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Is the Reagan-Thatcher Revolution Over?

CAMBRIDGE – Thirty years ago Ronald Reagan and Margaret Thatcher brought about a revolution in thinking and policy in both economics and foreign affairs. The economies of the United States and Britain are today fundamentally different because of what they did. The collapse of communism in Eastern Europe and the former Soviet Union is also the result of their policies.

Of course, Reagan and Thatcher have always had their critics, some of whom now believe that the world economy will revert to pre-Reagan and pre-Thatcher policies. But anyone who recalls what the American and British economies were like before Reagan and Thatcher, and who knows the changes that they introduced, must also recognize that the world cannot go back.

I had the good fortune to work with President Reagan as his chief economic adviser. Because of his close relationship with Prime Minister Thatcher, I also had several opportunities to meet with her. They were revolutionaries in their thinking and in their ability to inspire others to accept fundamental change.

Reagan had four key economic goals when he assumed office in 1981: reduce inflation, reduce high personal tax rates, reduce the size of government, and reduce regulation of the private sector.