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REAGANOMICS

REAGANOMICS. "Individual freedom and the profit motive were the engines of progress which transformed an American wilderness into an economic dynamo that provided the American people with a standard of living that is still the envy of the world." .

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REAGANOMICS

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  1. REAGANOMICS

  2. "Individual freedom and the profit motive were the engines of progress which transformed an American wilderness into an economic dynamo that provided the American people with a standard of living that is still the envy of the world."

  3.  “Recession is when your neighbor loses his job. Depression is when you lose yours. Recovery is when Jimmy Carter loses his.”

  4. Restore Laissez-Faire • Deregulation • Tax Cuts • Reduce Federal Spending Military Build-up as Economic Stimulus

  5. PATCO Walks Out, 1981

  6. http://www.youtube.com/watch?v=e5JSToyiyr8

  7. Environmental Regulations Adjusted

  8. Banking Deregulation Distinctions between savings banks and commercial banks blur in terms of who gets credit, how much, in what form and for how long. Impacts commercial lending, credit cards, checking accounts, etc.

  9. Deregulation of the Stock Market: Hostile takeovers, junk bond trading, leveraged buy-outs, etc.

  10. TAX CUTS The Holy Grail

  11. Supply-side Economics David Stockman Trickle-down “Voodoo Economics”

  12. Supply Side Economics: Taxes   Savings  Investment   Jobs   Income   Tax Revenues 

  13. U.S. Department of Labor

  14. How to Reduce Federal Spending: Dismantle the Welfare State! • Cuts to Social Welfare Programs • Unfunded entitlements

  15. “Welfare queens picking up checks in their Cadillacs.”

  16. “I’m trying to undo the Great Society. It’s the war on poverty that led to this.”

  17. • Reduced Federal Spending • Under-Funded Entitlements (e.g., Medicare, Social Security, etc.) • Unfunded Mandates (e.g., education, welfare, ESL, Psych treatment) • Degraded Infrastructure (e.g., airports, highways, parks, etc.) • Cuts in R&D (e.g., science, humanities, etc.)

  18. Starve the Beast Theory (Moynihan Theory) Step 1: Cut taxes Step 2: Now there is no money for services Step 3: Underfunded government functions poorly Step 4: “Government isn’t the solution; government is the Problem.” Step 5: Cut taxes further….. Step 6: Confidence in government plummets

  19. Reduced Federal Allocations to the States • Unfunded mandates • Burden shifts to states on • Education • Infrastructure • Social Welfare   Regressive state taxes (e.g., sales, property, licensing, etc.) favor the rich

  20. Poverty Rate 1978 = 11% Poverty Rate 1985 = 14%

  21. U.S. Department of Labor

  22. Defense Spending Grows From 5% to 8% of GDP

  23. Defense Expenditures as % of GDP

  24. Impact • Economic Miracle? • More efficient economy • 8-year economic expansion • Based on defense spending

  25. Uneven Expansion • New breed of billionaire

  26. Decline of the Middle Class • Union Busting • wages • benefits • security • Loss of Manufacturing Jobs • Declining Standard of Living

  27. Poor Bear the Burden of Loss of Services

  28. The Age of Greed http://www.youtube.com/watch?v=Muz1OcEzJOs

  29. If you’ve got it, flaunt it.

  30. • Protestant Ethic? • Mid-century sense of mutual responsibility? • Hippie anti-materialism?

  31. U.S. Department of Labor

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