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Unformatted text preview: became Reaganomics. Two problems compromised the success of supply-side policies. The Reagan administration increased defense spending dramatically (something the theory did not take into account). Increased expenses combined with the tax cuts to produce a massive budget deficit. Moreover, much of the economic windfall went to buy products manufactured in foreign countries, and so provided little direct stimulus to the U.S. economy. Budget deficits grew even more, and unemployment remained (at least temporarily) high....
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This note was uploaded on 11/20/2011 for the course POSI 1310 taught by Professor Arnold during the Spring '08 term at Texas State.
- Spring '08