U.S. History II
Lecture 14: Chapter 31, The Reagan Years

Jimmy Carter’s failure to rescue the hostages from the American Embassy in Tehran, Iran became only one of his problems as he sought re-election in 1980. The national unemployment rate stood at 7.5%, the inflation rate at 13.6%, and the prime rate reached 15.5% just prior to the November elections. (The rate would rise to 21.5% in December 1980.)

The Republicans chose Ronald Wilson Reagan as their nominee. A former movie actor and governor of California, Reagan smoothly and confidently connected with American voters with his forceful insistence he could restore national pride and bring America’s economy back from the brink. Reagan once said, “I'm told I can't use the word depression. Well, I'll tell you the definition. A recession is when your neighbor loses his job; depression is when you lose your job. Recovery is when Jimmy Carter loses his.” (wikipedia.org, article on Ronald Reagan) Reagan stung Carter by asking Americans, “are you better off than you were 4 years ago?” The obvious answer was, “no.” Reagan chose his former rival for the nomination, George H.W. Bush, as his running mate. Bush had served as Director of the CIA, diplomat to China, and a Congressman from Texas, bringing extensive experience to the ticket.

In the election, Reagan swept the national vote by winning 44 million votes to Carter’s 35 million and 5.7 million for independent candidate John Anderson. Reagan carried 44 of the 50 states in the Electoral College. The Republicans also captured control of the Senate.

Reagan won in part because he connected with conservative voters, including Christian Evangelical voters incensed at the Roe v. Wade decision. Although Carter was an Evangelical himself, his refusal to support conservative values while in the White House alienated his Evangelical base. White Evangelical voters accounted for 66% of Reagan’s lead over Carter. (Source: The Public Eye, available online: http://www.publiceye.org/diamond/sd_polpo.html, last accessed 18 April 2006).

Reagan had promised a tough line on foreign policy, including dealing with the Iranians holding the American hostages. Only 20 minutes after Reagan finished his inaugural address, the Iranians released the hostages from Tehran. Carter’s negotiator achieved the promise of the release, but Reagan was able to announce to the American people that the hostages had left Iranian airspace shortly after his inauguration..

Reagan’s goals as President were simple: “balance the budget, reduce tax rates, and restore our defenses.” Reagan believed he could achieve these goals simultaneously. Reagan assembled an excellent team of advisors, including Texas politician James Baker as his chief of staff. Baker had served Bush on his campaign team prior to his selection as chief of staff. Reagan’s advisors also included Michael Deaver as the media genius and Edwin Meese as attorney general. Initially, Reagan chose former general Alexander Haig as his secretary of state and Caspar Weinberger as Secretary of Defense. These men were given the tasks of fulfilling Reagan’s goals.

Reagan’s presidency suffered an immediate crisis on 30 March 1981, only 2 months after his inauguration. As Reagan left the Washington Hilton Hotel, an insane man named John Hinkley, Jr. opened fire on Reagan. Reagan’s press secretary, James Brady, suffered permanent brain damage in the attempt. Reagan was hit by a bullet as Secret Service officers shoved him into his limousine. Although Reagan came close to dying, he was still able to joke with the surgeons, “I hope you are all Republicans.” Reagan’s upbeat spirit lifted the nation during his recovery.

Unfortunately, Reagan’s assassination led to a serious gaffe by one of his advisors. Since Vice-President Bush was out of town at the time, Secretary of State Alexander Haig told reporters, “I am in control here in the White House.” Regardless of his intention, the press derided Haig’s statement as a usurpation of power. Haig would resign in July 1982 after several clashes with Secretary of Defense Caspar Weinberger.

Hinkley’s actions led to other consequences as well. The nation was outraged when Hinkley was judged innocent by reason of insanity. According to most of the public, Hinkley deserved more punishment than incarceration in a mental institution. Many states toughened laws against criminal insanity pleas.

Reagan brought a conservative distrust of federal government to Washington with him. In Reagan’s eyes, the federal government was a large part of America’s problem. Reagan sought to shrink the government and return control to the people. To do this, Reagan pushed spending cuts and a tax cut. Republicans in Congress joined with “Boll Weevil Democrats” from the South and West to cut taxes by 25% over 3 years.

Although Reagan wanted a smaller federal government, his philosophy called for a greatly enhanced military capability. The American military had stagnated since the Vietnam War. Reagan called for increased military spending, including the capability of supporting a 600-ship Navy. By 1990, the U.S. Navy would sail over 100 submarines and 15 carrier battle groups.

Reagan also refused to touch the social “safety net” established in decades past. Social Security, Medicare, veterans’ benefits, Head Start, and school lunch programs were left intact.

The combination of increased military spending, little decrease in federal spending, and tax cuts caused huge budget deficits during Reagan’s presidency. Reagan’s detractors criticized his economic policies as “Reaganomics,” especially since it relied on what was known as “trickle-down” economics: Give tax cuts to the wealthy so they would invest more in businesses, who would hire more workers. However, the tax cuts led to increased economic growth, giving the government nearly double the tax revenue it had enjoyed in 1980.

In the summer of 1981, the Professional Air Traffic Controllers Organization (PATCO) went on strike against the government. Reagan had warned PATCO that their strike would be illegal. When PATCO refused to call off the strike, Reagan fired 11,359 air traffic controllers and permanently banned them from federal service. Reagan’s actions signaled a change in the government’s dealings with organized labor.

Reagan supported deregulating the economy as much as possible. As part of this deregulation, the Savings and Loan (S&L) institutions around the nation were allowed to participate in commercial real estate loans and other dubious ventures, whereas before they had been limited to investing only in personal real estate. S&L’s needed more lucrative investments as depositors moved their assets into new, higher-yield money-market funds. This proved a risky business. When regulators tried to rein in the speculative ventures, the S&L industry collapsed. The government paid out over $125 billion in claims to depositors to prevent a collapse of the nation’s banking system.

Social Security faced a funding crisis in the early 1980’s. The Nixon administration and Congress had introduced cost-of-living adjustments (COLAs) that raised benefits for Social Security recipients as the rate of inflation rose. After the runaway inflation of the Carter presidency, the system faced serious funding issues. Reagan appointed a committee headed by Alan Greenspan that recommended raising payroll taxes, and taxed benefits on recipients with high incomes. This compromise — Reagan had initially proposed cutting benefits for retirees who began their benefits at age 62 — extended the solvency of the system.

The economy in Reagan’s first term continued to suffer from Carter’s policies, but the economy rebounded in 1983 and continued growing throughout the rest of his presidency. When Reagan took office, the prime rate stood at 20%. When Reagan left office in 1988, the prime rate had dropped to 10.5%.

Foreign Policy

Reagan believed fervently in the supremacy of democracy and capitalism over Communism. Reagan favored a tough line on foreign policy, including dealing with the Soviet Union. Unlike Carter, who asssumed the presidency convinced the U.S. could not win the Cold War, Reagan had every intention of bringing the Soviet Union to its knees. In a speech in 1983, Reagan referred to the USSR as an “evil empire.” Liberals were apoplectic, but the phrase resounded with the public. Reagan gained more support with his quoting of a Russian proverb in arms control talks with the Soviets: “trust, but verify.” In spite of his hard line, Reagan resumed grain shipments to the USSR, to the delight of farmers.

Reagan had a chance to demonstrate his toughness in October 1983. The Caribbean island of Grenada fell in a Communist coup, and it looked as if the Cubans and Russians would add another island to their list of allies in the Western Hemisphere (along with the Nicaraguan Sandinistas). Reagan responded on 25 October by sending the Armed Forces to invade Grenada and overthrow the Communist government.

In March 1983, Reagan announced planed to develop the Strategic Defense Initiative (SDI), a space shield that would protect the U.S. from Soviet ICBM’s. The liberals, intent on supporting detente and arms control, denounced the plan and called it “Star Wars,” saying it would never work. These people missed the point: the Soviets couldn’t afford to duplicate it. Reagan had cut off shipments of high-technology goods to the Communist nations anyway, leaving the Soviets to resort to espionage to acquire American computers and other equipment.

Meanwhile, Reagan and his advisors supported a rebellion in Nicaragua to overthrow the Sandinistas. The rebels, called the “Contras,” received wide support in the adminstration, but the Democratic-controlled House blocked funding for the Contras in 1982.

Elsewhere in Central America, Communist groups fought to overthrow the governments of Honduras and El Salvador. Reagan supported both governments, but the conflict in El Salvador turned brutal as right-wing paramilitary groups assassinated leftist politicians and supporters, including Catholic archbishop Oscar Romero. Romero actively denounced the illegal assassinations; he was killed while participating in Mass.

Reagan’s Central American policy would lead to problems later in his presidency.

The 1984 Election

Reagan was so popular in 1984 that the Democrats had a serious problem of finding someone to run against him. Walter Mondale, Jimmy Carter’s Vice President, was the front-runner in primary elections. However, Mondale faced serious opposition from Jesse Jackson, a civil rights proponent, and Gary Hart, a Colorado Senator. Mondale survived to win the nomination, but in his acceptance speech, he declared, “Mr. Reagan will raise taxes, and so will I. He won't tell you. I just did.” Even his choice of Geraldine Ferraro as the first woman on a major party ticket could not help Mondale recover from such mistakes.

In the first presidential debate, Reagan seemed somewhat out of touch. However, Reagan stormed back to win the next debates. Reagan, who was 73 at the time, said of Mondale, “I will not make age an issue of this campaign. I am not going to exploit, for political purposes, my opponent's youth and inexperience.” (Mondale was 56 at the time.)

Reagan never lost momentum. The American athletes swept the 1984 Summer Olympic Games in Los Angeles; the U.S. celebrated the 40th anniversary of D-Day, and Reagan was there. The result was a landslide. Mondale and Ferraro carried only his home state of Minnesota and the District of Columbia. Republicans also retained control of the Senate.

The 1980’s and Society

American society experienced several major upheavals during the 1980’s.

First of all, the technological revolution exploded onto the scene with the introduction of the IBM PC, using an operating system written by Bill Gates and Paul Allen of Microsoft. Steve Jobs and Steve Wozniak had introduced the Apple II in 1977. Software programmer Dan Bricklin developed the first spreadsheet program, Visicalc, for the Apple II. The spreadsheet program that really transformed business practices was Lotus 1-2-3 on DOS. Then, in 1984, Apple Computer introduced the Macintosh, with a mouse and Graphical User Interface (GUI). Microsoft countered with Windows, its own GUI software that sat on top of DOS.

The Internet gained speed in the 1980’s with the first TCP/IP network in 1983. This network served the National Science Foundation. By the end of the decade, computers would more frequently operate on networks with other computers than as stand-alone machines.

NASA launched the space shuttle in 1981 when the Columbia was launched from the Kennedy Space Center. Over the next few years, shuttle flights became almost routine. The program suffered a crippling blow on 28 January 1986 when the shuttle Challenger exploded 73 seconds after liftoff. The Challenger’s crew included Christa McAuliffe, a school teacher from New Hampshire that had won a competition to join the crew. Reagan’s gift for communication proved crucial during the period of nationwide mourning. As only he could state it, Reagan said, “We will never forget them, nor the last time we saw them, this morning, as they prepared for their journey and waved good-bye and ‘slipped the surly bonds of earth’ to ‘touch the face of God.’” (quotations from the poem “Hight Flight” by John Gillespie Magee, Jr.)

1981 saw the introduction of MTV to cable television, featuring around-the-clock music videos. An entrepreneur named Ted Turner launched the Cable News Network in 1980, featuring around-the-clock news. Neither network had any competition at first.

Socially, single-parent families increased dramatically in the decade, from 3.8 million in 1970 to 10.5 million by 1992. Even worse, more than 60% of black families were single-parent families by the end of the decade. The increase in single-parent families resulted in an increase in the number of children living in poverty in the nation.

The nation also witnessed the birth of a new disease: AIDS. When AIDS was first noticed by medical professionals in Los Angeles in 1981, it was known as GRID (Gay-Related Immuno-deficiency Syndrome). The disease first swept through the homosexual community, but researchers learned that almost half the first victims were not homosexual; therefore, the term AIDS (Aquired Immune Deficiency Syndrome) was introduced. AIDS eventually spread into the general population through drug users sharing needles and through blood transfusions.

AIDS gained a new face when movie actor Rock Hudson died of the disease in October 1985. By the end of the decade, disease had become a major health issue worldwide.

Supreme Court

Reagan appointed 3 Justices to the U.S. Supreme Court. In July 1981, Reagan nominated Sandra Day O’Connor of Arizona to the Court. O’Connor was the first female Supreme Court Justice. In 1986, Chief Justice Warren Burger retired. Reagan appointed Justice William Rehnquist to replace Burger and nominated Antonin Scalia as the first Italian American Justice.

The Democrats re-gained control of the Senate in 1986 elections. In June 1987, Reagan nominated Robert Bork to replace Lewis Powell. The Democrats blocked Bork based on his extensive legal writings, all of which demonstrated his conservative philosophy. Instead, Reagan nominated Anthony Kennedy to the Court.

Reagan’s Second-Term Foreign Policy: Iran Contra

In 1986, Reagan’s foreign policy team thought they had found a way to free terrorist-held hostages in the Middle East and fund the Nicaraguan Contras at the same time. Marine Colonel Oliver North, a member of Reagan’s National Security Council, developed a “neat idea” to sell arms to Iran through Israel in return for American hostages being held in Lebanon by Hezbollah, a terrorist group allied with Iran. In return, the proceeds from the sales would fund the Contras.

Everything worked fine until the Sandinistas shot down a plane running arms to the Contras on 5 October 1986. The pilots were killed, but a cargo worker, Eugene Hasenfus, survived the crash (by wearing an unauthorized parachute). Hasenfus told the Sandinistas everything he knew. News also broke in Lebanon in 1986 of the arms sales.

In the ensuing debate, Reagan claimed to remember nothing about approving the operation. North and his secretary, Fawn Hall, shredded documents. (Hall would later be named a Playboy magazine “Sex Star of 1987.”) National Security Advisor John Poindexter was forced to resign, and Reagan fired North. Reagan appointed a commission under former Senator John Tower of Texas to investigate. When lawmakers granted immunity to several people, special counsel Lawrence Walsh was forced to drop some of his investigations. Reagan accepted the Tower Commission’s findings in 1987.

Communism Falls

As Reagan entered his second term, the Soviet Union was crumbling from the inside, primarily through pressure from American military policy, societal pressure from Poland, and economic pressure within the USSR.

In Poland, labor unrest resulted in the most successful rebellion against the Communists. In 1980, food prices had led to the creation of the Solidarity labor movement, joining more than 120,000 workers across the nation. In August 1980, Solidarity went on strike nationwide. Solidarity grew to more than 10 million members under the leadership of Lech Walesa, a Gdansk shipyard electrician. Solidarity won concessions from the government, but the government was overthrown and replaced with a Communist military dictatorship. Solidarity was officially banned.

The Soviets wanted badly to crack down on Poland, but Poland had the ultimate trump card. In 1978, the Roman Catholic Church had elected Karol Wojtyla, Archbishop of Krakow, as pope. Wojtyla ruled the Church under the name of John Paul II.

John Paul II visited Poland in 1979 on one of his first official visits. While there, John Paul met with General Wojciech Jaruzelski, leader of the military government, and stressed his support of Solidarity. The Soviets didn’t dare invade Poland for fear of instigating a papal trip to his homeland. Instead, the Soviets — through their Bulgarian allies — attempted to assassinate John Paul in May 1981.

Reagan turned up the pressure by installing Pershing II cruise missiles in West Germany in 1984-85. The Russians could not keep up with America’s military spending.

Gorbachev realized the Party could no longer rule the Soviet Union and Eastern Europe as Stalin and Breshnev had done. First, Gorbachev replaced 70% of the Party leadership with new, pro-Western reformers. In the 1986 Party Congress, Gorbachev announced a reform plan based on 2 elements: glasnost (openness), and perestroika (restructuring).

Glasnost targeted the Soviet cultural and political life. Censorship was ended; TV stations were allowed to broadcast accurate news from Afghanistan and abroad. Perestroika was meant to reform political and economic structures, allowing for more democracy and hopefully leader to greater efficiency in the Soviet economy.

Gorbachev announced a unilateral freeze on medium-range nuclear missiles in his first month in office. Gorbachev attempted to persuade Reagan to abandon the “Star Wars” anti-missile shield in return for a 50% reduction in Soviet arms. Reagan refused. Gorbachev offered to eliminate the entire Soviet nuclear arsenal; Reagan held firm, much to Europe’s chagrin. (Thatcher wholeheartedly supported Reagan.) Instead, Reagan visited West Berlin in June 1987. In a stirring speech, Reagan stood in front of the Berlin Wall and challenged, “Mr. Gorbachev, tear down this wall!”

In 1986, Gorbachev’s government freed dissident Sakharov from internal exile. Dissident Anatoly Shcharansky was freed from a Soviet prison and allowed to emigrate to Israel. In 1987, Gorbachev denounced Lenin’s terror. A few months later, Gorbachev announced plans to withdraw all 120,000 soldiers from Afghanistan. In 1987, Gorbachev announced plans to allow multiple-party elections by secret ballot in the Soviet Union.

Gorbachev had one major problem: The pace of change accelerated far quicker than he could handle. Communists hated him for dismantling the Communist state; reformers hated him because he wasn’t going fast enough. One reformer, Boris Yeltsin, was fired from Communist Party head in Moscow for his criticism of Gorbachev.

In December 1988, Gorbachev announced in a speech at the UN that he planned to reduce the Red Army in Eastern Europe by 500,000 men and 10,000 tanks. In October 1989, foreign ministers of the Warsaw Pact renounced the Breshnev Doctrine of intervention to maintain Communist rule in Eastern Europe. On 4 December 1989, Gorbachev would stand with U.S. President George H.W. Bush on the island of Malta and declared the Cold War was ended. Gorbachev won the Nobel Peace Prize in 1990.

Reagan’s Legacy

In spite of the textbook author’s misgivings, Reagan’s presidency lifted the United States above the morass of the 1970’s and the Vietnam War. America emerged from Reagan’s presidency as the world’s sole superpower. His support of anti-Communist groups in Central American and Eastern Europe helped the Free World win the Cold War. Reagan’s Court appointments helped usher a new period of conservative judicial decisions.

In November 1994, Ronald Reagan told the nation he had been diagnosed with Alzheimer’s Disease. In his trademark style, Reagan said in a hand-written note, “I now begin the journey that will lead me into the sunset of my life. I know that for America there will always be a bright dawn ahead. Thank you, my friends. May God always bless you.”

Ronald Reagan died on 5 June 2004 at age 93 and was given a state funeral. Polls consistently find Reagan listed as one of America’s greatest and most popular presidents.