Reagan

1. Reagan 1980-1988

2. Domestic Policies • Supply side economics • Believed that tax cuts for big business and the wealthy would increase investment and hiring without increasing gov’t spending • Supported “New Federalism” • Reduced social welfare/environmental spending • Increased national debt, despite advocating a balanced budget

3. “Star Wars” • Opposed cuts to military spending • Strategic Defense Initiative (missile defense shields)

4. Farm Aid • 1980’s - world wide recession • Decreasing food prices, farmers could not pay debt • Federal land banks - farmers paid not to farm • Food prices remained low, but increased government spending

5. Immigration • 1986 - Immigration and Reform Act • Employers could not hire undocumented workers • Problems with black labor market

6. First Term Foreign Policy 1980-1984 • Strong anti-communist policies due to harsh Soviet crackdown • Central America - • El Salvador - • Nicaragua - ‘79 • Grenada ‘ 83 - surprise US invasion • Middle East - brief peacekeeping effort in Lebanon (‘83-’84) • Increasing concerns with terrorism

7. Second Term - ‘85-’88 • Goal of a balanced budget (unrealized) • Increasing wealth gap • Trade deficit increased national debt • Iran-Contra Affair • 1986 - top aides had sold weapons to Iran, Iranians then helped free US hostages in Lebanon, $ was then used to fund Contras • 1985 - return to détente • ‘87 arms reduction • ‘89 Berlin Wall torn down • Other troubles - War on Drugs (Just Say “No”), Apartheid in South Africa