What were the results of reaganomics?

Answer 1

President Reagan was a great promoter of 'supply-side economics", a theory that held that four central policies: Lower marginal tax rates, less regulation, restrained government spending, and tightening the money supply would lead to economic growth. Lowering the tax rate was based on the idea that lower taxation would lead to increased spending and investment, which in turn would lead to increased government revenue despite the lowered rates.

Part of the problem in real life is that in politics you never end up with the pure and neat theoretic model you start out with. So although Reagonomics worked for awhile, Reagan himself had to undo many of his original tax cuts later on, because people and companies used their tax windfalls for a lot of other things too and Federal revenue based on extra activity fell short of expectations. A major effect of Reaganomics was that under Reagan the national debt tripled from less than one to almost three trillion dollars. Restraining Government spending turned out to be wishful thinking: Reagan greatly increased Government spending instead of curbing it. 'Less regulation' was low on Reagan's priority list but ultimately led to the big - and very costly - Savings and Loans scandal. Reagan considered the huge rise in Government debt 'the great disappointment of his Presidency', but he should not have been that surprised: Earlier, when Governor of California, State debt had also exploded under his rule.