US Presidency
1982

Few could or would afford the high interest rates for home mortgages or installment buying of an automobile. Meantime, we were putting our economic recovery program in place. It wasn't easy. We didn't get all the cuts we wanted. And we got some tax measures we didn't want. But we were charting a complete turnaround in government policy, and we did get the major part of what we proposed. The Congress mandated spending cuts of $ 130 billion over 3 years and adopted the biggest tax cut in history. Now, this, too, was to be implemented over a 3-year period. It began with a 5-percent cut in the personal income tax beginning October 1st, 1981, then a 10-percent cut this last July, and another scheduled for July 1st, 1983. These will be followed by indexing of the tax brackets so workers getting cost-of-living pay raises won't be moved up into higher brackets. We have to realize inflation itself is a tax. Government profits by inflation, but indexing will put a stop to that.