Final answer:
Ronald Reagan's economic strategy, known as Reaganomics, focused on cutting taxes for the wealthy, reducing federal spending on social programs, deregulating industry, and raising interest rates to control inflation. Critics highlighted rising national debt and wealth inequality as negative impacts of his policies.
Step-by-step explanation:
President Ronald Reagan's plan for pulling the United States out of its economic slump centered around a strategy commonly referred to as Reaganomics. This approach involved cutting taxes, particularly for the wealthy, in the belief that it would lead to investment and job creation. Additionally, Reagan focused on reducing federal spending on social programs, deregulating industry, and raising interest rates to curb inflation. Despite aiming to balance the federal budget, Reagan's policies led to a significant increase in the national debt and were criticized for widening the income disparity between the rich and the poor. Proponents of Reaganomics pointed to the increase in the Dow Jones Industrial Average, the reduction of inflation, and the decrease in unemployment as signs of success. Critics, however, highlighted the growing wealth inequality and the shift of manufacturing jobs overseas. During Reagan's tenure, the federal budget was never balanced, and the national debt grew substantially, raising questions about the long-term effectiveness of his economic policies.