Period 1
3/9/18
Reaganomics
When the 40th president Ronald Reagan took office America was in an extreme inflation crisis, with unemployment being at the highest since the Great Depression. Reagan introduced his economic idea known as Reaganomics, the main concept of Reaganomics was that the government would reduce the government spending on domestic programs, reduce the tax for everyday people, reduce the regulation of businesses and increase military spending to an all new high. The reason for increasing the military budget was obviously to counteract the Soviet spending of their nuclear arms. The hope of Reaganomics was that the "Trickling down" concept would save the unemployment when people in the upper class got extremely wealthy this would provide more job opportunities for the lower-class who were jobless. Near the end of Ronald Reagan's presidency, the effect of Reaganomics could be seen, unemployment dropped to a low of 6%, inflation dropped to an all new low of 4% and the taxes the government recieved rose to 909 billion.
Gavin -- Your post helped to define the popular "Reaganomics", Ronald Reagan's economic policies and how it changed the United States. Like many policies, Reaganomics is a controversial one in regards to its outcomes. Some are positive, some are negative and therefore, many view Reaganomics as having been productive for the period or leading to greater dissent. Furthermore, I wonder if Reaganomics is applicable to our real world. We look at Keynesian economics and other systems but we still debate if Reaganomics deserves a spot in our future. Many people actually compare Reaganomics with each newer president's economics response called to claim the validity and strength of Reaganomics.
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http://www.businessinsider.com/theres-a-big-difference-between-reaganomics-and-trumponomics-2017-3
Nice post, Gavin! Thanks for clarifying the concept of Reaganomics and how it came to be. Reagan wanted to use his system to create tax cuts, slow spending growth, reduce regulations, and tame inflation. While it is obvious that his reforms helped with stagflation, most historians agree that he had not delivered as much as he hoped, as the federal debt still tripled. With many conservative leaders today hoping to reimplement this system, many wonder if supply-side economics actually works. A lot of economists agree that while Reaganomics was a savior in the 1970s, it would not work today based off of the Laffer Curve. There's actually a lot of math and theory involved in it. Check out the link if you want to find out more!
ReplyDeletehttps://www.thebalance.com/reaganomics-did-it-work-would-it-today-3305569
I like this post and the discussion that's following because it is uncovering some facts behind the controversies of Reaganomics. Today, it's confusing whether it was ultimately good or bad for America. While the debt tripled and the wealth gap widened significantly, Reagan got America out of a recession with a boom. However, it ended with grief, for while the rich got richer, most Americans saw little economic improvements. By the late 1980s, middle-class incomes were barely higher than they had been a decade before — and the poverty rate had actually risen. So, while Reaganomics boosted the US for a short while, it was a one-hit wonder, and economic concepts like the Laffer Curve should be considered for longterm stability.
ReplyDeletehttp://www.nytimes.com/2008/01/21/opinion/21krugman.html