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Reagan's domestic economic policy centered on the "Trickle Down" policy -- reduce or eliminate regulations on businesses and give tax breaks to the highest economic earners, and the benefits would trickle down to the lower economic classes.
Unfortunately, Reagan forgot to take into account the reason that the top economic class is rich: They keep their wealth and accumulate more while spending the least possible. With deregulation, the CEO's found even more loopholes to save on the taxes they weren't paying.
The Trickle Down theory was also known as "Reaganomics."
The economic ideas Reagan took into office included supply-side economics and trickle-down economics.
Supply-side economics, as applied by Reagan in his Economic Recovery Tax Act of 1981, says that if taxes are reduced on the rich, said rich people will produce lots of stuff and people will buy it, hence boosting the economy.
Trickle-down economics says if the rich receive tax cuts, the benefits will trickle down to the working class.
There are differing opinions on the success/failure of these policies.
Reaganomics:
Relaxing environmental standards against union activities
Reaganomics Relaxing environmental standards against union activities
One of the major components of Ronald Reagan's economic plan was to reduce government spending. The second component was to reduce income tax rates.
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