At the start of the century on November 4, 1980 Ronald Reagan, the former republican governor of California beats president carter in a landslide victory. Many of Reagan’s economic policies affected the United States politically, socially, and economically. The collection of Reagan’s economic polies are referred as Reaganomics. Reaganomics still affects our economy, and are still a major points of debates today.
Reaganomics was not a based on the science of economics, but rather a moral foundation. Morally Reagan believed that government intervention and regulation of the economy would hinder its efficiency, and the economy needed to follow a lasses faire path. They wanted business to relay on their own without the government limiting their actions. The other part of Reaganomics are the widespread tax cuts; On May 29, 1981, tax cut legislations proposed by Ronald Reagan passed, which reduced taxes by 750 billion over …show more content…
Reagan believed that if the rich and business have more money to spend, everyone would benefit, and that the wealth would trickle down. Lee Hamilton, chairman of the congressional joint economic committee, stated in his chairman report in 1989 that, “Upper income Americans were the main direct beneficiaries of tax cuts in the early 1980s," the committee said. "There is no evidence in these data that those benefits have trickled down to lower-income Americans”. The congressional budget office report states that, “from 1980 to 1990, the top 1% had an income increase of 80%, while the other 99% had an increase of only 2.5%. And that the top 1% had a Family income increase of 74%, while the bottom 5% had a 4.4% decrease in Family Income. Average hourly wages dropped 4.5%, and 5 million jobs were lost due to factory closings.” It is no secret that Ronald Reagan’s administrations was pro-business and pro-rich, and the result was the largest income disparity since
Reaganomics was not a based on the science of economics, but rather a moral foundation. Morally Reagan believed that government intervention and regulation of the economy would hinder its efficiency, and the economy needed to follow a lasses faire path. They wanted business to relay on their own without the government limiting their actions. The other part of Reaganomics are the widespread tax cuts; On May 29, 1981, tax cut legislations proposed by Ronald Reagan passed, which reduced taxes by 750 billion over …show more content…
Reagan believed that if the rich and business have more money to spend, everyone would benefit, and that the wealth would trickle down. Lee Hamilton, chairman of the congressional joint economic committee, stated in his chairman report in 1989 that, “Upper income Americans were the main direct beneficiaries of tax cuts in the early 1980s," the committee said. "There is no evidence in these data that those benefits have trickled down to lower-income Americans”. The congressional budget office report states that, “from 1980 to 1990, the top 1% had an income increase of 80%, while the other 99% had an increase of only 2.5%. And that the top 1% had a Family income increase of 74%, while the bottom 5% had a 4.4% decrease in Family Income. Average hourly wages dropped 4.5%, and 5 million jobs were lost due to factory closings.” It is no secret that Ronald Reagan’s administrations was pro-business and pro-rich, and the result was the largest income disparity since