How Did Ronald Reagan Affect The Economy

Ronald Reagan was primarily an actor before entering the world of politics and presidency. After reading this, you will have wished that he stayed in the acting industry. He was born on February 6, 1911, in Tampico, Illinois. Reagan grew up in an apartment with no plumbing and running water and moved to different towns when his father switched jobs. He graduated from Eureka College in 1932 and started as a sports announcer on the radio. Later, the Warner Bros. signed him to a contract where he starred in his first movie. From there his career took off and he became a well known actor. Reagan gained political attention with his popular televised speech for Barry Goldwater, the Republican presidential candidate at the time. Then, he won his first

He tried to use trickle-down economics which creates tax cuts for the wealthy and would allow them to spend and invest more. This spending would spark the economy and create new jobs. Reagan believed it would generate even more revenue for the federal government. Congress was not confident in this policy, but did pass cuts during his presidency. “The top marginal tax rate on individual income was reduced from 70 percent to 28 percent. The corporate income tax rate was reduced from 48 percent to 34 percent” (Niskanen). As rich saw their wages increase drastically and everyone else waited for the “trickle-down” to occur but, the result was disappointing as the growth of average wages stayed almost the same. These new jobs that were created, turned out to be low-wage work which ultimately increased the wage inequality in America. Reagan also wanted to deregulate the control on industries but, this caused the savings and loan industry to collapse because of fraud. ”In the airline industry, deregulation led to the failure of many airlines, while others were bought out by rival airlines; the ultimate outcome was less competition and higher ticket prices”(Gale Encyclopedia). This shows that the deregulation of industries allowed big businesses to merge together to dominate the industry, forcing smaller businesses to close or go

They included AFDC, mental health, child nutrition and every other category but, the nation’s defense. The AFDC was short for the Aid to Families with Dependent Children program that gave financial help to children in families with low or no income. The cuts that Reagan put into effect showed that the average family getting $609 a month from wages, AFDC and foods stamps decreased to $64 a month.The AFDC helped many single mothers take care of their children while also being able to work. These single mothers were already living in poverty and were pushed further into poverty after the cuts, forcing many to seek child support from the child’s father or sell their home and live with their parents. Children living in poverty were eligible for a free or reduced price lunch but, this changed when Reagan came into office. Have you ever wondered why our school lunches are not that great? This is partly because of Reagan’s cut on federal school lunch spending in 1981. ”In 1981, as part of an attempt to curtail government waste, the Reagan Administration slashed Federal school lunch spending by $1.5 billion”(Rude). They tried make portions smaller in school lunches and stated ketchup was a vegetable to meet the nutritional requirements. Overall, the food being given to the children of America was unhealthy and led to childhood obesity increasing rapidly. The Omnibus Budget Reconciliation Act (OBRA)