Final answer:
Reagan was criticized for widening income inequality as a negative drawback of New Federalism.
Step-by-step explanation:
Reagan was criticized for a negative drawback of New Federalism related to widening income inequality (C). While Reagan promoted the idea of devolving power to the states and limiting federal government power, his approach to economic policies, such as tax cuts that primarily benefited the wealthy, contributed to an increase in income inequality. This led to criticism of his administration for not doing enough to address the growing wealth gap.