We lamented earlier this week that even Republicans seem to be open-minded to price controls on drugs, energy, food and anything else that is rising in price.

So here’s another history lesson: we saw one of the most rapid declines in inflation in American history during Ronald Reagan’s first two years in office. That happened while Reagan ENDED a decade of wage and price control experiments that all failed.

The chart below shows that in the aftermath of ENDING the Nixon-Ford-Carter era price controls, and passing the Reagan tax rate reductions, and, aided by then-Fed chairman Paul Volcker’s tight money policies, inflation plummeted from 11% to 3% in two years.

Ironically, Reagan’s critics on the left predicted that the tax cuts would overwhelm the economy with consumer demand and thus cause prices to skyrocket.  Some of his critics on the right said that budget deficits would cause inflation. They were wrong too. Tax rate reductions increased supply faster than demand.

Reagan Ended a Decade of Inflation