Reaganomics and Welfare

When President Reagan first took office in the early 1981, the country was facing an economic recession.  The President and his team worked swiftly to propose plans for economic recovery.  As a part of the President’s administration I helped with the planning.  We concluded that government spending had to be cut while simultaneously decreasing income taxes.  “Reaganomics” would have a trickle down effect: the tax cuts that would benefit the wealthy would trickle down and benefit the poor.

ImageIn order to decrease government spending, the President needed to cut funding for unsuccessful programs.  Many of the community action programs of the 1960s did not operate as originally intended and some were seen as failures.  President Reagan decided to withdraw federal funding for many programs, but “responsibility for efforts such as Aid to Families with Dependent Children and school lunches was shifted to individual states” (PBS).  By giving these programs back to the states, each state can mold the programs to fit the needs of their constituents.  A federally funded social service program must be the same throughout all states, and might not address all the problems each individual state has.  Now, the state governments can address their state’s most important social issues through their own state run programs.  Even President Reagan believed that state run programs would be more beneficial: “this will make welfare less costly and more responsive to genuine need because it will be designed and administered closer to the grass roots of people it serves” (Reagan).  To avoid any problems, the federal government agreed to fund the programs for ten years during its transition to the state level.  This shift to the local level “would save 25 percent in administrative costs” (Roberts).

In his 1982 State of the Union speech, President Reagan addressed those critics who believed decreasing government spending would hurt the poor.  To reiterate his speech, “the federal government will subsidize 95 million meals every day” (Reagan) and will continue funding the Head Start program.  Just last year, the federal government announced it would fund the Medicaid program in addition to the Medicare program.

The First Lady has been urging the President to create an anti-drug program.  As a result, we have been doing a lot of research on the drug problem in America.  Since drugs are a hazard on the community, especially in urban cities, an anti-drug program will only help the community.  From the way our research is going, it looks as though we will be drafting program details soon and a will hopefully have the program ready to begin in the next year.

The White House

February 1985


“Domestic Politics.” American Experience. PBS. Web. 22 Apr. 2012. <;.

Reagan, Ronald. “1982 State of the Union Address.” Address. The Capitol, Washington, DC. Jan. 1982. American Experience. PBS. Web. 20 Apr. 2012. <;.

Roberts, Steven V. “FIGHTING OVER BLOCK GRANTS CATCHES STATES IN THE MIDDLE.” The New York Times. The New York Times, 02 Aug. 1981. Web. 16 Apr. 2012. <;.

Photo credit: Getty Images

  1. shannaweitz
    April 25, 2012 at 12:02 pm

    I agree with President Reagan’s policies. In the face of fiscal strain, we can no longer afford to maintain the bloated government bureaucracy in charge of welfare, especially when many of these policies have proved unsuccessful. Further, the federal government should not be dictating the policies of the states. President Reagan, a true federalist, recognizes the importance of minimal government, and I applaud his efforts to reduce its role in welfare.

    • Community Activist
      April 26, 2012 at 3:41 pm

      President Reagan’s policies are an outrage! The trickle down effect does nothing more than benefit the wealthy, and New Federalism simply benefits the federal government by passing on the administrative costs and responsibilities to state governments. For Reagan, it’s not that the states should share more of the power it’s that they should share more of the cost. And who suffers the most from these policies? Those with the least political power: the poor. I understand the need to make government more efficient, but you should remember that every cut Reagan makes to nonprofits is a bed, a meal or a job for someone that truly needs it.

  2. The Federal Government
    April 30, 2012 at 10:43 pm

    We have received many complaints from community activists and welfare recipients about the president’s current tax cuts and reduction of government spending on community action programs. The president was not in an easy situation. It was difficult to cut funding for the poor, because even the president knew what it was like to struggle for work at a young age. The most pressing concern of this administration is fixing the economic recession. Everyone faces hardships during a recession, not just the poor. In order to solve the recession, the president had to take economic action that would provide a brighter economic future for our children and grandchildren. In order to do that, economic advisors urged President Reagan to cut government spending. We had to tighten our pockets, and look at the most inefficient spending and begin to cut funding unnecessary programs. As the academic mentioned, the federal government has become too involved in community action programs, to the point where they are becoming ineffective. The federal government’s involvement in these programs is more of hindrance than a benefit, and is causing unnecessary spending. Giving control to the states is actually better for the poor, and helps reduce inefficient government spending.

    As I mentioned in my post, the federal government will fund Medicaid in addition to the Medicare program. These burdens will not fall onto the states.

  3. The Mayor
    May 1, 2012 at 2:19 am

    While I understand your concerns with fiscal responsibility, I must ask whether or not it was necessary to reduce the powers of the federal and state governments to provide aid to local governments. Presidents Nixon, Ford, and Carter recognized some of the flaws with the Great Society programs but they were interested in tweaking and modifying the programs in place to try to create better programs. What I am trying to say is that I am not sure that cutting these social programs and reducing funds will help impoverished communities. Reagan claims to be a believer in federalism but I believe that perhaps having a supply of aid to states and cities will make them more willing to look for innovative approaches instead of just raising taxes and watching their states and cities collapse under economic strain and suburbanization. Baltimore has managed to find a way through an emphasis on urban redevelopment projects and tourism but I still believe that the Great Society is viable. It simply did not receive the proper support.

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