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explain how Reagan’s policies reflected conservative politics and contributed to stimulation of the economy.
Fiscal stimulus during recessions to increase economic growth can be achieved through increased government spending to help those being hurt or by cutting taxes reducing revenue. Both of these produce a budget deficit that stimulate the economy. [ Liberals prefer Government programs or tax cuts for low income people to increase consumer demand, and Conservatives advocate tax cuts on corporations and high income people to increase return on investment and profits, that is supply side stimulus. The Regan tax cuts were mostly in the latter category with large cuts in the top marginal rate and
corporate taxes. However because he continued his policies after the recession ended the government deficit did not go away when the recession ended and he had large budget deficits through out his presidency which was contrary to what conservatives advocate. ]
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Expert answered|jher000|Points 6979|
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Asked 3/22/2012 1:28:00 PM
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