Unit 13 Lesson 2: Reagan's Domestic Policies Flashcards
(35 cards)
Reagan had two primary goals upon taking office.
The first was to stimulate the sagging economy; the second was to cut the size of the government. These moves would affect both programs and taxes.
What would happen in Reaganomics
Reagan cut income taxes for those at the top of the economic ladder. This was supposed to spur the rich to invest in businesses, factories, and the stock market. In anticipation of personal high returns, the wealthy would subsequently stimulate economic growth. According to supporters, supply-side economics would create more jobs for the less wealthy. Economic growth would also increase the total tax revenue—even at a lower tax rate.
Many politicians, including Republicans, were wary of Reagan’s economic program. Even his eventual vice president, George H. W. Bush, had spoken against it when campaigning against Reagan for the Republican presidential nomination. When Reagan proposed a 30 percent cut in taxes to be phased in over his first term in office, Congress balked. What were the opponents arguemnt
Opponents argued that the tax cuts would benefit the rich and not the poor, who needed help the most.
Reagan was successful at cutting taxes. Was he succesfull in reducing government spending?
He failed, however, to reduce government spending.
What was Reaganomics passed off of
They were based on a theory called supply-side economics, of which many economists were skeptical.
How did the number of federal employees under Reagan increase
Reagan had long warned about the dangers of big government. But he created a new cabinet-level agency, the Department of Veterans Affairs. Therefore, the number of federal employees increased during his time in office.
What did Reaganomics do about the econmy
Reaganomics also included the deregulation of industry and higher interest rates to control inflation. (These initiatives had already been tried during the Carter administration.)
How did Reagan respond to the opposition of Reaganomics
In response, the president presented his plan directly to the people. Reagan, often called “the Great Communicator,” was an articulate public speaker. His skills, honed through years as an actor and spokesperson, helped him garner support for his policies. Americans found Reagan’s rhetorical style extremely compelling. He was skillful at using a mixture of folksy wisdom, empathy, and concern while taking humorous digs at his opponents.
Reaganomics
. In other words, Reaganomics, also known as “trickle-down economics,” promised to cut taxes and balance the budget at the same time.
The president effectively conveyed his views that big government, expensive social programs, and greedy politicians had destroyed the country. He also enjoyed a surge in popularity after he survived an assassination attempt in March 1981. Public support for his economic plan swayed Congress, including many Democrats. What happened as a result
On July 29, 1981, Congress passed the Economic Recovery Tax Act. Over three years, it phased in a 25 percent overall reduction in taxes.
Reagan allotted only a small share of the federal budget to antipoverty programs. What effects did this have
Aid to Families with Dependent Children (AFDC), food stamps, rent subsidies, job training programs, and Medicaid were affected. Social Security and Medicare entitlements were left largely untouched.
Reagan had campaigned on a platform of New Federalism. What was New Federalism about.
. He wanted to decrease the reach of the federal government and return power and responsibilities to the states.
What effect would cutting federal funding to antipoverty programs have in terms of new federalism
. Cutting federal funding to antipoverty programs and leaving states responsible for the gap in funding were a collective effort in the direction of New Federalism.
. In 1983, Reagan agreed to a compromise with the Democrats in Congress.
They sponsored a bill to inject $165 billion into Social Security and increased payroll taxes to help fund the measure.
Reagan was less compromising when it came to labor unions and regulations.
Under his leadership, Congress lifted many restrictions created to stem corruption in the banking industry. The Environmental Protection Agency relaxed measures enforcing pollution control and limits on logging and drilling for oil on public lands. Reagan believed in a self-regulating free market.
His administration had little use for labor unions.
In 1981, the president fired and replaced 12,000 federal air traffic controllers. The controllers had gone on strike to secure better working conditions. Better working conditions could have benefited public safety. His intervention destroyed the Professional Air Traffic Controllers Organization (PATCO) and ushered in a new era of labor relations. Employers could defeat strikers by simply replacing them.
Reagan’s economic policy makers finally succeeded in breaking the cycle of stagflation:
highly inflated prices coupled with slow economic growth.
How did they break stagflation and cause a deep recession
To bring a halt to high inflation, the Federal Reserve raised interest rates. Borrowing became much more expensive. Consequently, consumers spent less, especially on big-ticket items. The increased interest rates triggered a deep recession.
What was the econmy like during his first uears in office
In Reagan’s first years in office, bankruptcies grew, and unemployment reached about 10 percent—its highest level since the Great Depression. Homelessness became significant in cities, although the president suggested that the press exaggerated the problem.
Did the ecnomy ever recover
However, the economy recovered in 1983, and the gross domestic product grew about 4.5 percent during the rest of Reagan’s presidency. By the end of Reagan’s second term in office, unemployment had dropped to about 5.3 percent
By the end of Reagan’s second term in office, unemployment had dropped to about 5.3 percent, but the nation was nearly $3 trillion in debt. One of the president’s campaign promises in 1980 was to balance the budget. Was he able to do this
However, an increase in defense spending along with $3.6 billion in tax relief to families with incomes of $200,000 or more made it impossible to achieve.
What were some of the biggest factors in the rising debt from 1980 to 1990?
Two of the biggest factors were increased defense spending and the tax relief for families making more than $200,000.
How do you think this rise in debt might affect the economy?
There could be cuts in spending, especially for the entitlement programs. This change would eventually require tax hikes.
In 1986, Ronald Reagan signed into law the 1986 Immigration Reform and Control Act (IRCA). What does this mean
. This was the first piece of immigration legislation in decades. The IRCA was intended to be comprehensive legislation to address unauthorized and undocumented immigration to the United States.
