REAGONOMICS & THATCHERISM A CHC 2D Canadian History Presentation

NEW GOVERNMENTS in 1979, Britons elect Tory Margaret Thatcher as the UK’s first female Prime Minister in 1980, anger at Jimmy Carter’s inability to get back the hostages in Iran results in Republican Ronald Reagan coming into power Reagan and Thatcher respond to the economic problems of stagflation in a similar way — that is notably different than governments before

THATCHERISM Thatcher’s government believes in monetarism monetarism comes from American economist Milton Friedman, and states that inflation is the problem: the more money there is in the system, the higher the prices will rise to keep the supply matching demand Thatcher’s government focuses on the money supply they also dealt with industry by closing down mines in favour of new technologies… which hurt much of the working class

THATCHERISM the middle class, on the other hand, was helped because the Thatcher Tories allowed them to buy property they had previously been renting from the upper classes which had owned them for centuries before the result was a shift in wealth and an expansion of who had assets they could invest in the economy and move it forward the goal was to increase investment at home — because nationalism was a strong message that was appreciated

THATCHERISM after the failure of the Suez Crisis, Britain had taken America’s lead in international affairs — after all, it was America that had the military strength to hold off the Soviets, not Europe Britons wanted a return to international presence this manifested most in Britain’s fight with Argentina over the Falkland Islands in 1982 Argentina wanted them back from Britain but Thatcher would not relent — and the British eventually won the war

REAGAN Reagan also wanted to increase national investment, but did it a completely different way Reagan lowered taxes on the upper class to free up their disposable income that, in turn, was supposed to be invested into companies so that the middle class would be hired — kickstarting the economy critics called this “trickle down” theory Reagonomics

CONFLICT when it came to militarism, Reagan found himself facing a U.S.S.R. determined to reassert its power as well the Soviets had moved into Afghanistan in 1979 to support its new pro-communist government the United Nations tried to order them out, but the Soviets refused — and soon came into conflict with local forces that were anti-Soviet

CONFLICT the United States responded by sponsoring the rebels with money and weapons to use against the Soviets rebel leaders such as Osama Bin Laden also got access to American intelligence and training in order to be more effective this allowed the U.S. to stay out of direct conflict with the Soviets but there was another problem the Soviets were building better missiles and this was kicking off another arms race between the two superpowers

REACTIONS Thatcher agreed with Reagan and the two grew very close in friendship Canada’s Prime Minister, Pierre Trudeau, didn’t share the same views Trudeau was against the reduction of taxes because he saw them as necessary for maintaining the social security network he and Pearson put in place after meeting Reagan in Washington, Trudeau called it “poppycock” and then pirouetted before the press to emphasize how much of a fairy tale he thought it was