Reaganomics

Reagan cut taxes in 1982 and 1986, which resulted in: more tax revenues, higher GDP, inflation dropped

Reagan cut taxes in 1982 and 1986, which resulted in (a) federal revenues skyrocketing (from $517 billion in 1980 to more than $1 trillion in 1990 (+28% inflation adjusted dollars)) (b) real GDP went from 3.2% avg in Carters term, to 4.5% (avg or final) over Regan's 6 years (post tax cut). (c) inflation dropped from ≈13% to ≈5%.

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~ Aristotle Sabouni
Created: 2019-02-04

We can get more into the weeds on the total tradeoffs, but to those who aren't challenged by simple math or logic, Democrats predicted the tax cuts would be ruinous. But all the important indicators were up and they were completely wrong about ruination. The automatic increases that their social programs had baked in, did cost us a lot in deficit increases -- but the majority of that was non-discretionary and passed by Democrats, and is their cross to bear (not his). His comparatively modest defense spending increases resulted in the collapse of the Soviet Union, and a huge peace dividend.

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Laffer Curve
This is the idea that taxes have limits: the closer to 100% taxes, the more people give up (stop working).

Ronald Reagan
The greatest President of my lifetime.

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Tags: Laffer Curve Reagan