We can get our clothes and iPods from China for very cheap, but where has that gotten us? A communist rival of Reagans' is now a superpower. Not only that, but a large amount of jobs got outsourced to China or to other parts of Asia. The entire manufacturing industry in the United States is basically dead because of the cheap labor available in China.
Education is another problem with the United States, you need to have it get any reasonably good job, but the cost does nothing but go up. Once you do graduate, you spend years paying off loans that you either got from the government, or even worse, private banks. That is IF you get a good job, when in fact you might have to go to Graduate school right after. I can see your argument as valid if the education system worked in this country similarly to Canada or Europe, where basically everyone can go to college, they only need to prove that they are intelligent enough, not wealthy enough.
The way the economy works now, and even back then, does not push the wealthy to spend on the sectors of the economy that truly help the lower classes. Why would they spend, when they can grow wealthy through investing? Nowadays when investors do spend, middle classes still get hurt the most because of the greed of the upper class. The credit crunch is a prime example, investor groups like mutual and sovereign funds wanted more and more CDOs so more people were given mortgages who shouldn't of gotten them, which lead to sub-prime mortgages. Eventually everyone ended up holding toxic assets, and the middle and lower class ends up without jobs while the large investing groups got away clean. Reagan built his economy on greed, and it did nothing but hurt everyone else.
You make a lot of assumptions about the lower class it seems, do you really believe that ALL members of the lower class have no incentive to be more productive? Maybe they are just stuck in a cycle of poverty, did you ever consider the people who just don't have the time and money for college who simply have to work to help their family? The middle class suffered tremendously as well, though that was not felt until later. They paid later when companies were not as profitable as they should of been to support the supply side model. The middle class were left out to dry, at least the lower class had a safety net.