1980's Government and Politics
The Reagan Decade.
In American politics the 1980s were the decade of Ronald Reagan, who was elected president in 1980 and succeeded by his vice president, George Bush, in 1989. Reagan's vision of the nation—and to a somewhat lesser extent his conservative agenda—shaped the economic and political fortunes of the United States for most of the 1980s.
As the decade began, Americans were struggling with an image of a country that was no longer the most powerful and prosperous nation in the world. Trust in politicians had been eroded by a series of political scandals that began in 1974 with the spectacle of an administration disgraced, as Richard Nixon resigned the presidency in the wake of Watergate, and continued into the 1980s with revelations about bribery of elected officials in the FBI Abscam sting. Social problems such as drug abuse, teen pregnancy, and violent crime were on the rise. The American economy exhibited a conjunction of high inflation, rising unemployment, and little growth. Americans were losing well-paying manufacturing jobs and taking low-paying service jobs in their place. Japan and Germany were challenging American dominance in world trade, and the United States was incurring larger and larger trade imbalances. As the major oil-producing countries raised the price of oil higher and higher, Americans were spending more and more of their incomes for gasoline and heating fuels.
The cost of human lives and international prestige incurred by a losing military effort in Vietnam had Congress shying away from Third World conflicts. Yet the Soviet Union seemed more aggressive than ever in expanding its sphere of influence. When student radicals seized the American embassy in Tehran, Iran, in late 1979 and held its staff hostage over the next fourteen months, Americans learned a frustrating lesson that was repeated again and again during the 1980s: even the finest, best-equipped military force in the world could not protect American citizens from political terrorism.
During the 1980 presidential campaign Ronald Reagan projected an optimistic, "can-do" persona and offered an appealing vision of an America restored to its former glory and prosperity through the good-old Puritan virtues of hard work, self-reliance, and faith in God. He promised to right the economy by reducing taxes, cutting government waste and bureaucracy, balancing the budget, and eliminating the deficit. He appealed to Americans' deep-seated patriotism with his vow to restore the prestige and power of the United States in foreign policy. Americans liked what they heard. Reagan defeated incumbent president Jimmy Carter, in large measure because of the votes of "Reagan Democrats," traditionally Democratic voters who bolted their party to vote for Reagan. Many of them were blue-collar workers dissatisfied with the Democrats' embrace of civil rights and so-called cultural liberalism. Setting aside their traditional suspicions that the Republicans were the party of the rich, they embraced Reagan's populist rhetoric. He promised them a new "supply-side" economic program that would ostensibly support their entrepreneurial spirit.
Democrats charged that Reagan's economic program took from the poor to enrich the wealthy and that the nation he envisioned left out minorities, the disadvantaged, and the disabled. Echoing Calvin Coolidge's pronouncement in the 1920s that the "business of the United States is business," Reagan and his supporters replied that economic incentives to the wealthy stimulated investment in American companies, creating a "trickle-down" of prosperity to the American worker through jobs and raises.
Deficits and Economic Growth.
Reagan's economic program never actually worked as planned. Tax-reform bills passed in 1981 and 1986 substantially reduced rates for personal and corporate income taxes, but the economy did not grow quickly...
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