The first sessions of the 89th Congress passed into law a variety of proposals, some of which had been bottled up for years. Medicare, a system of health insurance for the elderly under the Social Security program, was established. The Voting Rights Act of 1965 outlawed illiteracy tests and removed other obstacles that tended to prevent blacks from exercising their right to vote. Two new federal departments–Housing and Urban Development, and Transportation–were set up. Federal aid to primary and secondary schools increased substantially. Responding to Johnson’s call for an “unconditional war on poverty,” the Congress enacted legislation liberalizing unemployment compensation, expanding the food stamp program, and enlarging opportunities for youth employment. No session of Congress since 1935 had matched this one in attacks upon social and economic problems.
37. President – Richard Milhous Nixon
Term – January 20, 1969 to August 9, 1974
As the United States shifted toward a peacetime economy, inflation and unemployment beset it. In 1971 Nixon temporarily froze wages and prices, cut federal spending, and announced that the United States would no longer convert foreign-held dollars into gold. The subsequent decline in the value of the dollar in relation to other major currencies made American goods less expensive abroad. Throughout 1972, signs of an economic recovery multiplied. Unemployment dropped. As the administration alternately tightened and loosened controls in a series of “phases,” the price of food, notably beef, rose sharply. The battle against inflation was complicated by shortages of some products, including gasoline, and foods. Nixon blamed inflation on Congress, and he vetoed bills that exceeded his budgetary recommendations.
Policies adopted by Arab countries in 1973 and 1974 jeopardized the U.S. economy. To dramatize their strategic position in world affairs, the Mideast oil-producing countries imposed a brief embargo on petroleum products and then sharply increased their prices. Inflationary pressures and the unemployment rate increased in the United States. Nixon advocated greater exploitation of U.S. energy reserves. He hoped the United States could end its use of foreign oil.
Efforts by Nixon to reform the nation’s welfare system met resistance in Congress, but in 1972 he won approval of a program to share federal revenues with the states.
Continued dissatisfaction with “establishment” values was translated into opposition to the Nixon administration. College students overwhelmingly opposed the war. Black and white radical movements, while condemning racism and U.S. foreign policy in Asia, occasionally resorted to bombings and other acts of terrorism. Nixon, Vice President Agnew, and Attorney General John Mitchell deplored lawlessness while upholding the right of peaceful dissent. Nixon ignored massive antiwar rallies in Washington and elsewhere in 1969, but after the deaths of students at Kent State University and other colleges in 1970 during clashes with authorities, he sought to broaden his ties with the academic community. As the war came to a close, radical movements declined. Statistics indicated that the use of hard drugs was lessening, but that the administration was making little headway in its fight against crime.
Nixon supported the conservationists on many issues. However, he also favored the development at federal expense of a supersonic transport plane (SST), which he said would maintain America’s supremacy in world aviation. Many persons thought that a fleet of SSTs would harm the environment, and Congress terminated the project.
President Nixon led the nation in honoring American astronauts Neil Armstrong and Edwin Aldrin, who walked on the moon in July 1969.
Despite efforts “to bring us together,” the war contributed in part to the strained relationship between the Nixon administration and the press. Vice President Agnew delivered speeches criticizing the news analysis of some newspapers and television networks. Early in 1971 the president objected to news reports that the U.S.-supported invasion of Laos had not gone well. Later that year, several newspapers published secret documents from an analysis of the Vietnam War prepared at the request of Secretary of Defense Robert McNamara during the Johnson administration. Arguing that some of the revelations in these “Pentagon Papers” were a threat to national security, the Department of Justice tried to halt their publication. The U.S. Supreme Court held, in light of strong constitutional protection of the press, that the government had failed to justify any restraint on publication.
38. President – Gerald Rudolph Ford
Term – August 9, 1974 to January 20, 1977
The new president tried to restore public confidence in the national leadership and in the institutions of government. His administration was one of the most open in years, and Ford sought to emphasize candor in his relationships with the public and the press. But in both domestic and world affairs he inherited problems that did not lend themselves to quick solutions.
In his first year in office, Ford confronted severe economic problems, including both inflation and recession. At first he emphasized the fight against inflation by proposing solutions that reflected his long-standing personal belief in reduced spending, balanced budgets, and tight money.
In early 1975, Ford reluctantly changed his goals to concentrate on relieving recessionary pressures rather than inflationary ones. Unemployment was over 9%, new housing starts were at their lowest point in years, and new car sales were down sharply. Ford urged Congress to cut individual and corporate taxes by $16 billion and to take steps to reduce the national dependence on foreign oil imports. He also called for substantial reductions in spending in order to hold the prospective federal budget deficits as low as possible. He proposed few new spending programs of his own, and in the course of two years in office he vetoed more than 50 pieces of legislation that, in his view, increased spending and undercut the recovery effort. Democrats, who held heavy majorities in both houses of Congress, argued that the nation could stand greater deficits than those proposed and that federal programs to help people were crucial. Congress, however, was able to override only a few of Ford’s vetoes.
By mid-1976 recessionary pressures had eased. Industrial production advanced steadily, making up almost two thirds of the 1973-1975 drop. Nonfarm employment increased by 2.5 million persons, the workweek was lengthened, and the unemployment rate dropped from 8.9% in mid-1975 to 7.8% in late 1976. Unemployment, however, remained high by historical standards. Inflation continued to plague the consumer, but the rate of price increases dropped dramatically.
By late 1976, many of the key economic indicators showed that the economic recovery was slowing down. But administration economic analysts said that such a “pause” was normal.
39. President – James Earl Carter, Jr.
Term – January 20, 1977 to January 20, 1981
On assuming office in 1977, President Carter inherited an economy that was slowly emerging from a recession. He had severely criticized former President Ford for his failures to control inflation and relieve unemployment, but after four years of the Carter presidency, both inflation and unemployment were considerably worse than at the time of his inauguration. The annual inflation rate rose from 4.8% in 1976 to 6.8% in 1977, 9% in 1978, 11% in 1979, and hovered around 12% at the time of the 1980 election campaign. Although Carter had pledged to eliminate federal deficits, the deficit for the fiscal year 1979 totaled $27.7 billion, and that for 1980 was nearly $59 billion. With approximately 8 million people out of work, the unemployment rate had leveled off to a nationwide average of about 7.7% by the time of the election campaign, but it was considerably higher in some industrial states.
Carter also faced a drastic erosion of the value of the U.S. dollar in the international money markets, and many analysts blamed the decline on a large and persistent trade deficit, much of it a result of U.S. dependence on foreign oil. The president warned that Americans were wasting too much energy, that domestic supplies of oil and natural gas were running out, and that foreign supplies of petroleum were subject to embargoes by the producing nations, principally by members of the Organization of Petroleum Exporting Countries (OPEC). In mid-1979, in the wake of widespread shortages of gasoline, Carter advanced a long-term program designed to solve the energy problem. He proposed a limit on imported oil, gradual price decontrol on domestically produced oil, a stringent program of conservation, and development of alternative sources of energy such as solar, nuclear, and geothermal power, oil and gas from shale and coal, and synthetic fuels. In what was probably his most significant domestic legislative accomplishment, he was able to get a significant portion of his energy program through Congress.
Other domestic accomplishments included approval of the Carter plan to overhaul the civil-service system, making it easier to fire incompetents; creation of new departments of education and energy; deregulation of the airlines to stimulate competition and lower fares; and environmental efforts that included passage of a law preserving vast wilderness areas of Alaska.
Carter was not successful in gaining support for his national health-insurance bill or his proposals for welfare reform and controls on hospital costs. He was unsuccessful also in gaining congressional approval of plans to consolidate natural-resource agencies within the Department of the Interior and expanded economic development units in the Department of Housing and Urban Development. Also, Congress did not favorably receive his tax-reform proposals.
40. President – Ronald Wilson Reagan
Term – January 20, 1981 to January 20, 1989
Reagan’s first term was dominated by efforts to carry out his economic program–dubbed “Reaganomics” by the media–which consisted in part of large budget reductions in domestic programs and substantial tax cuts for individuals and businesses. The theory of supply-side economics–generating growth by stimulating a greater supply of goods and services, thereby increasing jobs–was a mainstay of the Reagan approach. Central to the administration’s efforts to combat inflation was rigorous control over government spending deficits. Early budget cuts of $39 billion were followed by the passage of a 25% tax cut for individual taxpayers and faster tax write-offs for business.
The administration’s economic policies had mixed results. Unemployment rose to a level of 10.6% by the end of 1982 but declined to around 5.5% late in 1988. Inflation, which had peaked at 13.5% during the Carter years, gradually fell to about 4%-6%. Massive federal deficits piled up, however–a reflection of taxes cutting, greater defense spending, and other economic factors.
The greatest shock to the economy occurred on Oct. 19, 1987, when the stock market plunged 508 points on the Dow Jones average, ending a slide that had begun in August. In two months stocks had lost about 36% of their value, but within a year they recovered almost half of the loss with little apparent damage to the economy.
In other domestic areas, Reagan achieved mixed results. Deregulation became a watchword of the administration, but critics charged that reduced regulation created hazards to public health and safety. During his first term, the president sought to shift dozens of federal programs to the state and local levels under his system of “new federalism.” Officials in these jurisdictions complained that promised federal aid to implement the programs was inadequate. The administration’s efforts to reduce spending for social programs and increase appropriations for defense engendered controversy.
Reagan’s domestic program during his second term focused on tax reform. Late in 1986 the Senate joined the House to pass a major tax bill that reduced the number of tax rates, removed millions of low-income persons from the tax rolls, and eliminated most deductions.
One focus of the administration from the beginning was an agenda of social issues ranging from opposition to abortion to support for mandatory prayer in the public schools. The executive branch adopted much of the social agenda of the conservative fundamentalist supporters of the president, but Reagan had little success in gaining its acceptance by Congress.
Late in 1987, Reagan failed twice to fill a Supreme Court vacancy with judge’s holdingstrong conservative views. The Senate, 58-42, rejected the nomination of Robert Bork after the Judiciary Committee found him insufficiently inclined to protect individual rights and liberties. A second judge, Douglas Ginsburg, withdrew from consideration after it became known that he had smoked marijuana while teaching at Harvard. Reagan’s third choice for the vacancy, Judge Anthony M. Kennedy, was approved.
41. President – George Herbert Walker Bush
Term – January 20, 1989 to January 20, 1993
Inaugurated as president on Jan. 20, 1989, Bush brought an informal atmosphere to the White House. The Bushes greeted tourists on his first full day as president.
In June 1990 Bush abandoned his “Read my lips. No new taxes” campaign pledge and acknowledged that new or increased taxes were necessary. Many Republican conservatives were critical of this shift, and his popularity ratings fell immediately. The House, with many Republicans in opposition killed a compromise deficit-reduction plan. As a result, the government was almost forced to shut down for lack of money while a new budget proposal was drafted.
In the final days of the 101st Congress the president and Congress reached a compromise on a budget package that increased the marginal tax rate and phased out exemptions for high-income taxpayers. Despite his repeated demands for a reduction in the capital gains tax, Bush had to surrender on this issue as well. This agreement with the Democratic leadership in Congress was a turning point in the Bush presidency. His popularity among Republicans never fully recovered, and the compromise plan reduced the size of the deficit only marginally, despite Bush’s claim that it was the toughest deficit reduction package ever approved.
As the unemployment rate edged upward in 1991, Bush signed a bill providing additional benefits for unemployed workers. He aggressively sought to create new jobs through increases in exports, and to that end he visited Australia, Singapore, South Korea, and Japan in January 1992. Despite hopes for a major agreement with Japan, he obtained only modest Japanese concessions to purchase American products.
Bush’s 1992 State of the Union address offered a plan for economic growth that called for a moratorium on new government regulations on business, a cut in the capital gains tax, and the elimination of numerous domestic programs he deemed undeserving of federal funding. He also endorsed a health-insurance tax credit for poor families and a tax credit for first-time homebuyers. Congress adopted some of his proposals, but Bush vetoed the final bill because it raised taxes on the wealthy. By late 1992 he had cast 35 vetoes, none of which was overridden. The streak ended in October 1992 when Congress, urged on by consumers, overrode his veto of a bill that reversed portions of a law barring local governments from regulating cable-television fees.
In 1992 interest rates and the inflation rate were the lowest in years, but by midyear the unemployment rate reached 7.8%, the highest since 1984. In September the Census Bureau reported that 14.2% of all Americans lived in poverty, the highest proportion since 1983.
As his administration seemed to drift in the face of declining economic conditions, Bush shook up his White House staff twice. His first chief of staff, John Sununu, a former governor of New Hampshire, stepped aside in 1991 and was succeeded by Samuel Skinner, the secretary of trans portation. Skinner, in turn, bowed out in 1992 and was succeeded by Secretary of State James A. Baker, 3d, who also assumed overall supervision of Bush’s reelection campaign.
In 1990, when the president had his first opportunity to fill a Supreme Court vacancy, he nominated an obscure federal judge from New Hampshire, David H. Souter, who was easily confirmed. In 1991, following the retirement of Thurgood Marshall, the only black on the Supreme Court, Bush nominated another black, Clarence Thomas, a federal court of appeals judge with strong conservative views. Some women’s and civil rights organizations opposed the nomination. Bush characteristically remained steadfast in his support, even after a former member of Thomas’s staff, law professor Anita Hill, accused the judge of sexual harassment in nationally televised hearings. Thomas was confirmed, 52-48.
42. President – William Jefferson Clinton
Term – January 20, 1993 to Present
After 12 years of Republican control of the presidency, Clinton came to office amid high expectations for fundamental policy change. Early in his administration he reversed a number of Republican policies. He ended the federal prohibition on the use of fetal tissue for medical research, repealed rules restricting abortion counseling in federally funded health clinics, and used his appointment power to fulfill a promise to place many women and minorities in prominent government positions.
The failure to enact comprehensive health-care reform proved to be a major setback for Clinton. Widespread public concerns over the proposal’s complexity, its reliance on government administration, employer mandates, and levels of services, combined with an effective lobbying campaign by opponents, drained congressional support for this major policy initiative, which had been one of the cornerstones of Clinton’s campaign.
During his first term Clinton succeeded in appointing two members to the U.S. Supreme Court. Ruth Bader Ginsburg and Stephen G. Breyer, both highly respected federal judges, were the first appointments to the high court made by a Democratic president in 25 years.
The president was not able to deliver a Democratic majority back to Congress, but he developed a deft touch at leading a divided government. In 1997 Congress enacted a major tax cut, the first since 1981, and Clinton negotiated a deficit-reduction package that projected a balanced federal budget in 2002. He also had success with a number of targeted domestic programs on education, health, and the environment; won an increase in the minimum wage; and sponsored a welfare reform bill that established time limits for benefits. He claimed credit for the general health of the economy, for a 30-year low in unemployment, and for the fastest real-wage growth in 20 years. The 1998 fiscal year ended with a federal budget surplus of $70 billion, the first surplus in a generation.