Effects Of Reaganomics

156 Words1 Page
Second, Reagan cut taxes for corporations and the wealthy-class. The theory of Reaganomics is tax relief for the rich would enable them to spend more money, save money in banks, and make investments. The additional spending from the rich, was supposed to help stimulate the economy and create new jobs. However, the opposite occurred and America suffered a deep recession in 1981-1982. In addition, the high interest rates caused the value of the dollar to rise on the international exchange market, thus American exports decreased and imports increased. Hence, the national debt tripled from one to three trillion dollars during the Reagan Years. Although the economy eventually stabilized in 1983, Reagan and conservatives in Congress wanted a balanced
Open Document