Chapter 19 Section 2 The Reagan Revolution

Great Communicator

Reagan's reputation

"Reagan Revolution"

Reagan's coming to power

supply-side economics (Reaganomics)

The theory rests on the assumption that if taxes are reduced, people will work more and have more money to spend, causing the economy to grow

Economic Recovery Act, 1981

Reduced taxes by 25% over three years.

deregulation

The removal of government control over industry

Gross National Product

Annual income earned by Americans and American business

working poor

people who work but whose earnings are not enough to lift them above the poverty line

budget deficit

Shortfall between the amount of money spent and the amount taken by the government

national debt

The amount of money the federal government owners to owners of government bonds

Gramm-Rudman-Hollings Bill, 1985

Sought to balance the budget by 1990 by requiring automatic cuts in federal spending if the deficit exceeded a certain amount

Savings and Loan crisis (S & L)

One of the largest financial scandals in U.S. history, the Savings and Loan Crisis emerged in the late 1970s and came to a head in the 1980s, finally ending in the early 1990s. In the volatile interest rate climate of the '70s, large numbers of depositors removed their funds from savings and loan institutions (S&Ls) and put them in money market funds, where they could get higher interest rates since money market funds weren't governed by Regulation Q, which capped the amount of interest S&Ls could pay to depositors. S&Ls, which were largely making their money from low-interest mortgages, did not have the means to offer higher interest rates, though they tried to once interest rate ceilings were dropped in the early '80s. As S&L regulations loosened, they engaged in increasingly risky activities, including commercial real estate lending and investments in junk bonds.Also known as "thrifts". I: Because S&L deposits were insured by the Federal Savings and Loan Insurance Corporation (FSLIC), depositors continued to put money into these risky institutions. A complex web of these factors and others, combined with widespread corruption, led to the insolvency of the FSLIC, the government bailout of the thrifts to the tune of $124 billion in taxpayer dollars and the liquidation of 747 insolvent S&Ls by the U.S. government's Resolution Trust Corporation. One of the largest S&L failures was that of Lincoln Savings & Loan, part of the Keating Five scandal which exposed the political corruption that was part of the S&L Crisis.

"It's morning in America"

Raegan's presidential campaign phrase

John Hinckley Jr.

Tried to assassinate Reagan

Walter Mondale

Democratic presidential nominee in 1984

Geraldine Ferraro

First woman to be nominated for Vice President in a major political party

momentum

Forward motion; push

Sandra Day O'Connor

The first female justice and a modern conservative

Antonin Scalia

One of Raegan's Supreme Court nominees

Anthony Kennedy

One of Raegan's Supreme Court nominees

William Rehnquist

Reagan boosted him to become Chief Justice

Equal Access Act

Act required public secondary schools to allow any group equal access to school facilities.

Education of Westside Community School v. Mergens

Confirmed the constitutionality of the Equal Access Act in 1990

George H. W. Bush

Reagan's VP for eight years

Michael Dukakis

The democratic candidate, Massachusetts governor

Americans with Disabilities Act (ADA)

Ensures that Americans with disabilities will receive the same opportunities in employment and access to public transportation and public places as other Americans

Yuppie

Young urban professional. under 30, live in the city, and work in an office

Challenger

Space shuttle that exploded 73 seconds after launch

Professional Air Traffic Controllers Organization (PATCO)

This union represented air traffic controllers who, as government employees, were denied the right to strike. When they engaged in an illegal strike in 1981, Ronald Reagan broke the strike and the union, despite the fact that he himself had once been the president of a union (the Screen Actors Guild). The result was a general weakening of labor unions in the U.S.

Social Security Reform Act

Raised the minimum retirement age and increased payroll taxes for social security. Provided a temporary fix

A Nation at Risk

A study that showed that students were consistently scoring lower in standardized tests as time passed

acquired immunodeficiency syndrome (AIDS)

group of clinical signs and symptoms associated with suppression of the immune system and marked by opportunistic infections, secondary neoplasms, and neurologic problems

human immunodeficiency virus (HIV)

Attacks the immune system of its victims

Compare supply-side and Keynesian economics.

Supply side = The theory rests on the assumption that if taxes are reduced, people will work more and have more money to spend, causing the economy to grow

Keynesian = economic theory of total spending in the economy and its effects on output and inflation.

How did the recession hurt blue-collar workers?

Many farmers, facing overseas competition, lost their farms

What was Bush's' agenda?

Not to raise taxes, defend traditional values, control federal government spending, get more Americans to volunteer

Tear Down This Wall—what would this symbolize?

Reagan's stance to the Russian leader to tear down the Berlin Wall and unite the city to what it used to be