Some key points of his presidency are supply-side economics, his economic policies, and the Iran Contra Affair.. Supply-side economic theory was the basis of Reagan’s economic recovery program. Using supply-side economic theory would reject the Keynesian theory that had been used during the previous years (Moss &Thomas, 2013). Instead of relying on tax cuts and government spending to boost consumer demand, the new theory would cut federal spending and taxes simultaneously. It was believed that in doing this, millions of well-paying jobs would be created and the private sector would invest more in productive enterprises.
Economists believe that government spending should rise temporarily so the drop in private spending can repair itself. The government is taking an opposite approach to the advice of economists by issuing immediate spending cuts. This fiscal policy is inappropriate for the current economic situation. With large spending cuts, the government could push the economy back into another unwanted recession. With political campaigns for the United States Presidency heating up, Americans should not be
During this time period, the Republican presidents managed to obtain a good economy and managed to improve it which would lead to more Republicans being elected in the future. The economy was an important reason for why Nixon got re-elected in 1972 as from 1971, he pursued a New Economic Policy which temporarily froze wages and devalued the dollar which was a popular policy and gained a 75% approval rating. This would have meant that the workers would have voted for the Republican’s as they would have wanted a high value for the amount of money that they earned. In 1980, Jimmy Carter was defeated and the economy would have played a big role in this loss as 63% of Americans felt that inflation was the biggest concern and Carter tried to decrease government spending but this was unpopular with Congress and Labour Unions. Because of this, there was 8.2% unemployment in 1980 which would have been unpopular with many American citizens and if the economy was better there would have been a greater chance of Carter being re-elected, but as the economy was bad many Americans
These policies include a higher protective tariff and lower taxes. When Harding arrived in the white house, the nation was in the midst of a post-wartime recession as a result of the decrease in production of wartime materials. The Harding administration successfully stimulated the economy with local public works projects and business shared work programs. This recovery evolved into the economic boom and the innovation of the early 1920s that gave the era the nickname the “Roaring twenties.” The mind behind the Warren administration’s success was in fact the secretary of the treasury, Andrew Mellon. Mellon was a multi-millionaire from Pittsburgh who had a lot of experience with economics.
These advancements are, arguably, the threshold of America’s economic success. By using appropriate economic policies, President Reagan helped to reduce both federal spending and taxes in the United States and by doing so he attracted a significant amount of investment in his country. Although he has his own school of critics, Ronald Reagan made such a great contribution in the United States that his success as a president can be compared to very few presidents in the history of the United States. His confidence in what e believed
Many republicans say that raising the minimum wage of Americans will also cause inflation to rise, sending the country back into a recession. Kruger states that when President Bill Clinton was in office and raised the minimum wage, that it actually boosted consumer spending and the economy. There is evidence that suggests that Kruger could be correct in proposing such an action. President Obama has proposed the minimum wage be raised in an effort to stabilize the economy much like Clinton did. When Clinton raised the minimum wage it stimulated a slumping economy and had increases in the job market.
These ideals are also known as supply side economics or “Reaganomics.” This is a “policy espoused by former U.S. president Ronald Reagan. He popularized the controversial idea that greater tax cuts for investors and entrepreneurs provide incentives to save and invest and produce economic benefits that trickle down into the overall economy.” (American Pie: Wealth and Income Inequality in America, 2012). With this way of thinking, the rich keep getting richer and the poor are struggling to survive. The OWS movement strives to make sure the 99%, which would be the middle to lower class Americans, also have a say in the government and a fair distribution of the finances in America. Many people believe that the trickle-down theory is just an excuse to justify favoring the rich financially and the benefits keep going to those richer people.
For example, economist Bruce Bartlett, who served as domestic policy advisor to President Ronald Reagan and treasury official under President George H.W. Bush, argues that although incomes are flat, the wealthy are not getting richer at the expense of the poor. In fact, Bartlett provides data from the Census Bureau revealing that households with an income above $75,000 rose to 28.3% from 27.9% in 2004. This type of data, according to Bartlett, demonstrates that households with higher incomes have risen and those with lower incomes have declined. Surely, Bartlett’s numbers show some improvement in our economy, however, in her article, Sklar insists that “The United States still has rising levels of poverty and inequality not found in other rich democracies”.
This will lead to increases in the fiscal deficits as the government earns less and may be spending more in forms of social protection i.e. unemployment benefits. These factors can be shown using the laffer curve, as tax rates increase tax
Reaganomics" was the most serious attempt to change the course of U.S. economic policy of any administration since the New Deal. "Only by reducing the growth of government," said Ronald Reagan, "can we increase the growth of the economy." Reagan's 1981 Program for Economic Recovery had four major policy objectives: (1) reduce the growth of government spending, (2) reduce the marginal tax rates on income from both labor and capital, (3) reduce regulation, and (4) reduce inflation by controlling the growth of the money supply. These major policy changes, in turn, were expected to increase saving and investment, increase economic growth, balance the budget, restore healthy financial markets, and reduce inflation and interest rates. Any evaluation