Reaganomics

After Ronald Reagan was voted into office in January of 1981, he had this vision of a new government. It was called Reaganomics. There were four points to Reagan's plan which included; reduce government spending, cut federal income tax, reduce government regulation, and to control the money supply in order to reduce spending. He also had a program he called the Reagan Revolution which was geared toward making the people of America less reliant on the government. I think Reaganomics was a good idea in theory because reducing deficits and cutting back taxes always seems like a great idea. There just always seems to be something else that goes wrong to make it all collapse.

In the book Grandin talks about President Jimmy Carter's Federal Reserve Chair, Paul Volcker. Grandin states that, "Paul didn't take his foot off the brakes until 1982 when Mexico defaulted on their international loans. " Before Reagan was elected the American economy was experiencing a decade long recession; with rising unemployment rates and a steady inflation ( stagflation ). Everyone was feeling a relieved when Reagan won the presidency campaign because somehow everyone knew that he would be different and that his policy reforms would make a change for the better. The 30 years before he was in office income for the top 1 percent of the nation had been reduced in half from 16 to 8 percent. Later on this subsided when he reduced the taxes and increased the defense budget allowing permanent budget shortfalls and draining the Great Society and New Deal programs developed by Lyndon B. Johnson and FDR.

The American economy seemed to get worse by the end of 1981 and economists throughout the country were getting more and more concerned about it. ...

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...re a lot of bad things, but in my opinion I think economists expect too much out of the US government.

In coming to conclusion, I believe that Reaganomics were a success. After his two terms in the White House, he lowered the unemployment rate to 5.4% and in 1986 further reduced the marginal tax rate from 70% to 28%. He also expressed that his worst accomplishment was that he let the national debt rise too high. Letting it go from $997 billion to $2.85 trillion; the US was known as the international creditor, now becoming the largest debtor. I think these three references have similarity because they all seem to express bad ideas that surfaced during the 1980's. Having even the slightest amount of growth, I believe Reaganomics had good intentions behind it and that Mr. Reagan did everything he could to help the US economy; even if it resulted in more debt.