1. Successes and Failures

2. Reagan’s Second Term 1985-89

3. 1984 Election Mondale (Minnesota)Reagan (California)

4. 1984 Election  Republican –  President – Ronald Reagan  Vice President – George H. W. Bush Democrat - President – Walter Mondale Vice President – Geraldine Ferraro (First woman to run on a Major party’s national ticket!!!!) * Reagan carried 49 out of 50 states!! (lost Minnesota Mondale’s home state)

5. Reagan’s Second Term Domestic Issues  The Growing Federal Debt  Federal Deficit was Hurtling out of control – was expected to go over $2 trillion in 1986 (more than double when Reagan took office)  December 1986 – Congress took Drastic Action  New Balanced Budget and Emergency Deficit Control Act – set budget goals that would reduce the deficit each year until balanced in 1991  But every time the year for a balanced budget approached the day was postponed by congress who feared the impact of cuts

6. Growing Deficit Cont.  Some people this balance attempt “Meat axe” – instead of selecting unnecessary projects to be cut, the law was automatic  If Congress appropriated more than the goals allowed “across the board” cuts came into action and all federal programs were slashed by the same proportion  Only a few exemptions – Social Security and Pensions  This act showed congress was unwilling to take Political Risks to save important programs  Programs were measured only in dollars and not by nation’s need!!!

7. A New Tax Law  Reagan argued a new tax reform was needed to keep the free-enterprise system prosperous  May 1985 - Used his charm and persuasion on TV to call for a sweeping tax reform  Felt forms were too puzzling and a headache  Rates were too High for people with large incomes that it stopped them from opening up new businesses

8. Tax Reform Act of 1986 Did not make the laws any simpler, but did make a big cut in the tax rates! Two basic rates replaced the 14 brackets, and many tax deductions, often called “Loopholes” because of the tax revenue that fell through them were reduced or eliminated New Law was not supposed to increase or decrease the gov’t total revenue. But it was expected that 60% of individual Taxpayers would pay less! Some Corporations complained they would pay more!

9. Foreign Affairs  Soviet Union  March 1985 – Leader Chernenko died  Mikhail S. Gorbachev – succeeded him – 54 yrs old youngest leader of the USSR since Stalin  Many wondered where he would lead the communist world  Agreed to meet with Reagan in Geneva, Switzerland  November 1985 was the first meeting between Soviets and U.S. since 1979  Both men expressed high hopes for better relations between their two countries

10. Foreign Affairs Cont.  Nuclear Disaster  Gorbachev swiftly showed a new style of leadership  Went out and talked to people on the streets and Factories  He was only beginning to get himself into power when a catastrophe shook the entire Soviet Union!  A Nuclear reactor at Chernobyl, exploded in April 1986

11. Foreign Affairs Cont  Effects of Chernobyl  Radioactive waste spewed into air and spread terror across Europe  Radiation released was equal to all the radiation that had ever been released from the explosion tests of bombs throughout the world  31 were killed and several hundred injured  Estimated that anywhere from 17,000 to 475,000 might die from radiation exposure in the next 70 years.

12. Foreign Affairs Cont.  Reykjavik  Reagan and Gorbachev met Oct 11-12 1986 in Reykjavik, Iceland  Most hoped that this meeting would end in a program to lessen nuclear arms  Two leaders talked about abolishing all long range nuclear weapons (our allies in Western Europe were afraid of this proposal, thought these weapons were needed to keep the soviets from conquering westward)

13. Foreign affairs Cont  Reykjavik cont  Meeting ended with no decisions  Gorbachev objected to Reagan's Strategic Defense Initiative (SDI) – a system of advanced defensive weapons called “star wars”  Soviets demanded that for the next 10 yrs. American should test it only in Laboratories  Many Americans believed; and soviets later confessed they were already working on their own SDI. Why let Americans Match it?!?!

14. Foreign Affairs Cont.  The Strategic Defense Initiative (SDI)  Proposed by Reagan 1983 – hoped to build a defensive shield of advanced weapons, some operating in outer space, to make the U.S. safe from Nuclear Attack  Reagan even said he would share technology with Soviets to reassure them  Critics including scientist said it would cost billions and may not even work  Everyone knew Gorbachev wanted to improve standard of living for his people, this meant spending less on weapons; So he had an interest in slowing down the arms race

15.  SDI cont.  If Gorbachev could stop American progress on SDI, the Soviets might be able to cut back on their arms budget  As it turned out, Reagan’s un built SDI proved to be a powerful bargaining chip against the Soviets.

16. Reducing Nuclear Arms  Vienna, Austria  Reagan and Gorbachev meet a third time (Feb 1987)  Gorbachev offered to sign and agreement for eliminating both Soviet and U.S. medium-range missiles (missiles that could not cross the ocean)  Each country could station representatives outside the other country’s plant that manufactured the weapons  Dec 7, 1987 Gorbachev arrived in U.S. – Both leaders signed the new Intermediate-Range Nuclear Forces (INF) Treaty – would remove all missiles with rages of 300 to 3400 miles from Eastern to Western Europe

17. Foreign Affairs Cont  INF cont  For the first time in history – the treaty aimed to reduce the size of nuclear forces  It did not insure peace – both countries still had enough long range missiles and nuclear warheads to destroy each other  Some Americans and American allies believed it left the world less safe because the treaty left Western Europe exposed to the much stronger. Regular armed forces of the Soviet Union  It was a way of testing the willingness of the world’s greatest adversaries to come together  It might have been the first step away from the worlds atomic self-destruction

18. “The Teflon President”  What a witty critic called Reagan  Teflon was a patented new material for pans which never let anything stick to it so it always looked clean  Somehow failures and criticisms never seemed to stick to him  But by the fall of 1986 the Teflon stopped working  The last two years of Reagan’s terms were marked by national tragedy, foreign policy scandal, and economic Shock!!!

19. Challenger  January 28, 1986 – Christa McAuliffe a young school teacher had been selected from many competitors to be the first “citizen observer” to go into space  Only 74 Seconds into flight, millions watching on TV were horrified to see the Shuttle explode  After the Challenger and other series of mishaps in the space program the program was at a standstill until Oct 1987 when it successfully launched another titan 34D ( one crashed in April 1986 supposedly carrying a spy satellite)

20. Arms and Hostages  Oct 1986  Cargo plane carrying supplies to contra rebels in Nicaragua was shot down  Two Crew members killed and Eugene Hasenfus – an American cargo handler captured  Hasenfus told Nicaragua he was working or CIA  U.S denied this confession – Boland Amendment had banned military aid to the contras  Many did not believe this denial  Nov 3 a Lebanese magazine reported that Reagans former National Security Advisor had visited Iran to arrange arms shipments!!

21. Arms and Hostages cont  Presidents could not support this story!!  U.S had been trying to stop other countries from supplying arms to Iran  The President admitted that for 18 months the U.S had been dealing with Iran  Four Reasons:  To renew friendly relations with Iran  To try to end a long war between Iran and Iraq  To end Terrorism by Iran  To bring the American Hostage held in Lebanon home safely

22. Arms and Hostages Cont  Two weeks later…  President confessed that he had “Not been fully informed” about the Iran Policy  An investigation by the Attorney General disclosed that millions of dollars from the Iranian arms deals had been diverted to Nicaraguan contras  Also said National Security Advisor, Admiral John Poindexter, and an aide, Lietenant Colonel Oliver North, will be dismissed from the White House

23. “Iranscam” The Iran-contra affair  Reagan hired former Senator of Texas John Tower to untangle to story  Analysis made it clear arms were sold to Iran in 1985- 86 with the understanding that American hostages would be released  Money received from Iran was hidden in a secret bank account then used by a mysterious organization called “The enterprise” – was outside the law!! Was to aid the contras and support other covert activities – owned a ship, warehouse, airplanes, and a whole airfield!  “The Enterprise” – headed by Oliver North - Admiral Poindexter and William Casey – Director of CIA had known and approved the secret organization

24. The Crash of 1987  One of the most unpleasant domestic Surprises of the decade came in Oct 1987  Stock Market began to slowly go down  After the Gov’t reported a trade deficit of 1.5 billion higher than expected the Dow Jones fell 95 points!!  Few days later as word spread throughout world 508 points!!  In just one day stocks lost 20% of market value – worst in American History

25. End of the Reagan years  As Reagan approached the end of his admin….  Events abroad created problems that the next president would have to face!!  6 foreign problems to face  Troubles with Persian Gulf  Palestinian Revolt  Afghanistan  Nicaragua  China  South Africa

26. Troubles in Persian Gulf  War Between Iran and Iraq dragged on  1987 – attacked increased on tankers carrying oil to Europe, Japan and U.S.  As shipped came through Persian Gulf they were subject to attack on either side  May 17 – Iraqi planed mistook a U.S. Frigate as an enemy ship – killed 37 crew members  Officers of U.S. ship considered Iraqis to be friendly they did not prepare for defense

27. Persian Gulf Cont.  July 1988 – USS Vincennes mistook an Iranian civilian plane for an attacking Iranian fighter and shot it down – 290 people died  Iran declared it would “avenge the blood of our martyrs”  December 1988- American Airline 103 exploded over Scotland – 259 people aboard 11 ground crew killed  Many indications that the Iranians ordered the bombing!

28. Palestinian Revolt  Iran-Iraq war and events in Persian Gulf took eyes away from Israel and the problems of the Palestinians  News caught Palestinians protesting on the streets attacking Israeli soldiers with stones  Israeli troops responded with firing – daily young Palestinians died  Palestinian problem was not going to go away until they had their own homeland!

29. Afghanistan  1979 – began the war in Afghanistan when the Soviet Union sent in troops to support Communist gov’t which was facing guerilla opposition  Soviets found themselves mired in their own Vietnam  The rebels with weapons supplied mainly by the U.S., Saudi Arabia, and China were able to control most of the country outside the main cities  April 14, 19880 Soviets seemed to admit that the cost of the conflict was too great when they agreed to remove their troops  After 1 million ppl died in the fighting they were allowed to settle their own affairs  But the Communist gov’t held onto power, and the war went on!

30. Nicaragua  Feb 1987 – President of Costa Rica – Oscar Arias Sanchez proposed a peace plan – which was awarded a Nobel Peace Price for  Presidents of Costa Rica, Guatemala, El Salvador, Honduras, and Nicaragua signed an accord in August  Plan called for an end of all outside aid to guerilla groups, for restoration of freedom of press and political activity, and for free elections

31. Nicaragua cont  1990 – Nicaragua finally opened elections – Violeta Barrios elected President  First democratic change in nations history  Sandinista’s who were leading the revolt were still making it hard for her to rule  Nicaragua’s population was exploding, economies were troubled - there problems became the whole worlds with their large foreign debts that could not be paid began to endanger the worlds banking system!

32. China  Mae Zedong – died 1976  Deng Xiaoping – took reigns  Seemed more concerned with stimulating China’s economic life, he moved away from the strict Marxist-Leninsim and tried free enterprise  Trade Between U.S. and china increased

33. Election of 1988  Republican  President- George Bush – Texas – electoral vote 426  Vice – Dan Quayle – Indiana  Democrat  President – Michael Dukakis – Gov Massachusetts- electoral votes 111  Vice – Lloyd Bentsen – Senator Texas

34. Polls…