II. Economic Troubles Objective 12.03: Identify and assess the impact of economic, technological, and environmental changes in the United States.

A. Stagflation Definition: Inflation of prices happens at the same time as high unemployment. Why is this combination a major problem? Started under Nixon in 1971, but really became a major problem for President Ford. Completely unexpected, no economist ever thought these two things could happen at the same time.

B. Ford’s Economic Approach Thought people were buying too much, causing the prices to go up. Started WIN – Whip Inflation Now Get people to wear those buttons and buy less. People didn’t want to sacrifice, so it didn’t work.

C. President Carter Election of 1976: People were bitter over Watergate and the bad economy, so they wanted someone from the other party. Jimmy Carter (Democrat) is elected. National Energy Act – oil prices sharply rose starting in 1973, hurting the economy. Carter wanted people to stop buying so much oil so prices would go down.

C. President Carter Also created the Department of Energy to help conserve energy. “Malaise speech” – asked people to buy/use less, said material things don’t make you happy. Impact: policies didn’t really work and were very unpopular.

D. President Reagan Election of 1980: A bad economy and unpopular foreign policy made people turn away from President Carter. Elected Ronald Reagan (Republican) from California. Former actor and governor of California. Wanted to “make America great again”.

D. President Reagan Economic approach: Reaganomics. Supply-side economics: Also known as “trickle-down economics”: money from spending of wealthy people goes to down less wealthy. Cuts government spending to balance out the tax cuts.

D. President Reagan Reaganomics effect: Budget deficit increased and increased the national debt. The economy did improve some. The economy got much better under Reagan, so people loved him.

Political Cartoon Analysis Answer the following questions while looking at the 3 upcoming political cartoons. Who – what things or people do you see in the picture? What – what is happening in the picture? Why – what do these different things mean or symbolize? Why did the author write this?

Independent Practice Create a chart that explains the different ways Ford, Carter and Reagan tried to fix the economy.

Exit Ticket 1) Which term is NOT associated with the theory that the economy is best stimulated by giving tax breaks to businesses and manufacturers so that they can produce more? a. Supply-side economics b. Ford’s WIN program c. “trickle down” theory d. “Reaganomics”

Exit Ticket 2) Which of the following groups has enjoyed a rise in power in the Republican Party? a. African-American groups such as the NAACP. b. Fundamentalist Christian groups such as the Moral Majority. c. Latino groups such as La Raza Unida d. Women’s groups such as the National Organization of Women.

Exit Ticket 3) Which best explains what is meant by the term “New Democrat”? a. One who supports social programs and a balanced budget. b. One who supports deficit spending and high taxes. c. One who opposes free speech and civil rights. d. One who opposes segregation and injustice.

Exit Ticket 3) Imagine President Ford and President Carter were having a debate with President Reagan on how to fix stagflation. How would each sides solutions be different?