes increased in 1980s
what were the successes of deregulation
-average of 29% cuts in government regulatory agencies, with a huge 38% from the consumer product safety commission
-reagan used his powers of appointment to ensure that cabinet members of key agencies (e.g occupational health and safety administration) would make decisions in favour of businesses rather than workers
cuts in government regulatory agencies
-average of 29% cuts in government regulatory agencies, with a huge 38% from the consumer product safety commission
what were the failures of deregulation
-deregulation in the finance sector caused companies to make more risky decisions and investments
-this led to a fairly substantial crash in 1987, although this was soon dealt with and recovery was very quick (as the gov knew how much caution damaged the economy during 1929 wall street crash)
-due to deregulation there was a collapse of savings and loans companies in the 1980s
-reagan gov had to bail them out with 132 billion
what led to the crash in 1987
deregulation in the finance sector caused companies to make more risky decisions and investments
-this led to a fairly substantial crash in 1987, although this was soon dealt with and recovery was very quick (as the gov knew how much caution damaged the economy during 1929 wall street crash)
why was there a collapse in savings and loans companies
-due to deregulation there was a collapse of savings and loans companies in the 1980s
-reagan gov had to bail them out with 132 billion
improving the economy successes
-inflation fell from 13.5% in 1980 to 4,7% in 1988
-unemployment fell from 7% in 1980 to 5.2% in 1988
-18 million new jobs created in america by 1988
-after the brief recession of 1981-1982 the USA went through its longest period of economic growth during its peacetime
-GNP rose from 3.925 trillion in 1981 to 5.866 by 1989
what happened to inflation under Reagan
inflation fell from 13.5% in 1980 to 4,7% in 1988
what happened to unemployment under Reagan and how many new jobs were created
-unemployment fell from 7% in 1980 to 5.2% in 1988
-18 million new jobs created in america by 1988
what happened after the 1981-82 recession
-after the brief recession of 1981-1982 the USA went through its longest period of economic growth during its peacetime
what happened to GNP under Reagan
-GNP rose from 3.925 trillion in 1981 to 5.866 by 1989
improving the economy failures
-trade deficit rose under reagan from 38 billion per year in 1982 to around 150 billion per year by the end of the decade
-average family income fell during reagans administration down to 1973 levels
-only half of american families maintained their standard of living during the 1980s
-number of part time and temporary work increased (wages. not as high or secure as other jobs)- reason.
What happened to family income under regan
-average family income fell during reagans administration down to 1973 levels
-only half of american families maintained their standard of living during the 1980s
