1. The Reagan Revolution 23.2

2. Reaganomics Guides the Economy Reagan + his economic advisors turned to “supply-side economics” for their policies – Called this Reaganomics. – Theory that if taxes are reduced, ppl will have more $ to spend, causing the economy to grow. Gov’t will collect more in taxes thru spending – ∴ Reagan had to cut federal spending

3. New Policies Boost the Economy Congress passed the Economic Recovery Act in 1981 to institute supply-side economics – Reduced taxes by 25% over three years – Richest got the largest tax cut Wealthy would use this $ to invest in new businesses/ideas – $40 billion cut from the Fed’s budget mostly from social programs Deregulation: – Reduced the role of gov’t in the economy Deregulated airlines, communications and banking Also got rid of gov’t oversight agencies of industries

4. Recession and Recovery The economic recession of the 1970s carried into the early 1980s but – By 1983 the economy was beginning to turn around GNP rose, inflation fell, the economy rebounded – But lower class did not feel these benefits

5. Problems With Budget Deficits Reagan increased defense spending Failed to win budget cuts in Congress ∴ Reagan continued to work under a budget deficit = spending more than taking in – $79 billion in ‘81 to $221 billion by ’86 National debt: Amount owed to bond holders – $2.5 trillion in late 80s.

6. Effects of Reaganomics Inflation drops from 11.83% to 3.8% by 1982 16 million Jobs Added GDP grows at average rate of 3.4% Total Family wealth & income surge

7. Critiques of Reaganomics Though jobs added in total, overall average 7.5% unemployment 25% jump in poverty as Social net cut Median income drops as people forced off welfare & into lower paying jobs Budget swells (militarism)

8. CRACKED!!! The War on Drugs Crack cocaine hit America’s cities – surge in addiction, homelessness, murder, theft, robbery, and long- term imprisonment. – Reagan increases funding of the war on drugs.

9. The War on Drugs Nancy Reagan started “Just Say No” program – Random drug tests for Fed. Workers – Fed. $ cut for drug users – Treatment Facilities

10. Conservative Supreme Court Justices + Equal Access Act Reagan appointed: – Antonin Scalia, Anthony Kennedy, + Sandra Day O’Connor in 1981. – 1986: William Rehnquist was elevated to Chief Justice Equal Access Act – Allowed any group access to school facilities – Supported at the time by Conservative Christians

11. Reagan Wins Reelection in 1984 Incumbent Ronald Reagan (R) against Walter Mondale (D) - 1984

12. Social Changes for Women Increasingly involved in politics – 1981 - Sandra Day O’Connor 1st woman on Court – By 1989, 20 states have equal pay laws – Cuts for federally funded daycare

13. Social Changes for Blacks More elected to public office – Jesse Jackson ran for President in ‘84 Split in black community between educated / wealthy & poor / uneducated

14. Confronting Challenging Issues 1981- Illegally, Air Traffic controllers went on strike – Reagan fired them all after 48 hour warning & hired new workers – Supported by many Americans but seen as an assault on the labor mvm’t

15. Confronting Challenging Issues Rising Social Security costs – Nation getting older = more ppl finally tapping into SS – ∴ Reagan raised the minimum retirement age Gradual increase in the eligibility age to 67 by the year 2027 AIDS (Acquired Immunodeficiency Syndrome) – Hits the U.S. in 1981 – Is last stage of HIV (Human Immunodeficiency Virus)

16. If your textbooks are in your locker go grab them please