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Public Policy & Administration Name Institution Different presidents have diverse approaches to budgeting. President Ronald Reagan and president Obama had their own different approaches to budgeting. Comparing presidents Ronald Reagan and Barrack Obama approaches to budgeting, it is clear that both relied on deficits of the budget in order to fuel the economy (Stein & Jamieson, 2014). The approaches to budgeting by the two leaders showed a lot of differences, for instance even though both presidents relied on the deficits to control the economy; the deficits by Reagan were smaller compared to those of Obama. During the first term of Reagan presidency the deficit was only 4.3% of the GDP as compared to 9.1% of Obama’s first term. President Obama seems to have relied so much on the expanded federal expenditures; Reagan on the other hand made use of tax cuts (Stein & Jamieson, 2014). During Obama’s first term the federal expenditure was about 24.4% of the GDP while Reagan’s first term it was only 22.8%. According to Keynesian theory of economy, fiscal policies are capable of reducing the cases of unemployment. President Obama and other demand siders’ advocates for more expenditure with a claim that when there is more federal spending there will job creation and when those hired by the government spend, more jobs would be created. President Reagan and the supply-siders on the other hand favor tax reductions as it ensures more money on the hands of consumers and whenever they spend the money, more jobs would be created. After Obama took office in 2009, he proposed $831 billion as a stimulus package. Only 25% of this package constituted tax reduction as the
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