Throughout 1981, Reagan frequently met with members of Congress, focusing especially on winning support from conservative Southern Democrats.In July 1981, the Senate voted 89–11 in favor of the tax cut bill favored by Reagan, and the House subsequently approved the bill in a 238–195 vote. The Economic Recovery Tax Act of 1981 cut the top marginal tax rate from 70% to 50%, lowered the capital gains tax from 28% to 20%, more than tripled the amount of inherited money exempt from the estate tax, and cut the corporate tax. Nonetheless, the national debt more than tripled between fiscal year 1980 and fiscal year 1989, going from $914 billion to $2.7 trillion, while national debt as a percentage of GDP rose from 33 percent in 1981 to 53 percent in 1989. Reagan never submitted a balanced budget during his time in office.In an effort to lower the national debt, Congress passed the Gramm–Rudman–Hollings Balanced Budget Act, which called for automatic spending cuts if Congress was unable to eliminate deficits through the regular budget-making process.
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