SECTION 2: The Reagan Revolution

President Ronald Reagan and Nancy Reagan after the President's election.

▲ Ronald Reagan and his wife Nancy after his victory in the 1980 election. Above, a campaign button for Reagan.

A campaign button with the words 'Let's make America great again. Reagan '80'

WITNESS HISTORY AUDIO

Reagan’s Vision

During his eight years as President, Ronald Reagan earned a reputation as the “Great Communicator” because of his speaking abilities. In his farewell speech, he expressed his satisfaction with what he had accomplished:

“After 200 years, two centuries, … [America is] still a beacon, still a magnet for all who must have freedom…. We’ve done our part. And as I walk off into the city streets, a final word to the men and women of the Reagan revolution, the men and women across America who for eight years did the work that brought America back. My friends: We did it.”

—Ronald Reagan, Farewell Address, January 11, 1989

Objectives

  • Analyze Reagan’s economic policies as President.
  • Summarize how Reagan strengthened the conservative movement.
  • Evaluate the steps taken to address various problems in the 1980s and early 1990s.

Terms and People

  • supply-side economics
  • deregulation
  • budget deficit
  • national debt
  • Savings and Loan crisis
  • voucher
  • AIDS

NoteTaking

Reading Skill: Identify Main Ideas Identify the main ideas behind Reagan’s policies.

A flow chart is entitled as "Regan Era" to identify the main ideas of Regan's policies. The chart has three sub categories named as Reaganomics, Conservative Strength, and Challenging Issues. Each box has room to fill in two bullet points.

Why It Matters Conservatives celebrated Ronald Reagan’s election as the fulfillment of their dreams. Some even referred to his coming to power as the “Reagan Revolution.” The Reagan Revolution would bring a significant shift in the political direction of the nation. Section Focus Question: What were the major characteristics of the conservative Reagan Revolution?

Reaganomics Guides the Economy

Reagan and his advisers based their economic policies on the theory of “supply-side economics,” sometimes called “Reaganomics.” The theory of supply-side economics rests on the assumption that if taxes are reduced, people will work more and have more money to spend, causing the economy to grow. The government will then collect more in taxes. To cut taxes while still balancing the federal budget, however, Reagan also needed to reduce federal spending on programs favored by both Democrats and Republicans.

New Policies to Boost the Economy

Congress approved most of Reagan’s plan to institute supply-side economics by passing the Economic Recovery Act of 1981, which reduced taxes by 25 percent over three years. The richest Americans received the largest tax cuts. Reagan justified this move by saying that the wealthy would use the money they saved to invest in new businesses, which would

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Table of Contents

Prentice Hall: United States History
CHAPTER 1 Many Cultures Meet (Prehistory–1550)
1 The American Indians 2 The Europeans 3 The West Africans 4 First Encounters American Issues Connector: Global Interdependence Quick Study Guide and Assessment
CHAPTER 2 Europeans Establish Colonies (1492–1752)
1 Spain’s Empire in the Americas 2 The French Empire 3 England’s Southern Colonies 4 The New England Colonies 5 The Middle Colonies Quick Study Guide and Assessment
CHAPTER 3 The American Colonies Take Shape (1607–1765)
1 Immigration and Slavery 2 The American Colonies and England 3 Comparing Regional Cultures 4 Wars of Empire Quick Study Guide and Assessment Reflections: Seeds of Change
CHAPTER 4 The American Revolution (1765–1783)
1 Causes of the Revolution 2 Declaring Independence Declaration of Independence 3 Turning Points of the War 4 War’s End and Lasting Effects Quick Study Guide and Assessment
CHAPTER 5 Creating the Constitution (1781–1789)
1 A Confederation of States 2 Drafting the Constitution 3 Ratifying the Constitution American Issues Connector: Expanding and Protecting Civil Rights Quick Study Guide and Assessment The Constitution and Bill of Rights
CHAPTER 6 The New Republic (1789–1816)
1 Government and Party Politics 2 The Struggle Over Foreign Policy 3 The Age of Jefferson 4 The War of 1812 Quick Study Guide and Assessment Reflections: Jefferson’s Vision
CHAPTER 7 Nationalism and Sectionalism (1812–1855)
1 Industry and Transportation 2 Sectional Differences American Issues Connector: Sectionalism and National Politics 3 An Era of Nationalism 4 Democracy and the Age of Jackson 5 Constitutional Disputes and Crises Quick Study Guide and Assessment
CHAPTER 8 Religion and Reform (1812–1860)
1 A Religious Awakening American Issues Connector: Church and State 2 A Reforming Society 3 The Antislavery Movement 4 The Women’s Movement Quick Study Guide and Assessment
CHAPTER 9 Manifest Destiny (1800–1850)
1 Migrating to the West 2 Texas and the Mexican-American War 3 Effects of Territorial Expansion Quick Study Guide and Assessment Reflections: An Age of Reform
CHAPTER 10 The Union in Crisis (1846–1861)
1 Slavery, States’ Rights, and Western Expansion American Issues Connector: Federal Power and States’ Rights 2 A Rising Tide of Protest and Violence 3 Political Realignment Deepens the Crisis 4 Lincoln, Secession, and War Quick Study Guide and Assessment
CHAPTER 11 The Civil War (1861–1865)
1 Resources, Strategies, and Early Battles 2 African Americans and the War 3 Life During the War 4 Turning Points of the War 5 The War’s End and Impact Quick Study Guide and Assessment
CHAPTER 12 The Reconstruction Era (1865–1877)
1 Rival Plans for Reconstruction American Issues Connector: Checks and Balances 2 Reconstruction in the South 3 The End of Reconstruction Quick Study Guide and Assessment Reflections: The Civil War
CHAPTER 13 The Triumph of Industry (1865–1914)
1 Technology and Industrial Growth 2 The Rise of Big Business 3 The Organized Labor Movement American Issues Connector: Technology and Society Quick Study Guide and Assessment
CHAPTER 14 Immigration and Urbanization (1865–1914)
1 The New Immigrants 2 Cities Expand and Change American Issues Connector: Migration and Urbanization Social and Cultural Trends Quick Study Guide and Assessment
CHAPTER 15 The South and West Transformed (1865–1900)
1 The New South 2 Westward Expansion and the American Indians American Issues Connector: American Indian Policy 3 Transforming the West Quick Study Guide and Assessment
CHAPTER 16 Issues of the Gilded Age (1877–1900)
1 Segregation and Social Tensions American Issues Connector: Women in American Society 2 Political and Economic Challenges 3 Farmers and Populism Quick Study Guide and Assessment Reflections: Little Bighorn
CHAPTER 17 The Progressive Era (1890–1920)
1 The Drive for Reform 2 Women Make Progress American Issues Connector: Social Problems and Reforms 3 The Struggle Against Discrimination 4 Roosevelt’s Square Deal 5 Wilson’s New Freedom Quick Study Guide and Assessment
CHAPTER 18 An Emerging World Power (1890–1917)
1 The Roots of Imperialism American Issues Connector: Territorial Expansion of the United States 2 The Spanish-American War 3 The United States and East Asia 4 The United States and Latin America Quick Study Guide and Assessment
CHAPTER 19 World War I and Beyond (1914–1920)
1 From Neutrality to War American Issues Connector: America Goes to War 2 The Home Front 3 Wilson, War, and Peace 4 Effects of the War Quick Study Guide and Assessment Reflections: The Progressive Era
CHAPTER 20 The Twenties (1919–1929)
1 A Booming Economy 2 The Business of Government 3 Social and Cultural Tensions American Issues Connector: U.S. Immigration Policy 4 A New Mass Culture 5 The Harlem Renaissance Quick Study Guide and Assessment
CHAPTER 21 The Great Depression (1928–1932)
1 Causes of the Depression 2 Americans Face Hard Times 3 Hoover’s Response Fails Quick Study Guide and Assessment
CHAPTER 22 The New Deal (1932–1941)
1 FDR Offers Relief and Recovery 2 The Second New Deal 3 Effects of the New Deal American Issues Connector: Government’s Role in the Economy 4 Culture of the 1930s Quick Study Guide and Assessment Reflections: Art in the New Deal
CHAPTER 23 The Coming of War (1931–1942)
1 Dictators and Wars 2 From Isolation to Involvement 3 America Enters the War Quick Study Guide and Assessment
CHAPTER 24 World War II (1941–1945)
1 The Allies Turn the Tide 2 The Home Front 3 Victory in Europe and the Pacific 4 The Holocaust 5 Effects of the War Quick Study Guide and Assessment
CHAPTER 25 The Cold War (1945–1960)
1 The Cold War Begins 2 The Korean War 3 The Cold War Expands 4 The Cold War at Home American Issues Connector: Civil Liberties and National Security Quick Study Guide and Assessment
CHAPTER 26 Postwar Confidence and Anxiety (1945–1960)
1 An Economic Boom 2 A Society on the Move 3 Mass Culture and Family Life 4 Dissent and Discontent Quick Study Guide and Assessment Reflections: Postwar Changes
CHAPTER 27 The Civil Rights Movement (1945–1975)
1 Early Demands for Equality 2 The Movement Gains Ground 3 New Successes and Challenges American Issues Connector: Voting Rights Quick Study Guide and Assessment
CHAPTER 28 The Kennedy and Johnson Years (1960–1968)
1 Kennedy and the Cold War 2 Kennedy’s New Frontier 3 Johnson’s Great Society American Issues Connector: Poverty and Prosperity Quick Study Guide and Assessment
CHAPTER 29 The Vietnam War Era (1954–1975)
1 Origins of the Vietnam War 2 U.S. Involvement Grows 3 The War Divides America 4 The War’s End and Impact American Issues Connector: America and the World 5 Nixon and the Cold War Quick Study Guide and Assessment
CHAPTER 30 An Era of Protest and Change (1960–1980)
1 The Counterculture 2 The Women’s Rights Movement 3 The Rights Revolution Expands 4 The Environmental Movement American Issues Connector: Interaction With the Environment Quick Study Guide and Assessment
CHAPTER 31 A Crisis in Confidence (1968–1980)
1 Nixon and the Watergate Scandal 2 The Ford and Carter Years 3 Foreign Policy Troubles Quick Study Guide and Assessment Reflections: The Civil Rights Struggle
CHAPTER 32 The Conservative Resurgence (1980–1993)
1 The Conservative Movement Grows 2 The Reagan Revolution 3 The End of the Cold War 4 Foreign Policy After the Cold War Quick Study Guide and Assessment
CHAPTER 33 Into a New Century (1992–Today)
1 The Computer and Technology Revolutions 2 The Clinton Presidency 3 Global Politics and Economics 4 The George W. Bush Presidency 5 Americans Look to the Future American Issues Connector: Education and American Society Quick Study Guide and Assessment
Reflections: Enduring Issues Five Themes of Geography Profile of the Fifty States Atlas Presidents of the United States Economics Handbook Landmark Decisions of the Supreme Court Documents of Our Nation English and Spanish Glossary Index Acknowledgments
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