1. Conservative Policies under Reagan and Bush
Chapter 25, Section 2 Notes

2. Objectives Summarize Reagan’s economic programs.
Describe the changes that occurred in the makeup and decisions of the Supreme Court
Identify results of deregulation
Analyze the presidential elections of 1984 and 1988

3. Main Idea and Terms/Names
Reaganomics
Supply-side economics
SDI
Sandra Day O’Connor
Deregulation
EPA
Geraldine Ferrara
George Bush
Presidents Reagan and Bush pursued a conservative agenda that included tax cuts, budget cuts, and increased defense spending

4. Reaganomics Reagan won election of 1980
New Economic Plan – Reaganomics
Budget cuts
Tax cuts
Increased defense spending
Wanted to reduce size and influence of federal government
Encourage private investment

5. Budget Cuts Downsize federal govt through cutting out social programs
Save money
Did not effect middle class entitlement programs
Congress slashed budget of food stamps, mass transit, welfare, student loans

6. Tax Cuts Supply-side economics US Govt lowered income taxes by 25%
If people pay less in taxes, they will save money (in theory)
Banks could loan that money to businesses
Businesses are the base of prosperity
US Govt lowered income taxes by 25%
“Trickle Down” Theory – more rebates to rich - $ would trickle down

7. Increased Defense Spending
Reagan doubled the defense budget
Strategic Defense Initiative (SDI)
Defense system to protect Americans from enemy missiles
Known as “Star Wars”
System would cost trillions of dollars

8. Recession and Recovery
Economy had sunk into recession
Worst since Great Depression
1983 – Economic upturn leads to recovery

9. National Debt Climbs Economy still had problems
Tax cuts helped the rich
Social welfare cuts hurt the poor
Federal spending was larger than income – deficit
National debt doubled during Reagan’s first term

10. Supreme Court Reagan nominated conservatives to Supreme Court
Sandra Day O’Connor
Antonin Scalia
Anthony Kennedy
Bush continued the trend
David Souter
Clarence Thomas
Scalia
Kennedy
O’Connor
Thomas
Souter

11. Supreme Court Conservative William Rehnquist was Chief Justice
Ended liberal control of the court
Restricted abortion
Restricted civil rights
Narrowed rights of accused

12. DeRegulation
Deregulation – cutting back of federal regulations of industry
Reagan removed price controls on oil
Eliminated federal health and safety inspectors for nursing homes
Deregulated savings and loan industry
Increased competition and lowered prices for consumers

13. DeRegulation Reagan cut the EPA’s budget
Government sold public land to private developers
Opened continental shelf to drilling
Risks?
Cut timber in national forests

14. Election of 1984 Reagan had a conservative coalition
Business – liked deregulation
Southerners – liked small fed. govt
Westerners – liked less environ. restrictions
Reagan Democrats – Dem. too liberal
1984 – Reagan/Bush v. Walter Mondale/Geraldine Ferraro
Reagan won by a landslide

15. Election of 1988
George Bush (Reagan’s VP) v. Michael Dukakis (Gov. of Mass.)
Economy was strong –no reason for change
Bush was part of moral majority
Bush – “no new taxes”
Bush ran negative ads – low voter turnout
Bush wins…53% of vote