AP US History in 1 Minute Daily: Reaganomics (Day 296/309)

Hey APUSHers, let’s chat about Reaganomics as part of my series- APUSH in 1 Minute Daily!

Keynesian v. Supply Side Economics

Reaganomics sought economic growth via tax cuts, deregulation, and reduced government spending, rooted in supply-side economics, believing that lowering taxes on the wealthy and corporations would benefit all income levels through trickle-down effects.

Reagan’s plan for tax reductions, Wikimedia Commons

At its core was the Economic Recovery Tax Act of 1981, which instated broad tax reductions, particularly benefiting high-income earners and corporations, with the intent of catalyzing investment and entrepreneurial activity.

What Reaganomics Did, The Balance

Concurrently, Reagan pursued deregulation across various sectors, notably finance and telecommunications, to foster competition and innovation.

“Domestic Programs,” Etta Hulme

Reagan aimed to cut government spending, especially in social welfare, but his large military buildup led to significant increases in defense expenditure, fostering economic growth alongside growing fiscal deficits.

Reaganomics faced scrutiny for exacerbating income inequality and widening budgetary shortfalls, however, advocates assert that the policies spurred robust economic expansion.

Join me tomorrow as I explain the War on Drugs and Mass Incarceration in the next APUSH in 1 Minute Daily!