Ronald Reagan's Trickle Down Theory Essay

Ronald Reagan, the 40th president of the United States, passed a law that decreased social spending and increased military spending, along with calling for tax cuts. Reagan has thought that this was a good idea and will help improve the economic growth of the country. During his years of presidency, he created the trickle-down theory. This theory states that if you give money to the rich it will trickle-down to the poor. Helping the rich financially will help create jobs for the poor so they can work and get money. During the years of his term, the budget deficit was the largest it has ever been in US history and the poor were not better off. By 1984, the deficits settled down to $200 billion dollars.
The trickle- down theory argues income and tax breaks on big corporations will help economic growth. This will make it easier for the wealth to be easier distributed to the poor equally and everyone will benefit from this growth. More lower class people would have been able to get a job because the rich weren’t taxed as musch. However, this theory did not work. Cutting taxes for the rich means that tax on the poor will rise and they will eventually have to pay more
Even with all evidence and statistics stating that Reaganomics and the trickle down theory did not improve the economy, Donald Trump is trying to pass a similar law. He thinks that cutting tax on the rich and help the rich will help the poor. Trumps tax plan is to remove AMT and estate tax, take away the first 24,000 dollars of a couples earning, and also to cut itemized deductions. Most of these tax cuts will only benefit the very few who are wealthy. Instead of creating jobs and helping the poor, this will only make it easier for the big corporations to find a way to become an independent corporation and take advantage of the poor working class. Not only will Trump’s tax cut make it harder on the poor, but also the federal deficit by about $5 trillion over the next