Workers Beware! Under Trump, Reaganomics Is Back and Worse Than Ever | Alternet https://t.co/mqZghOIu81— LiberalTexasDem (@LiberalTexasDem) June 7, 2017
In the summer of 1981, Congress, including a Democratically-controlled House, passed the Reagan tax proposal, which reduced the top income tax rate from 70 percent to 50 percent. Among other measures, it included a tax break for businesses. Reagan’s economists predicted the budget deficit—the size of which, under Jimmy Carter, was a major campaign issue for Reagan—would fall to $45 billion for that coming fiscal year as the economy recovered. Fiscal 1982 ended with the deficit not at $45 billion but at $140 billion. The economy began to recover when Federal Reserve chairman Paul Volcker cut interest rates, and to a degree the tax cuts created some Keynesian stimulus. In the real world, growth could not magically rise to the heights needed. Reagan now started raising taxes, including the regressive Social Security tax, to stop the flow of red ink. It was not enough. When Reagan took office, American debt was $997 billion; when he left, it had reached $2.85 trillion. America became a net debtor nation for the first time in modern history.
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