Economics

Reagan's Economic Legacy

His policies helped spur the 1980s boom and were integral to the high-tech revolution. But the poor paid a price

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June 21, 2004 at 4:00 AM UTC

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On Aug. 13, 1981, President Ronald Reagan signed the legislation that defined his vision for the U.S. economy. The Economic Recovery Tax Act, also known as the Kemp-Roth bill, slashed taxes for many individuals and corporations and ushered in a new era. From that date on, government would play a far smaller role in the economy, and markets would reign supreme.

Just the previous day, with far less attention and fanfare, IBM (IBM ) announced the introduction of its first personal computer, the IBM PC. Powered by a microprocessor from Intel Corp. (INTC ), which then had revenues of less than $1 billion, and sporting an operating system by a virtually unknown company called Microsoft Corp. (MSFT ), the IBM PC, and the machines that followed, took the country by storm.