1. Globalization
USHC 8.5

2. USHC 8.5
Summarize key political and economic issues of the last twenty-five years, including continuing dependence on foreign oil; trade agreements and globalization; health and education reforms; increases in economic disparity and recession; tax policy; the national surplus, debt, and deficits; immigration; presidential resignation/impeachment; and the elections of 2000 and 2008.

3. Globalization
Economic issues arising from changes in international trade have intensified the confrontation between conservatives and liberals in the last twenty-five years.
Globalization is the growing trend towards expansion and integration of worldwide trading networks.
The United States is impacted by globalization as its place as the world’s foremost economic power in the post World War II world is challenged by growing economies around the world.

4. Oil
The United States continues to be dependent on foreign oil and therefore the American economy is impacted by fluctuations in world oil prices.
In the 1990s, the European Common Market developed into the European Union (EU) to provide political cooperation as well as promote democracy, trade, and the development of European economies.
A majority of members of the EU adopted a common currency.

5. NAFTA
In the Western Hemisphere, the North American Free Trade Agreement (NAFTA) attempted to increase trade by eliminating trade barriers.
The 1994 General Agreement on Tariffs and Trades (GATT) lowered tariffs around the world.
As a result of this globalization, United States industries are experiencing greater competition and a growing unfavorable balance of trade.
Outsourcing of jobs to foreign markets where labor costs are cheaper has resulted in unemployment for some American workers.

6. The Internet
The tremendous growth in the use of computers, the Internet, E-bay, , pagers, computer games, and cell phones by a large portion of the population brought changes to society, privacy laws, and communication networks in the United States and around the world.
The internet and satellite communication have promoted the outsourcing of some service jobs to places such as India.

7. Mechanization and Globalization
Mechanization and globalization are causing a loss of manufacturing jobs in the United States and a continued shift to jobs in service industries.
Added to this competition for jobs is the influx of immigrants who are willing to work at menial jobs for low wages.
The resulting controversy over immigration policies, especially of Hispanics, impacted politics at the same time that trade policy created political controversy about jobs.

8. Mechanization and Globalization
With a loss of manufacturing jobs, labor unions experienced a decline in membership and influence as their workers faced competition from overseas, new immigrants, further mechanization of the manufacturing process, and an increasingly hostile political climate.
The movement of industries and retirees from the “rustbelt” to the “sunbelt” means a big population shift to the “right-to-work” states that continues to impact the political influence of labor unions.

9. Mechanization and Globalization
Globalization has also raised concerns about how well the American education system is preparing the nation’s children to compete in the global marketplace.
As a result “No Child Left Behind” was passed during the George W. Bush administration.
This federal law mandated that states test students to see if they meet increasingly difficult goals to demonstrate academic proficiency.

10. Mechanization and Globalization
Demographic changes in the United States also significantly affect the economy and politics.
Economic conditions make it increasingly likely that both mothers and fathers have to work to provide for the family.
Demand for services such as day care and fast food, and the resulting impact on the obesity rate and health, are growing.
Medical advances prolong productivity and life for many Americans.
The aging population contributes to the rising cost of health care and of health insurance.

11. Mechanization and Globalization
As workers lose jobs in manufacturing and as companies drop benefits to maintain competitiveness, many Americans are losing their health insurance.
Lack of basic health care increases the burden on hospital emergency rooms and the cost of health care continues to rise.
An attempt to pass health care reform legislation during the Clinton administration met with intense Republican opposition and did not pass.

12. Mechanization and Globalization
Health care legislation was passed by the Democrat controlled Congress during the Obama administration but continues to be politically controversial.
The aging population also contributes to political controversies over the financial burden of Social Security.
Both issues contribute to arguments over the yearly budget deficit and the national debt.

13. Bill Clinton
In the 1980s, yearly budget deficits due in large measure to increased defense spending contributed to an accumulating national debt.
Thus, budget deficits and recession were campaign issues in the early 1990s and contributed to partisan rancor.
Bill Clinton was elected in 1992.
In a concession to critics on the right, Clinton introduced welfare reform legislation that modified decades of policy dating back to the New Deal.
Clinton’s health care reform legislation became a partisan battleground.

14. Bill Clinton
President Clinton and the Republican Congress also fought over how to both balance the budget and stimulate the economy.
Partisan rancor was evident in continuous investigations of the Clintons by a special prosecutor and reached a peak when the Republican–controlled House of Representative impeached President Clinton.
Unlike President Nixon, who tendered his resignation rather than be impeached, President Clinton maintained that he had not engaged in an impeachable offense and was tried by the Senate.

15. Clinton Administration
The Senate refused to convict him and Clinton remained in office.
During the Clinton administration a deficit reduction plan that included a tax increase, spending cuts, and the establishment of the earned income tax credit was passed.
The Federal Reserve kept inflation in check and stimulated the economy by managing interest rates.
Resulting economic growth brought low unemployment; but, the gap between rich and poor continued to widen.

16. Clinton Administration
The national debt lessened as the world experienced the end of the Cold War and the ‘peace dividend.’
When Clinton left office there was a budget surplus and the national debt was shrinking.

17. George W. Bush
The outcome of the election of 2000 remained undecided for several weeks beyond Election Day as Democrats and Republicans contested the counting of ballots in Florida.
Finally, the Supreme Court stopped the recount and Republican candidate George W. Bush won the election.
During the Bush administration, tax cuts for the wealthy designed to stimulate the economy further increased economic disparity and eventually budget deficits.

18. George W. Bush
When the United States became involved in wars in Afghanistan and Iraq in the post 9/11 era, defense spending climbed and the United States again experienced deficit spending and escalating debt.
At the end of the Bush administration, the housing bubble burst and the Bush administration turned to deficit spending to stop the decline.
They initiated a stimulus package and a bail-out for banks to forestall a deepening recession.

19. Barack Obama
The election of 2008 came amid these worsening economic conditions. Barack Obama, an African American, was elected president.
The Obama administration passed a second stimulus package in an effort to jump- start the economy.
Conservative critics objected to deficit spending because it raised the national debt.
However Congress did not repeal the Bush tax cuts for the wealthy to bring in more revenue to help to balance the budget.

20. Barack Obama
Although economists have declared that the Great Recession has ended, lack of confidence in the economy because of political wrangling and the worsening debt crises in Europe continue to dampen consumer spending.
Many Americans remain unemployed, despite low interest rates, and significant cash in the hands of businesses.
Currently deficits and debt continue to grow as does the gap between the rich and the poor.
Conservatives and liberals continue to seem unable to find a compromise solution and the political extremes control the debate.