What was Reagonomics? Did it work? Why?

Answer 1

it didn't get the opportunity to be fully tried the congress didn't cut the necessary spending , bush Sr shifted away from Reaganomics and that's one of the reasons he failed

Answer 2

The theory of Reaganomics was that by lowering taxes, people have more money to spend, or to grow their businesses.

Example:

Reagan cut my taxes. I will now expand my business, and hire you. You now have a job, so you can go to the appliance store and buy that new dishwasher. The appliance store makes more profit, they open a new store, and hire more employees. Those employees now have jobs, and one of them buys a new car. The car company now has more money, so they hire a new employee.

And yes, it worked like a charm. It was derisively called "trickle down economics," but in a sense, that was accurate. In my example, you now had more taxpayers, making more money, and during the Reagan years tax revenues skyrocketed, while taxes were being cut.

It doesn't sound logical on the surface, but it really, really worked.

EDIT:

To the idiot below me: Unemployment was never 10.2% under Reagan, it was closer to 4.8%. At least tell believable lies when you bash a great president!

Answer 3

Trickle down economics. He believed that if the rich paid little taxes, they would spend more thus increasing the economy. To try and balance the budget he took away or altered many safety nets. The federal budget deficit ballooned under Reagan, then Bush, came down with new thinking by Clinton, then Bush bought back "trickle down economics" and the deficit shot up and again and the poor and middle class get screwed yet again.

Answer 4

Reaganomics was the belief that the economy was driven by the choices of rich people. If you cut their taxes, they will buy more vacation homes, more cars, more boats and all of the people who build and sell and service those things will have more jobs. He called it "Trickle down economics." Interestingly, George Bush (senior) who was running against Reagan, called it "Voodoo economics," although he stopped talking about this when he became Reagan's vice president. The policy did do wonders for the rich, but the "trickle down" never really happened. Studies showed that most of the additional income went into offshore bank accounts and did little for the economy.

Answer 5

He gave corporations and the rich huge tax breaks and said it was to create spending and jobs. Trickle down effect. It created a conservative paradise. The rich got richer. Unemployment was 7.4 % when he took office, rose to 10.2 before dropping back to where it was by the time he left. Never made it better in 8 years. Did it work? If you were well off when it started, probably. For the rest of us, hell no.

Answer 6

It was basically tax breaks for large corporations that were in theory supposed to trickle down to help out the general public by allowing business to prosper.

It did allow the businesses to prosper but the problem with it was that it never trickled down to help the people, it only added to the profits of the company and the salaries of the CEOs of the companies.

Furthermore to finance these tax breaks for corporations they raided social security and left it in the mess that it is now.

Answer 7

The basic description is:
Give the rich people more money. They will either spend this money on products (which helps create and sustain jobs) or invest it in their businesses (which helps create and sustain jobs). Then more people will have those jobs which are created, thereby having more money, and so on and so on.

What happened instead is that the rich people got more money, and invested it in stocks and hedge-funds and other financial vehicles which created profits for them, which they rolled over into more stocks, and so on and so on.

It worked if you were rich, you got to keep more of your money (through lower taxes) and make more money. If you were poor or middle, then you got the shaft.

Answer 8

Reaganomics is in the most simple terms this, businesses pay their employees, if you cut a business taxes it leaves more money to pay employees more OR a lower cost to sell its good for less, it works every day, its called capitalism,

Answer 9

Yes it worked. The problem was Congress just kept on spending and spending.

Its basically cut taxes and people will have more money to spend and thus the economy will grow.

Answer 10

same tax cut stuff as now...it worked for awhile but came back to haunt George H.W. (read my lips) Bush and cost him a second term when that voodoo-economics house of cards came crashing down