Reaganomics

  

Categories: Regulations, Econ

See: Bonzo.

Reaganomics: the conservative economics policy implemented by Reagan.

Reaganomics wasn’t out of the blue. It was done to combat the 1980 recession and the most dreaded thing of all: stagflation. Stagflation is when the recession is still continuing, along with inflation (rising prices), which is counterintuitive to what many economic theories say will happen (usually, we see inflation with economic expansion, not contraction).

Reaganomics, in short, was a supply-side economic policy, or trickle-down, i.e. making things easier on the higher-ups (wealthy people) and firms (run by the wealthy people) in an attempt to boost the economy. The thought was that, by cutting business regulations, income taxes, and capital gains taxes, wealthy people will spend (and invest) more. Spending, in theory, is what gets the economy back on track, into expansionary mode.

If wealthy people were spending and investing their dollars, instead of just letting it sit there, the idea was that it would create more jobs and more spending by the masses, which would lead to more economic growth. Money would “trickle down” from high-income earners to low-income earners.

Besides cutting business regulations, income taxes, and capital gains taxes, Reaganomics also cut the growth government spending and the expansion of the money supply. This is notable, since the mainstream macroeconomics running our government today, Keynesian economics, would want to do the opposite: increase government spending and the money supply. These two things would give the people more money to spend, in theory.

So...the million-dollar question: did it work? Well, that’s up for debate. Supporters point out waning stagflation and GDP growth. Critics point out the widening income gap, saying money trickled up, not down...as well as the national debt, which tripled in a mere eight years.

Related or Semi-related Video

Econ: What is Maslow's Hierarchy of Want...3 Views

00:00

and finance Allah shmoop What is Maslow's hierarchy of wants

00:06

and needs Perhaps no other psychological theory has affected the

00:12

public mind as muchas Maslow's hierarchy of wants and needs

00:16

Seriously though Abraham Maslow came up with this theory in

00:19

the nineteen forties away to organize ideas about how humans

00:23

are motivated in the field of developmental psychology with what

00:26

makes them tick What makes them want Maazel's hierarchy of

00:29

wants and needs been used in psychology sociology and management

00:33

providing kind of a framework for this old people taking

00:36

things Usually Maslow's hierarchy of needs is shown in a

00:41

pyramid shaped image with the basic needs of the bottom

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and higher level Motivating factors up here at the top

00:47

of the pyramid shape isn't like ours Food pyramid reflecting

00:51

the amounts of things we need you know to survive

00:53

Instead think of Maslow's hierarchy of needs as a pyramid

00:57

that's meant to be climbed Maslow's original theory was that

01:01

a person must be satisfied with the factors at one

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level within themselves before they could be motivated by factors

01:08

at the next level Well Mohr modern interpretations show the

01:11

five levels as overlapping their blurred implying that lower levels

01:15

might be prioritized again down the road even if someone

01:18

is you know higher up on the pyramid in general

01:21

we're going to talk about Bob's journey here through Maslow's

01:23

theories Bob could be you your mom your friend or

01:25

that stranger you just passed on the street Yeah deep

01:28

inside everyone is Bob the base of the pyramid We've

01:31

got physiological needs which includes things like food water rest

01:35

shelter and the ability to you know live in the

01:38

environment in general Well here The idea is that it's

01:41

hard to motivate Bob with something like prestige when he's

01:45

too busy trying to meet basic physiological needs so that

01:48

he can you know just stay alive Bob's got bigger

01:51

things to worry about right now If he's homeless food

01:54

lists and you know pantless alright well once Bob's got

01:57

the basics of staying alive down he can move up

01:59

to the safety motivation level up here which says that

02:03

Bob can then be motivated by things that give him

02:05

security like think physical safety financial security health You know

02:10

those things make sense that once Bob's got his food

02:13

water in things that he needs to live seek out

02:16

security so that he can keep those things under lock

02:18

and key and you know keep on keeping on basic

02:21

mortality avoidance At this point Bob's Fed rested and not

02:25

stressing out so much because survival instincts took a chill

02:28

pill thanks to his safety measures Good job you know

02:31

a place to live maybe wearing a bike helmet Occasionally

02:34

you go bob pants Don't forget the pain's bob Finally

02:38

Hopkins start looking outward into the world The third level

02:41

of hierarchy here It's love and belonging right The human

02:45

needs for closeness with one another In other words nothing

02:49

will motivate Bob more at this point than making friends

02:52

taking the singles bar by storm pay Well Bob made

02:55

friends at work and managed to snag a girlfriend Honestly

02:59

Nice Bob Bob's now capable of being motivated by things

03:02

that level for his self esteem Bob will be motivated

03:07

by things that give him confidence in a sense of

03:09

accomplishment Well for Bob maybe a nice car makes him

03:13

feel confident Or maybe Bob doesn't care for a nice

03:16

car but he's really into his career working his way

03:19

up the quote prestigious unquote corporate ladder Whatever Bob's values

03:23

are well he can be motivated by things that can

03:25

fulfill them making him feel Fly fly Bob Fly right

03:30

Well now that Bob's taking care of his basic needs

03:32

in his physiological needs well he has time to fight

03:35

focus on himself again But in a you know higher

03:38

way Well at the top of the Pyramid the big

03:41

boss of the video game that is Bob's Life Well

03:44

we've got self actualization right there Self actualization is when

03:48

Bob feels his utmost potential If Bob's motivated at this

03:52

level while that means Bob wants to be the best

03:55

Bob he can be well for Bob This might have

03:57

to do with fulfilling creative passions using his talent finding

04:03

a you know life partner and raising Tiny Bob Yeah

04:06

that'LL do it After publishing his theory Mass Low later

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criticized his own initial description of self actualization And while

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he changed it to be more like becoming enlightened or

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something like that would mean that Bob things about meaning

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of life things about spirituality morality the universe and seize

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prejudice for what it is a fear based ego boosting

04:27

mean girl thing Bob becomes a true wiseguy Astle's hierarchy

04:31

of wants and needs does have its fair share of

04:33

critics It's not accepted by everyone Some believe that people

04:38

can be motivated by needs and wants higher up on

04:39

the pyramid even if they haven't satisfied all the ones

04:42

on the bottom first Others have pointed out mass low

04:45

on ly studied healthy specimens not the population at large

04:49

So there could be some bias there some bargain The

04:52

Massa lt's hierarchy only works for people in individualistic societies

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and not so much for people in collectivist societies Help

04:58

priorities and values are different Plus these needs might also

05:02

be a different depending on Bob's age Right The final

05:05

kicker maybe Massa lt's pyramid isn't really human Needs can

05:09

be applied to most animals in general Massell insisted that

05:12

this motivation theory needed to be people center cannot animal

05:16

centric He was a man of his time Today we

05:18

know more than ever before about how the other species

05:21

live and communicate The more we learn the more mass

05:23

ALS hierarchy of wants and needs seems to apply to

05:26

them just as much as it does for us especially

05:28

for the first four five levels So could mass low

05:32

have come up with a better theory Well yeah Maybe

05:35

he could have if he'd been more motivated The sweet 00:05:40.087 --> [endTime] sweet irony Oh no

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