White Paper Series Title: "Reviving America: A Supply-Side Blueprint for Economic Freedom"

Part 2:
Reaganomics: The Supply-Side Revolution That Rescued America from Stagnation

Author: the Conservative TAKE contributor
Date: April 10, 2025
Prepared for: Constitutional Conservatives, Supply-Side Advocates, and American Patriots

Executive Summary

The 1980s were a turning point in American economic history. After a decade of Keynesian chaos, runaway inflation, and stagnation under Presidents Nixon, Ford, and Carter, Ronald Reagan brought a bold, unapologetic return to supply-side economics. Through massive tax cuts, deregulation, sound money, and restoring business confidence, Reagan ignited one of the greatest economic expansions in U.S. history.

This paper analyzes how Reagan reversed the exact same mistakes made by Hoover, FDR, and other central planners during the Great Depression—and how his policies vindicated the free market, disproved Keynesian myths, and laid the groundwork for long-term prosperity.

I. The Economic Crisis Reagan Inherited

When Reagan took office in January 1981, America was in a deep crisis:

• Inflation: Over 13%

• Unemployment: 7.5% and rising

• Interest rates: Over 18%

• Growth: Negative GDP in 1980–82

• Morale: National despair, declining productivity, and a “malaise” economy

This was stagflation—a toxic mix of inflation and stagnation that Keynesian models said was impossible. But it was real, and it was devastating.

II. Reagan’s Supply-Side Strategy

Reagan knew the answer wasn’t more government—it was unleashing the private sector. Guided by classical economists like Milton Friedman, Arthur Laffer, Jude Wanniski, and Jack Kemp, Reagan implemented a four-part strategy.

A. Major Tax Cuts: Incentivizing Work, Saving, and Investment

Economic Recovery Tax Act of 1981 (ERTA)

• Cut top individual tax rate from 70% to 50%

• Across-the-board income tax cuts of 25% over three years

• Introduced Accelerated Cost Recovery System (ACRS) to promote capital investment

• Indexed tax brackets to inflation (ending “bracket creep”)

Results:

• Private investment surged

• Job creation exploded

• Revenues eventually increased, despite lower rates (Laffer Curve in action)

Contrast with FDR: While Roosevelt raised taxes on businesses and individuals, Reagan cut taxes to unleash the supply side of the economy.

B. Monetary Discipline: Fighting Inflation Without Killing Growth

While Reagan’s team handled fiscal policy, Federal Reserve Chairman Paul Volcker, supported by Reagan, slammed the brakes on inflation with tight monetary policy.

• High interest rates were painful (recession in 1981–82), but short-lived

• Inflation dropped from 13.5% in 1980 to 3.2% by 1983

• Reagan stood firm and let the market adjust

Contrast with the 1930s Fed: Instead of shrinking the money supply like the Great Depression era, Reagan supported tight but rational monetary policy—short-term pain, long-term gain.

C. Deregulation: Restoring Free Market Competition

Reagan slashed regulations that stifled industry:

• Airlines, trucking, energy, and telecommunications were freed from decades of red tape

• Reduced the top marginal capital gains tax

• Ended price controls and wage controls from the Nixon-Carter era

Impact:

• Lower costs

• More innovation

• Greater productivity and competition

Contrast with the New Deal: Reagan dismantled the bureaucratic grip on the economy, while FDR expanded it through agencies like the NRA, AAA, and SEC.

D. Rebuilding Business Confidence

Reagan knew that entrepreneurs are the engine of the economy. His policies and rhetoric signaled clearly: America was open for business again.

• No more demonizing “the rich” or “profits”

• Emphasized private enterprise, family values, and self-reliance

• Reagan restored economic optimism, and confidence fueled growth

Contrast with Hoover/FDR: Reagan didn’t create “make-work” jobs—he freed the market so real jobs could flourish.

III. Economic Results of Reaganomics

The results were undeniable—and historically unmatched:

And let’s not forget: Reagan rebuilt the military, defeated communism, and restored American pride. His economic success laid the foundation for the tech boom of the 1990s, driven by the investment climate he created.

IV. Addressing Keynesian and Leftist Critiques

Claim: Reagan created deficits.
Truth: Congress kept spending. Reagan cut tax rates, but revenues rose. The problem was spending, not tax cuts.

Claim: Reaganomics helped only the rich.
Truth: Middle-class incomes rose, inflation fell, and unemployment dropped. Wealth creation helped everyone—especially those who work.

Claim: Trickle-down doesn’t work.
Truth: It's not “trickle-down”, it's supply-side. When you let producers produce, the whole economy grows.

V. In the end... A Blueprint for Revival

Reagan didn’t guess. He learned from the past. He looked at what failed in the 1930s—high taxes, big government, central planning—and did the opposite.

He proved:

• Freedom works

• Lower taxes = higher growth

• Stable money = sound economy

• Deregulation = innovation

• Confidence in capitalism = jobs and prosperity

The legacy of Reaganomics is clear: when America returns to limited government and economic liberty, it thrives.

Key Sources

• Friedman, Milton. Free to Choose (1980)

• Laffer, Arthur. The End of Prosperity (2008)

• Reagan, Ronald. An American Life (1990)

• Wanniski, Jude. The Way the World Works (1978)

• Gilder, George. Wealth and Poverty (1981)

• Stockman, David. The Triumph of Politics (1986)

• Moore, Stephen and Laffer, Arthur. Return to Prosperity (2010)

• U.S. Bureau of Economic Analysis, Historical Tables

• Heritage Foundation Economic Policy Archives

• Cato Institute, “Reaganomics at 40” symposium (2021)
  
  

Tomorrow, we conclude with Part 3 which reveals how Trump used tariffs strategically, calmed markets, and turned the world against China, fueling a market surge and reaffirming America's dominance in global trade. Title: Trump’s America First Economy: Beating China and Boosting Markets

White Paper Series Title: "Reviving America: A Supply-Side Blueprint for Economic Freedom"

Part 1:
The Great Depression Revisited: How Government Intervention Created a Crisis and How Supply-Side Economics Could Have Prevented It

Author: the Conservative TAKE contributor
Date: April 9, 2025
Prepared for: Advocates of Free Markets, Fiscal Sanity, and American Prosperity

Executive Summary

This paper challenges the mainstream narrative that the Smoot-Hawley Tariff was the primary cause of the Great Depression. While tariffs worsened global trade conditions, they weren’t the root cause of the Great Depression. The real problem was timing, imposing high tariffs during a fragile economic downturn was bad policy. Not because tariffs are inherently harmful, but because they were stacked on top of monetary collapse and collapsing confidence. In a stronger economy, they might’ve been manageable. But in 1930, they added fuel to a fire already lit by the Federal Reserve and government overreach.

The evidence shows that monetary mismanagement by the Federal Reserve, destructive tax and regulatory policy, and massive expansion of government intervention, particularly through FDR’s New Deal, were the primary drivers of the Depression’s depth and duration.

From a supply-side economics perspective, the Depression was a predictable outcome of bad policy, not a failure of capitalism. This paper draws on the work of Milton Friedman, Anna Schwartz, Robert Higgs, and others to show how America could have avoided the Depression altogether if it had stayed true to limited government, sound money, and free markets.

I. The Real Causes of the Great Depression

A. Federal Reserve’s Catastrophic Monetary Policy (1929–1933)

According to Milton Friedman and Anna Schwartz in A Monetary History of the United States (1963), the Federal Reserve contracted the money supply by nearly one-third from 1929 to 1933. This was not a market failure; it was government incompetence.

• The Fed raised interest rates in 1928–29 to curb stock speculation—too tight, too fast.

• After the crash, it failed to act as a lender of last resort, letting thousands of banks collapse.

• The result was a deflationary spiral—prices fell, wages fell, debts became unpayable.

Quote from Friedman:

“The Depression was the consequence of a monetary contraction by the Federal Reserve System that started in 1929 and continued until early 1933.”

This destruction of liquidity dried up investment and demand not because people stopped spending, but because the Fed sucked money out of the economy.

B. The Smoot-Hawley Tariff: Scapegoat, Not Catalyst

The Smoot-Hawley Tariff Act (1930) raised tariffs on over 20,000 imported goods. Keynesians and leftists love to blame it, but the data and historical timeline show it was not the trigger.

Facts:

1. Stock Market Crash (October 1929) happened before Smoot-Hawley passed.

2. International trade was only about 7% of U.S. GDP—not enough to collapse the economy.

3. Yes, retaliatory tariffs hurt exports, but domestic spending and employment were already falling before the tariff was enforced.

4. The Depression worsened after massive monetary contraction, not immediately after tariffs.

Sources:

• Barry Eichengreen, Golden Fetters (1992) – notes that countries that stayed on the gold standard suffered worse declines than those that devalued.

• Douglas Irwin, Peddling Protectionism (2011) – shows Smoot-Hawley had limited macroeconomic impact compared to monetary and fiscal errors.

Conclusion: Tariffs were poorly timed policy during an already fragile economic moment—not because tariffs are inherently bad, but because they added pressure when the real crisis was being driven by monetary collapse and federal mismanagement. In a healthier context, strategic tariffs can protect national interests, but in 1930, they were gasoline on a fire lit by the Federal Reserve and big-government overreach.

C. Fiscal Folly: Hoover and Roosevelt Raised Taxes

Both Herbert Hoover and Franklin Roosevelt increased taxes during a depression, which killed recovery.

• Revenue Act of 1932 (Hoover): Raised top income tax from 25% to 63%

• Revenue Acts of 1935, 1936, and 1937 (FDR): Introduced wealth taxes, corporate taxes, dividend taxes

• This drained private capital from the economy, reducing business investment and job creation.

Source: Alvin Hansen, Fiscal Policy and Business Cycles (1941) – admits New Deal taxes slowed recovery.

D. FDR’s New Deal: Central Planning, Not Recovery

FDR’s New Deal was not stimulus. It was economic micromanagement. It introduced policies that froze markets, punished producers, and rewarded political allies.

Key Failures:

1. National Industrial Recovery Act (NIRA, 1933)

   • Created cartels, set wages and prices by government decree

   • Crushed competition and was ruled unconstitutional in Schechter Poultry Corp. v. U.S. (1935)

2. Agricultural Adjustment Act (AAA)

   • Paid farmers to destroy crops and livestock to raise prices

   • Starved the poor and created artificial scarcity

3. Wagner Act (1935)

   • Empowered unions to demand higher wages, reducing employment

   • Small businesses couldn’t afford the mandates

4. Public Works and Relief Programs

   • Created temporary jobs with no lasting value

   • Replaced private enterprise with government dependency

Robert Higgs in Crisis and Leviathan (1987) called this “regime uncertainty”—businesses froze hiring and investment because they feared more regulation, taxes, or seizures.

E. Empirical Evidence: The Recovery That Never Came

• Unemployment never fell below 14% during the entire 1930s.

• Private investment did not return to pre-1929 levels until after World War II.

• GDP growth was artificially propped up by government spending, not private production.

FDR’s own Treasury Secretary, Henry Morgenthau, testified before Congress in 1939:

“We have tried spending money. We are spending more than we have ever spent before and it does not work... we have just as much unemployment... and an enormous debt to boot.”

II. How Supply-Side Economics Would Have Prevented It

A. Maintain a Stable Money Supply

• Friedman’s rule: Keep monetary growth predictable and moderate.

• No deflationary spiral, no bank panics, no wipeout of savings.

B. Cut Taxes to Encourage Production

• Reward work, savings, and investment.

• Let entrepreneurs rebuild without fear of confiscation.

C. No Price Controls, No Central Planning

• Prices are signals. Government has no business setting them.

• Let markets clear. Let competition allocate resources efficiently.

D. Poorly Timed Tariffs, Not the Idea of Tariffs Themselves

• The economy was already collapsing due to deflation, falling demand, and tight Federal Reserve policy.

• Tariffs added fuel to the fire by straining international trade right when global cooperation was needed most.

• The Federal Reserve failed to respond, allowing monetary contraction and bank failures to continue unchecked.

• Tariffs in a strong economy can protect key industries, but in a fragile economy, they can deepen a crisis.

• Instead of protecting markets, Smoot-Hawley isolated them, damaging U.S. exports and worsening the downturn.

III. In the end... Freedom, Not Central Planning, Leads to Recovery

The Great Depression was not a failure of capitalism. It was a failure of interventionism. The Federal Reserve choked the money supply. Politicians raised taxes and stifled business. And FDR’s New Deal created a decade of stagnation, not salvation.

Had America followed the supply-side blueprint—low taxes, stable money, and limited government—the Depression would have been a short, sharp correction, not a prolonged disaster.

Key Sources 

• Friedman, Milton & Schwartz, Anna J. A Monetary History of the United States, 1867–1960 (Princeton University Press, 1963)

• Higgs, Robert. Crisis and Leviathan (Oxford University Press, 1987)

• Irwin, Douglas A. Peddling Protectionism: Smoot-Hawley and the Great Depression (Princeton University Press, 2011)

• Powell, Jim. FDR’s Folly: How Roosevelt and His New Deal Prolonged the Great Depression (Crown Forum, 2003)

• Rothbard, Murray N. America’s Great Depression (Ludwig von Mises Institute, 2000 edition)

• Eichengreen, Barry. Golden Fetters (Oxford University Press, 1992)

• Morgenthau Diaries and Congressional Testimony (1939)
  
  
  In Part 2, tommorrow, we show how Reagan reversed 1970s stagnation with bold tax cuts, deregulation, and pro-growth policies, proving the power of supply-side economics in real time.

Restoring National Sovereignty Through Economic Nationalism: A Return to Founding Principles

In a passionate and sweeping monologue, Dr. Steve Turley outlines what many conservatives and constitutional originalists see as a long-overdue rejection of the globalist economic order and a return to America's founding principles. This shift is not merely economic, it is cultural, civilizational, and deeply constitutional. As he rightly frames it, America is witnessing the collapse of liberal globalism and the rebirth of a sovereign economic and national identity grounded in mercantilism, national security, and self-reliance.

Mercantilism and the Constitution: The Founders' Vision

Dr. Turley’s invocation of mercantilism, a 17th-century economic model where trade is viewed as an extension of national power finds deep resonance with the Founding Fathers' vision for the United States. As outlined in Federalist No. 11, Alexander Hamilton emphasized the importance of a robust commercial policy to secure American interests. He recognized the necessity of protecting nascent industries from foreign powers through tariffs and national economic planning, all aimed at achieving independence.

This is the kind of economic nationalism Donald Trump has reintroduced. It is one that restores the federal government’s Article I, Section 8 power: "To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes." Under globalism, this clause has been distorted to facilitate massive offshoring of American jobs. Under mercantilism, it becomes a constitutional vehicle for protecting national industry and ensuring America’s independence from hostile foreign powers.

Globalism's Constitutional Crisis: Delegation and Sovereignty

The Bretton Woods system, as described by Dr. Turley, created supranational institutions like the World Trade Organization and International Monetary Fund which entities that function without any direct constitutional authority. This transfer of economic sovereignty to international bureaucracies undermines the very premise of the U.S. Constitution: that all legislative power resides in Congress (Article I, Section 1). The rise of globalism has resulted in unelected international bodies dictating trade policy, thereby bypassing the democratic will of the American people.

Justice Clarence Thomas has consistently warned about such extraconstitutional governance. In his concurring opinion in Department of Transportation v. Association of American Railroads, Thomas observed that delegating core governmental functions to unaccountable entities is incompatible with the Constitution. Globalism, in this sense, is not just economically damaging;it is constitutionally illegitimate.

Tariffs and National Security: A Constitutional Imperative

Turley’s focus on tariffs and their national security implications highlights another core constitutional principle: the duty of government to "provide for the common defence." If the United States cannot produce its own pharmaceuticals, steel, or ships, it cannot defend itself in wartime. The Framers understood that sovereignty includes economic self-sufficiency. They would have been appalled by a system where America's primary military and health needs are met by potential adversaries like China.

Trump’s tariff policies are not protectionist in the pejorative sense, they are patriotic, prudent, and constitutional. They ensure the survival of the Republic by preventing economic entanglements from becoming national vulnerabilities.

Civilizational Spheres and Federalism

One of the most fascinating insights Turley provides is the rise of “economic civilizationism,” where trade blocs are reorganizing along civilizational lines: North America, Eastern Europe, East Asia. This is entirely consistent with the original federal structure of the United States: a decentralized union of states with shared values and a common destiny.

Trump’s efforts to build a North American trade sphere with Canada and Mexico, anchored not in globalist abstraction but in reciprocal tariffs and economic cooperation, mirror the original constitutional compact between sovereign states. It's a model of federalism writ large on the international stage.

Globalism’s Demise and the Renewal of the American Republic

Globalism was always destined to fail. It undermined national self-government, hollowed out the American manufacturing base, and imposed alien cultural values under the guise of economic cooperation. Dr. Turley rightly notes that globalism has become a weapon of woke ideological coercion, exploited by Western elites to enforce cultural conformity.

But the Constitution provides the remedy. A return to limited government, national sovereignty, and constitutional commerce powers is not just a policy choice. It is a return to first principles. As James Madison wrote in Federalist No. 45, “The powers delegated by the proposed Constitution to the federal government are few and defined.” That includes the power to protect our economy from globalist overreach and defend our way of life from foreign entanglements.

In the end... A Constitutional Revival

Dr. Turley’s vision aligns closely with the conservative legal movement’s call to restore the Constitution as it was originally understood. Economic nationalism, reciprocal trade, and self-sufficiency are not just prudent strategies—they are constitutional imperatives. In rejecting liberal globalism, we are not turning away from modernity; we are turning back to the enduring wisdom of our Founding Fathers.

The liberal order is dying. What comes next is a restored Republic. One that is strong, sovereign, and rooted in the Constitution.