Before Reagan took office, the economy was much worse than what Obama faced when he entered. With unemployment soaring into double digits and yet another recession en route in 1982, Reaganomics fixed this. Poverty was increasing to over 15%, roaring double-digit inflation, and a median family income was falling 10%.
Jobs increased like never before. The implemented ideas created over 20 million new jobs for Americans.
By 1989, unemployment fell to 5.3%. This figure was down from 11.2%.
Taxes were cut significantly. The top income tax decreased from 70% to 28%.
In 1989, federal spending decreased to 21.2% of GDP. Despite the Cold War defense build up that ended the Soviet Union, federal spending was still decreased.
Price controls on oil and gas were eliminated. Production subsequently soared, and aided by a stronger dollar, prices were cut in half.
Real per-capita disposable income increased by 18% from 1982 to '89. This means the quality of life increased by almost 20% over the course of 7 years.
Economic growth averaged 7.1% per quarter for the first 7 quarters. Need I say more?
Inflation was reduced from 13.5% to 3.2% within the first 3 years. Carter's disastrous presidency allowed inflation to run out of control to that number in 1980. The tight-money policies that had to be enforced to fix this caused recessions in 1981 and 1982, which is why he isn't blamed for them.
Reaganomics kicked off the greatest economic growth ever seen. Adjusted for inflation, the 25-year economic boom was greater than the previous 200 years combined.
Under Reaganomics there was no recession. For the 92 months until taxes were raised in 1990, not a single recession occured.
Reagan tripled the national debt in eight years which reversed the trend of shrinking deficits post WWII. During Reagan's eight year presidency, the annual deficits averaged 4.0% of GDP, compared to a 2.2% average during the preceding eight years. The 1982 tax increase undid a third of the initial tax cut. In 1983 Reagan instituted a payroll tax increase on Social Security and Medicare hospital insurance. In essence Reagan imposed double taxation on social security which I have been paying in to since 1978. As a short-run strategy to reduce inflation and lower nominal interest rates, the U.S. borrowed both domestically and abroad to cover the Federal budget deficits, raising the national debt from $997 billion to $2.85 trillion. This led to the U.S. moving from the world's largest international creditor to the world's largest debtor nation. Reagan described the new debt as the "greatest disappointment" of his presidency.
The job growth (measured for non-farm payrolls) under the Reagan administration averaged 168,000 per month, versus 216,000 for Carter, 55,000 for H.W. Bush, and 239,000 for Clinton. The labor force participation rate increased by 2.6 percentage points during Reagan's eight years, compared to 3.9 percentage points during the preceding eight years. n nominal terms, median household income grew at a compound annual growth rate (CAGR) of 5.5% during the Reagan presidency, compared to 8.5% during the preceding five years. The percentage of the total population below the poverty level increased from 13.0% in 1980 to 15.2% in 1983.
Clintonomics was more successful than trickle down or Vodoo economics:
The economic policies of Bill Clinton, referred to by some as Clintonomics (a portmanteau of "Clinton" and "economics"), encapsulates the economic policies of United States President Bill Clinton that were implemented during his presidency, which lasted from January 1993 to January 2001.
President Clinton oversaw a very robust economy during his tenure. The U.S. had strong economic growth (around 4% annually) and record job creation (22.7 million). He raised taxes on higher income taxpayers early in his first term and cut defense spending and welfare, which contributed to a rise in revenue and decline in spending relative to the size of the economy. These factors helped bring the United States federal budget into surplus from the fiscal year 1998 to 2001, the only surplus years after 1969. Debt held by the public, a primary measure of the national debt, fell relative to GDP throughout his two terms, from 47.8% in 1993 to 31.4% in 2001.
Clinton signed North American Free Trade Agreement (NAFTA) into law, along with many other free trade agreements. He also enacted significant welfare reform. His deregulation of finance (both tacit and overt through the Gramm-Leach-Bliley Act) has been criticized as a contributing factor to the Great Recession.
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