During his time as Federal Reserve chairman (1979-1987), Volcker imposed sky-high interest rates under the theory it would rein in the [[inflation]] caused by President [[Jimmy Carter]] and the energy crisis of the 1970s. Volcker continued to ratchet up interest rates with doubtful benefit during the first two years of Reagan's presidency, causing losses in the [[midterm election]] to the [[Republican Party]] in 1982 to the glee of [[Democrat]]s. When the effect of Reagan's tax cuts kicked in, the economy improved and inflation ultimately subsided, and Reagan himself was reelected in an historic landslide in 1984. | During his time as Federal Reserve chairman (1979-1987), Volcker imposed sky-high interest rates under the theory it would rein in the [[inflation]] caused by President [[Jimmy Carter]] and the energy crisis of the 1970s. Volcker continued to ratchet up interest rates with doubtful benefit during the first two years of Reagan's presidency, causing losses in the [[midterm election]] to the [[Republican Party]] in 1982 to the glee of [[Democrat]]s. When the effect of Reagan's tax cuts kicked in, the economy improved and inflation ultimately subsided, and Reagan himself was reelected in an historic landslide in 1984. |