Conservative Policies under Reagan and Bush

Chapter 25, Section 2 Notes

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

Main Idea and Terms/Names

•Presidents Reagan and Bush pursued a conservative agenda that included tax cuts, budget cuts, and increased defense spending

•Reaganomics•Supply-side economics•SDI•Sandra Day O’Connor•Deregulation•EPA•Geraldine Ferrara•George Bush

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

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

Tax Cuts•Supply-side economics

– 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

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

Recession and Recovery

•Economy had sunk into recession– Worst since Great Depression

•1983 – Economic upturn leads to recovery

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

Supreme Court

•Reagan nominated conservatives to Supreme Court– Sandra Day O’Connor– Antonin Scalia– Anthony Kennedy

•Bush continued the trend– David Souter– Clarence Thomas

ScaliaKennedy

O’Connor

Souter

Thomas

Supreme Court

•Conservative William Rehnquist was Chief Justice

•Ended liberal control of the court– Restricted abortion– Restricted civil rights– Narrowed rights of accused

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

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

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

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