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Reagan (Interpretations) - Summary notes

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Summary of Interpretations - The impact of the Reagan presidency - Revision notes Edexcel AS/A Level History - Paper 1&2 Searching for rights and freedoms in the 20th Century ISBN: 978-1-4479-8533-4

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The impact of the Reagan presidency, 1981-96

Reaganism and Reaganomics – a new departure?

 Reduction of ‘big government’ that Reagan wanted to strip away interventions
made by successive liberal governments – a return to laissez-faire
 Hard line anti-union
o Union membership fell
o Union membership – ‘un-American’
 Allowed for the creation of big business corporations which could then
monopolise areas of industry
 Significant tax reductions
o Reduced top level personal rates from 70% to 25%
o Made business tax concessions
 New industries flourished
o Farming and mining suffered
 Created economies where the wealth was concentrated at the top
 Encouraged financial speculation
o Led to stock market crashes
 Believed in rugged individualism
o Created an economy where such people could flourish
 Mentally divided the poor into ‘worthy’ poor and ‘feckless’

Backlash against liberalism helped Reagan come into power.

The political scene where Reagan came to power

 1979 opinion poll – majority of Americans thought their children’s lives would
be worse than their own
 People doubted the gov. and the future as well
 Carter’s outlook was pessimistic
 Reagan – stressed what the USA had achieved before and what it could
again

Reagan’s beliefs
 Was a committed Christian
 Significant amount of support from the religious right:
o Christians who believed in traditional values
o Compulsory prayer in schools
o Opposed homosexuality and abortion
o Opposed most forms of birth control
 Reagan spoke out against abortion
 Gave jobs in the White House to members of the religious right
 Tried to pass a law restricting access to abortion
 His government was not as conservative as his supporters of the religious
right hoped

, What effect did Reagan’s economic policies have?

Immediate action
 Earlier presidents felt obliged to keep up federal involvement in social welfare
o Funded it with higher taxes and federal borrowing
 Reagan wanted to control gov. spending and cut taxes
o Influenced by ‘supply-side’ economic theories
 3 days in he sacked many White House staff
o Put a freeze on government hiring
 Told departments that there was freeze on office furnishing and equipment
o Had to cut their travel expenses by 15%
 Used executive orders to set up advisory groups
o Which reported right to him on how to cut down ‘big government;

The plan for reform
 Wanted to present his whole budget through to 1984 as a single bill when he
met with Congress on 18 February
o Wanted to present a tax bill at the same time
 His Council of Economic Advisers (CEA) had no time
 Congress had to vote on the whole package of spending cuts
o So, the administration would have approval for all measures

Reaganomics
 Cutting the federal deficit. Accompanied by a budget bill and proposal for
cuts on domestic spending. Aimed to reduce the federal deficit from 22% to
19% in 1986.
 Personal and business tax reductions. Accompanied by the Economic
Recovery Tax Act of 1981
 Deregulation. Removing federal control in industry, state and local
government
 Planned control of the money supply to keep inflation down while
expanding the economy

 Came entirely from federal grants for specific projects, set up under Johnson’s
‘Great Society’ reforms
 Included grants to state and local government bodies for slum clearance and
highway repair
 Included local initiatives in education, housing and the provision of various
services, such as the Aid to Families with Dependent Children (AFDC)
programme

Getting the legislation passed
 The White House only had to win the support of 26 Democrats in the House to
pass legislation
 The budget was now a law – Omnibus Reconciliation Act of 1981 (ORA)
 Tax legislation was harder to pass
o Senate passed it put cut the tax reduction for personal tax from 30% to
25%
o Democrats felt they were being manipulated

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