Reasons why the USSR Collapsed
Economic Stagnation: by the 1980s, there was zero economic growth, development of the black market for consumer goods, could not produce enough grain, rationing of food, consumer goods were inferior, poor use of resources (Pipeline)
Military Spending: 15-25% of GNP, Americans spent only 5-7%, too much on guns, not enough on butter.
Political Stagnation and Corruption: Party officials lived a privileged life, they did not want reform when it was most needed.
Ideology: Command economy, complete centralized planning, individual initiative is replaced by quotas and threats.
Nationalism: 50% of the population was not Russian, the non-Russian ethnic groups would fuel the break-up in combination with economic problems and the unwillingness of the new Russian govt to turn guns on its own people, like they had before.
At the end of the day people didn't care about politics, they wanted food and they rebelled against their political leaders.
Gorbachev could not secure large foreign loans.
The USSR, lost control though because of its out of control spending in trying to keep up with the United States military build up and practically bankrupted themselves and the people rebelled.
Facts on Reagan
Facts
Between 1980-1990
1- Total federal revenues doubled from just over $517 billion in 1980 to more than $1 trillion in 1990. In constant inflation-adjusted dollars, this was a 28 percent increase in revenue.
2- As a percentage of the gross domestic product (GDP), federal revenues declined only slightly from 18.9 percent in 1980 to 18 percent in 1990.
3- Revenues from individual income taxes climbed from just over $244 billion in 1980 to nearly $467 billion in 1990.5 In inflation-adjusted dollars, this amounts to a 25 percent increase.
4- This economic boom lasted 92 months without a recession, from November 1982 to July 1990, the longest period of sustained growth during peacetime and the second-longest period of sustained growth in U.S. history. The growth in the economy lasted more than twice as long as the average period of expansions since World War II
5- The American economy grew by about one-third in real inflation-adjusted terms. This was the equivalent of adding the entire economy of East and West Germany or two-thirds of Japan's economy to the U.S. economy.
6- From 1950 to 1973, real economic growth in the U.S. economy averaged 3.6 percent per year. From 1973 to 1982, it averaged only 1.6 percent. The Reagan economic boom restored the more usual growth rate as the economy averaged 3.5 percent in real growth from the beginning of 1983 to the end of 1990
7- In 1991, after the Reagan rate cuts were well in place, the top 1 percent of taxpayers in income paid 25 percent of all income taxes; the top 5 percent paid 43 percent; and the bottom 50 percent paid only 5 percent. To suggest that this distribution is unfair because it is too easy on upper-income groups is nothing less than absurd.
No matter how advocates of big government try to rewrite history, Ronald Reagan's record of fiscal responsibility continues to stand as the most successful economic policy of the 20th century. His tax reforms triggered an economic expansion that continues to this day. His investments in national security ended the Cold War and made possible the subsequent defense spending reductions that are largely responsible for the current federal surpluses. His efforts to restrain the expansion of federal government helped to limit the growth of domestic spending. Reagan took over an economy with double-digit inflation and almost no growth, yet left office with much lower inflation than he inherited and a strongly growing economy.
