Interpretations of Reagan

Solutions within federal government

Placed a hiring freeze, made departments cut travel expenses by 15%, used EO to set up advisory groups

Congress vote - 18th February 1984

Council of economic advisers had no time to follow usual budget procedure - rushed

Economic Plan - federal deficit

Cut deficit by 3% of GNP by 1986 (22% to 19%)

Economic plan - tax

Personal and business tax reductions accompanied by Economic Recovery Tax Act 1981

Economic plan - other

Deregulation and planned control of money supply

President’s Commission on housing

16th June 1982; Investigated housing to save money on federal low cost housing

ERTA and ORA

18th August 1981; Cut (marginal income) tax taking $35 billion out of federal spending

Tax Equity and Financial Responsibility Act

3rd September 1982; Tightened up tax rules for businesses

Consolidated Omnibus Budget Reconciliation Act

7th April 1986; Shifted responsibility for healthcare payments from government to employer

Inflation prevention

11.3% (1979) to 6.2% (1981) - restriction of money supply led to sharp rise in interest rates

Reduction of unemployment

Low of 100 in 1984 - rates went from 7.1% (1980) to 9.6% (1983)

Increased personal wealth

Highest tax bracket reduced from 70% to 50%

Increased productivity

GNP; 1981; 2.5, 1982; -2, 1983; 4.5, 1992; 3.5

Encouraged personal savings and investment

Policies to cut down ‘big government’ led to deregulation - increased competition led to increased risks to win savings

Stock market crash

1987; loss of $10 billion

Reduction of federal spending

Failed due to tax cuts (meant increased need to borrow abroad); $59 billion (1980), $208 billion (1983)

Federal budget

1980; HR took 28% of budget, by 1987 this was 22% - Defence budget rose from 23% to 28%

Reduction of federal ‘big government’

Federal register; 87,000 (pre-Reagan) to 65,000 - federal agencies replaced with private sector - federal workers replaced with volunteers

January 1981

Oil, fuel, wage and price deregulation

August 1988; US-Canada free trade agreement

Increased presidential power in trade trade treaties

1988 Property Market collapse

Bush had to sign FIRREA at cost of $150 billion

Effect of deregulation

No minimum wage led to insecure practices, swayed view of president given power of media, savings and loans institutions benefited those with savings

Impact of deregulation on import

1987; 3 million Americans employed by Japanese businesses - American companies lost business to cheaper foreign goods

Impact of deregulation on small businesses

Rise in conglomerates led to monopolisation

Rural impact of deregulation

Unregulated services increased cuts to maximise profits

Technology and deregulation

Destruction of primary traditional industries (300,000 lost jobs and 25 textile plants closed between 1980 and 1985) - growth in technology (Bill Gate's Microsoft)

Workfare vs Welfare

Reagan made distinction between deserving and undeserving poor stating that blaming benefits was dependency - meant family welfare payments required one working parent

Aid to Families with Dependent Children programme

Made eligible to fewer people, capping payments

Tightened up legislation providing work projects

Allowed states to make working on state projects a requirement for welfare payments - January 1987; 42 states ran work programmes

Housing crisis

1970; almost 2.4 million low-income homes available - by 1985 there were 3.7 million families who wanted homes but couldn’t access them

Spending on housing

1978; federal government spent $32.2 billion on low-cost housing projects – by 1988 this was $9.2 billion

Increased federal help for homelessness

1987; increased spending from $300 million to $1.6 billion

McKinney Act and FEMA

1987; matched state grants to local homelessness half-and-half, set up housing projects for minorities, gave medical care and childhood education to homeless

Impact on Leisure time

1973; 26 hours by 1987 it was 16 hours

Two-tier wage structure

Established workers kept wages but new workers were offered lower salaries

NAACP magazine ‘the crisis’ critique

1982; pointed out abandonment of busing programmes - hard-working, well-educated, middle-class, conformist black Americans, especially woken, filled ‘quotas’ for more cynical businesses

Impact on LGBTQ+

Ignored Aids so as not be seen as ‘gay friendly’

Bilingual education

Withdrew 40% of funding

Impact on farming

1979; USA stopped exporting wheat in protest of USSR invasion of Afghanistan - 1980; 17% of farmers were getting 60% of subsidy - 1983; 500 farms sold every month

National Save the Family Farm Coalition

1986; organised demonstrations to highlight plight of small family farms (tractorade)

Detroit

In Baltimore and Cleveland over 20% of population lived below manufacturing line

Population shift

From North and East to South and West

Suburbs

75% of all new business and 60% of new jobs were in suburbs

Religious right

Reagan’s legislation (inspired by religious right) was blocked congress; law to cut back on busing children to integrated schools and daily prayer in schools

Reagan v Bush popularity

54 republicans in senate and 189 in house vs 45-175

Public Image

Played part of ‘lost president’; trustworthy, spoke of American Dream and Family values

Election popularity

1. Approval rating was 68 compared to Carter’s 2

2. 51 vs Bush’s 6

1986; Iran-Contra Affair

White House officials had supplied arms to Iran to free several hostages using money raised to support contra rebels in Nicaragua - officials seen to destroy documents and act without congress

‘New Right’ thinking

United politicians under conservative coalition banner - but polls continually showed welfare system was being exploited and that the poor needed more help

Republican confidence

Republicans saw victory as swings of thinkings rather than reaction to Democratic failures

Division of Democrat Party

Jackson (civil rights activist) ran as candidate in 1984 and 1986 and lost both

‘New Democratic covenenant’

Clinton accepted a need for lower taxes and federal non-intervention while replacing policies that weren’t working

Businesses and government

Sponsorship in sport and influence in politics through campaign contributions; money something to be embraced

Christian right

More outspoken about abortion, teenage pregnancy and teaching

Attitude to USSR

Increased military expenditure by 13% in 1982, proposing nuclear dome (strategic defence initiative) - made Gorbachev open up USSR to political and economic reform (Pizza Hut) leading to collapse

TV viewership

1960; first presidential debate drew 70 million - only 60 million in 1970 - 80.6 million for Reagan-Carter