America in the 1980’s: An Overview

1. America in the 1980’s: An Overview

2. America in the 1980’s • The challenges of America that followed the Watergate scandal, the energy crisis and Vietnam would have dimmed the national optimism that followed World War II • Former California Governor Ronald Reagan proposed to restore national optimism though conservative government and aggressive foreign policy • The 1980’s would usher in a new age of growth and the end of the Cold War • As is always the case, we can also see the seeds of future challenges in American society being sown in the 1980’s • Global terrorism • Growing economic inequality

3. The Conservative Revolution • Governor Reagan would challenge President Carter in the election of 1980 as it was mired in great foreign and domestic challenges • American were taken hostage in Tehran, Iran in November 1979 • Protesting America’s support of the brutal dictatorial rule of the Shah who had fled to America following a revolution • American economy suffering another energy crisis and high inflation • Americans were growing frustrated by feeling of weakness and lack of strong leadership • President Reagan promised to restore America leadership America’s leadership in the world • Ran along with Republican rival George HW Bush for VP

4. President Reagan won a resounding victory in 1980 • Reagan received strong report from the New Right including conservative Christians in the newly organized Moral Majority • Felt that Christian values and liberalism had pushed America of its moral center • Felt welfare and civil rights policies compromised • Pushed for the reversal of the Roosevelt-Johnson welfare state • Reagan’s big win in 1980 gave his conservative program a mandate

5. A Conservative Administration • President Reagan promised a departure from liberal social programs and regulation to restart the American economy • Free market economy and deregulation • Allow the forces of capitalism dominate economic activity • Lower taxes • Decrease social welfare programs to manage spending • Conservative social values • Support of school prayer • Gun rights • Anti-abortion • These ideas made him popular among the New Right and Moral Majority • This support would dominate presidential politics for 12 years to 1992 • Reagan was known as the Great Communicator-effective at communicating conservative message

6. Reaganomics: Engineering a Recovery • President Reagan viewed high taxes and regulation as the cause of America’s anemic economy • Solution- Reaganomics (aka “trickle down economics) • Cut income tax on wealth to encourage investment and job creation • Cut regulation that made economic development more difficult • Open public lands for economic development • Benefits would “trickle down” to the middle class and poor

7. The success and failure of Reaganomics • Success • Knocked down inflation and unemployment- stagflation was gone by 1983 • Stock market soared through much of the 1980’s • On average, Americans were earning 10% more in inflation adjusted dollars by the end of the Reagan years • Problems • Tax cuts and growing defense spending increased budget deficits and accumulated national debt • Deregulation of banks and stock market generated significant meltdowns by 1987 • Environmental deregulation hurt the environment • The distribution of income between rich and poor widened

8. Reagan and the World: • President Reagan promised a hard line against the Soviet Union • Referred to the Soviet Union as The Evil Empire • Believed that aggressive posturing was the way to engage the Soviet Union- not morality or realpolitik • American hostages in Iran freed the day Reagan was inagurated • Reagan engineered the largest peace time expansion of the military in American history • Budget nearly doubled • Push to develop Strategic Defense Initiative • Make Soviet missiles powerless through laser interception • Critics called it Star Wars- impractical • Reagan’s critics claimed he neglected the poorest Americans to build weapons

9. Attracting Criticism • The combination of higher defense spending and cuts to social programs angered many • Reaganomics made some investors rich but left many people without support • Were the costs of Reaganomics and the defense build up worth it?

10. Pressing the Evil Empire and Global Communism • 1980 might be considered the high point in the power and influence of global communism • Communist governments dominated Eastern Europe, China, southeast Asia as well as the USSR and were growing in Africa and Latin America • Tensions with the Soviet Union deepened- (détente broke with the Soviet invasion of Afghanistan in 1979)

11. Cold War Challenges: First Term • Poland 1981 • Americans warned Moscow not to invade Poland when a growing labor movement Solidarity challenged martial law declared by Poland’s government • Near Korea 1983 • Korean passenger airliner shot down by Soviet fighter- claims it was a spy plane • Europe 1983- Americans place nuclear weapons in Britain and Germany • Soviets and Warsaw Pact boycott 1984 Los Angeles Olympics- joined by many Communist countries • President Reagan supported anti communist groups in Latin America while knocking out a communist government in Grenada in 1983 • Opponents wanted to limit America’s support of anti-communist forces in Nicaragua (Contras)- another Vietnam?

12. Morning in America: The Reagan Reelection of 1984 • President Reagan easily won reelection in 1984 against Democrats Walter Mondale and Geraldine Ferraro • Reagan Campaign Ad- Why was this message effective? • Reagan won by a larger margin than 1980 • Reagan became the oldest American inaugurated as President

13. Economic Challenges: The Public Sector • Higher defense spending and tax cuts induced soaring budget deficits that Reagan vowed to stop • Gramm-Hollings Act required across the board cuts in government spending to address deficits • Federal Deficit- gap between budgeted government income and spending • Federal Debt- accumulated money owed to banks and individuals loaning money to the federal government • Budget deficits and debts have been a federal problem since the New Deal and World War II

14. A Look at Budget Deficits

15. Economic Challenges: The Private Sector • Deregulation of the economy was supposed to stimulate economic growth • Less regulations invited corruption • Insider trading scandal in the stock market • The use of confidential information to gain advantage in the purchase and sale of stocks • This was a cause of the collapse of the market in 1929 • Discourages most people from investing- like poker with a stacked deck • Decline in trust led to a market crash in 1987 bigger than 1929 • A crisis in the Savings and Loan banks generated by a collapse in real estate markets forced government to cover billions in losses • Neither crisis generated a depression… lingering power of New Deal?

16. A Foreign Policy Crisis: The Iran-Contra Affair • At any time in a presidency, the president will have a number of foreign policy crises • America’s anti-communist foreign policy supported the efforts of Nicaragua’s Contras • Pro-Iranian groups in Lebanon held American hostages • The president must work within the Constitution and Congress • The Reagan Administration tried to solve these problems outside of its legal rights

17. What happened? • Administration sold weapons to Iran • Iran desperate needed weapons for war against Iraq • America had no formal relations with Iran following hostage crisis • America hoped Iran would press pro-Iranian hostage takers to release hostages in Lebanon • Profits from sale diverted to anti-Communist contras • Congress had forbidden direct support of Contras • Reagan not directly involved by subordinates shredded documents • Members of the White House staff implicated • Reagan criticized for his lack of control over subordinates

18. The Warming of the Cold War • A new type of leader took control of the Soviet Union in 1985- Mikhail Gorbachev • Economic reformer- perestroika • Push to create a consumer economy- cut down government and military spending • Political reformer- glasnost “openness” • Freedom of expression • Gorbachev needed to negotiate to decrease military spending • Gorbachev grew popular in the United States • Hope to lower cold war tensions

19. Negotiating a Thaw in the Cold War • President Reagan and Chairman Gorbachev negotiated many important arms control agreements • Negotiated the end of intermediate range nuclear missiles in Europe and the end of the Soviet occupation in Afghanistan • Gorbachev renounced the use of force in foreign policy- later announced a policy of non-intervention in Eastern Europe • Anti-communist groups in Poland, Czechoslovakia and Hungary worked to unseat communist governments • Rebellion in East Germany led to resignation of its Communist leader • East German solders quit patrolling the Berlin Wall • 9 November 1989- Citizens of Berlin take the wall down- symbolic end of the Cold War in Europe

20. The Republican Revolution Continues • Vice President Bush continued Reagan’s policies defeating liberal Massachusetts governor Michael Dukakis • In his first year, communism collapsed- end of the Cold War • The Soviet Union breaks up on 25 December 1991- What a Christmas present for Cold Warriors!

21. A New Crisis in the Gulf • August 1990, Iraqi forces under Saddam Hussein invade oil rich Kuwait • Claim that it was historically part of Iraq • Iraq owed Kuwait money for its war against Iran • Nations in region concerned about Iraq’s power grab- America concerned about balance of power and oil wealth • UN condemned invasion • America and a coalition of countries mobilized troops in Saudi Arabia (1/2 million Americans) • Largest troop deployment since Vietnam • Wide global support • Waiting for 15 January 1991 UN deadline for Iraq withdraw

22. Overcoming the “Vietnam Syndrome” • President Bush believed it was important to clearly communicate that he was not LBJ and this was not Vietnam • Identified clear objectives- remove Iraqi forces from Kuwait • Identified limits of the mission- “no mission creep” • Provide full support for soldiers and sailrs deployed • Have allies • This war would last 100 hours and would meet its objectives

23. A New Kind of War • Step 1- Operation Desert Shield • Deploy troops to Saudi Arabia to check further Iraqi expansion • This would anger many in Saudi Arabia including Osama bin Laden- Crusaders in the Holy Land of the Prophet • Step 2- Air attack Operation Desert Storm • Bombing of Iraqi targets began 16 January • Hi-tech “smart bombs” do serious damage to Baghdad • Step 3- Operation Desert Storm Attack on Kuwait began 23 February • Iraqis driven out days later- 100,000 killed • United Nations forces accept a negotiated armistice with Saddam- • Quick decisive victory ends Vietnam Syndrome

24. Economic Challenges • President Bush inherited some of the problems of Reagan’s second term • Large budget deficits created by defense spending and tax cuts • Savings and Loan mess- cost of bail out • A trade deficit was a growing problem • Cities like Pittsburgh were ravaged by the decline of the steel industry • Auto industry continued to struggle with the challenge of foreign competition • American economy fell into recession • In spite of his challenge “read my lips, no new taxes” he raised taxes to bridge budget deficit • His popularity quickly fell as he approached election of 1992

25. American Political and Economic History… In a Nutshell • More conservative government ended stagflation of the 1970’s, but the plight of the poor became more difficult and distribution of income widened (rich got richer and poor got poorer) • A more aggressive foreign policy directed the end of the Cold War and pushed Iraq out of Kuwait in the Gulf War, but high military spending plagued the budget and new enemies in the Middle East would be looking for an opportunity to hit America • We will look at American social history and popular culture next…