The Reagan administration was defined by the phrase "government is the problem" and tried to remove all government regulation of businesses. Despite this, the budget deficit of the federal government continued to grow through the decade, along with an increasing trade deficit als growing rapidly since the 1970s, and despite Reagan' promises to tackle the "twin deficits."
The budget deficit grew largely because of a combination of increased military spending and significant tax cuts given to the highest income brackets in the country. Reagan was later forced to reverse many of these tax cuts and ended up raising taxes several times. Much of the increased military spending was used to finance covert wars in Latin America and the Middle East, but also to "outspend" the Russians on defense, a process that some commentators believe helped pushed the Soviet Union into its final downward spiral into dissolution.
This passage is about the new direction of the country that Reagan felt he needed to take the
country in. His economic philosophy supply-side economics (Reaganomics) This theory
suggest that give the rich, upper income brackets, there would then be a trickle down thereby
increasing the economy. The United States government was involved trying to be the protecter
of the world. That has had a tremendous backlash, involvement in all of these covert wars. I
don't know what effect the downfall of Russia has, since there were to many unsolved problems
the needed the attention wholeheartedly by the heads of the government.
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