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Difficulty: HardReaganomics and Domestic Policy under Reagan and Bush

���The Reagan administration’s policies did not dismantle the welfare state, but they did successfully reshape the terms of the political debate. For a generation after the New Deal, politicians of both parties accepted the expansion of federal responsibilities for social welfare and economic regulation. After 1981, the dominant political question was no longer how the federal government could solve a problem, but whether the federal government was the problem itself.”

— William C. Berman, historian, *America’s Right Turn: From Nixon to Clinton*, 1994

Which of the following actions by the Reagan administration most directly reflected the shift in the political debate described in the excerpt?

  1. A
    Increasing federal domestic spending on social welfare programs to stimulate consumer demand
  2. Promoting supply-side economic policies that emphasized tax cuts and deregulation as the primary drivers of growthAnswer
  3. C
    Expanding federal regulatory oversight of key industries to stabilize market competition and protect consumers
  4. D
    Prioritizing immediate reductions in military spending over tax cuts to secure balanced budgets

Answer

Promoting supply-side economic policies that emphasized tax cuts and deregulation as the primary drivers of growth
The correct answer is correct because it identifies the core components of Reaganomics—tax cuts and deregulation—which directly reflected the administration's goal of limiting the scope of federal intervention and changing the post-New Deal consensus regarding the role of government.

Step-by-Step Solution

1
Analyze the stimulus to identify the core historical argument.
The historian argues that the Reagan administration shifted the political debate away from the post-New Deal consensus of expanding federal welfare and regulatory responsibilities, framing the federal government itself as the problem.
Understanding the core argument is necessary to connect it with the correct policy action.
2
Connect the historian's argument to specific economic policies of the Reagan administration.
Reagan's domestic policy agenda (Reaganomics) sought to limit federal intervention in the economy.
This establishes the historical context of the administration's goals.
3
Identify the policy option that embodies this shift toward limited government.
Supply-side economics, which prioritized tax cuts and deregulation, directly aligned with the goal of reducing the federal government's role in the marketplace.
This isolates the correct choice based on historical evidence.
4
Evaluate the distractors to confirm they represent incorrect policies or historical inaccuracies.
Options advocating for expanding social spending, increasing regulation, or cutting military spending to balance the budget are historically incorrect or run counter to the conservative shift described.
This ensures the distractor options are properly eliminated.

Key Concept

The shift from the New Deal/Great Society liberal consensus to conservative supply-side economic policies under the Reagan administration.
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Topics

Reaganomics and Domestic Policy under Reagan and Bush

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