Reagan and Bush
- Created by: catrionabucknell_
- Created on: 23-04-16 14:17
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- HOW SUCCESSFUL WERE REAGAN + BUSH AT DEALING WITH ECONOMIC PROBLEMS
- REAGAN
- reduced taxes
- $35 billion cut in public spending
- 1981 Omnibus Reconciliation act
- gov. spending cut on 300 programmes
- reduction in spending $963bn 1981-1987
- gov. spending cut on 300 programmes
- however didn't balance the reduced cost of federal aid programmes
- federal budget went into deficit
- every budget had $100 billion + deficit
- federal budget went into deficit
- military spending
- caused the federal budget increased rapidly
- abbual defence spending rose from $171 bn to $242bn by 1986
- 1983: defence was 23.5% of GDP
- borrowing money
- money had to be borrowed to finance the federal budget
- resulted in more federal debt due to interest
- 1986: $170 billion trade defecit
- USA became world's greatest debtor nation
- balanced budget and emergency deficit control act 1985
- aimed to reduce defecit till non exsistent i 1991
- didnt work
- money had to be borrowed to finance the federal budget
- cut backs
- cut ADFC and food stamps by 13% from 1982-1985
- child nutrition programmes cut by 28%
- poor most disadvantaged due to cutbacks in federal aid
- cut ADFC and food stamps by 13% from 1982-1985
- number of poor increased form 11.7% in 1979 to 15% 1982
- raised national debt from $914 1980 to $2.7 trillion in 1989
- poor most disadvantaged due to cutbacks in federal aid
- workers
- large scale economic regulation
- office of surface mining lost 40% of work force 1981-1982
- large corporations could resist union demands
- e.g. 1983 Greyhound bus company
- increased economic growth 1981-1984
- inflation halted
- rich became richer and increased spending created comfortable middle class
- large scale economic regulation
- reduced taxes
- BUSH
- raised taxes
- went against election policy
- as the budget deficit continued to increase
- 1990: federal deficit of$ $200 billion
- 1990: rate of federal income tax raised from 28% to 31%
- new taxes for wealthy and increased taxes on luxury items e.g. cars
- went against election policy
- controlling budget deficit
- continued to rise to $300 bn
- recession developed
- military and domestic spending cuts
- $492 billion
- federal reserve board
- lowered interest rates to 3.5%
- aimed to stimulate economic growth
- no impact
- aimed to stimulate economic growth
- lowered interest rates to 3.5%
- continued to rise to $300 bn
- had a reputation as a safe pair of hands
- 'read my lips, no taxes'
- changed republican priorities
- previous liberal agenda or social welfare replaced with focus of individual enterprise
- raised taxes
- REAGAN
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