Chapter 19
In This Chapter
● Wading through Watergate
● Fueling a failing economy
● Smiling for the camera — and the country
● Thawing after the Cold War
Nothing puts a damper on a country’s attitude like a crooked president followed by a couple of well-meaning but relatively inept ones, and that’s just what occurred in the 1970s. Throw in an oil crisis, a very unsettled economy, and a hostage situation in Iran, and we’re not exactly talking about the Golden Age of America here.
In this era, a charismatic figure from, of all places, Hollywood, rides to the rescue, smiles a lot, and generally makes America feel better about itself by the end of the 1980s.
Wearing Nixon's Shoes
No one voted for Vice President Gerald R. Ford when he became president of the United States on August 8, 1974. Come to think of it, no one had voted for him when he became vice president, either.
Ford was elected to Congress from Michigan in 1948, and reelected every two years through 1972. In December 1973, President Nixon appointed Ford vice president after the incumbent vice president, Spiro T. Agnew, resigned. Agnew was a blustering eccentric who proved to be an even bigger crook than Nixon. Finding himself under investigation for extorting bribes from contractors while he was governor of Maryland, Agnew pleaded no contest to a charge of tax fraud, quit the vice presidency, and faded into richly deserved obscurity.
Not on my shift
"I did not take the sacred oath of office to preside over the decline and fall of the United States of America."
— Gerald R. Ford, after assuming the presidency, August 1974.
A month after becoming president when Nixon resigned in the wake of the Watergate scandal, Ford determined the country needed to put Watergate behind it. The best way to do that, Ford decided, was to pardon Nixon for any crimes he may have committed while in office. About 40 of Nixon’s assistants weren’t so lucky and were indicted for various offenses. Some of them, including Nixon’s attorney general, John Mitchell, and Nixon’s top aides, John Ehrlichman and John Haldeman, went to prison.
Doing the best he could
As an honest, hard-working, and amiable man, Ford did his best as president. Unfortunately, his best wasn’t great. Although he had been a college football star and a leader in Congress, he developed an undeserved reputation as a not-too-coordinated, not-too-bright guy. Falling down a flight of airplane stairs, hitting a spectator with a ball during a golf tournament, and occasionally misspeaking didn’t help. Lyndon Johnson joked that Ford had “played one too many games without his helmet.”
Ford’s pardon of Nixon angered many Americans who felt the former president should not have escaped facing the justice system. But even without the Watergate hangover, 1975 wasn’t a great time to be president, for Ford or anyone.
In late April 1975, the communists completed their takeover in Vietnam. American diplomats scrambled onto escape helicopters from the roofs of buildings near the U.S. Embassy in Saigon, with the whole world watching from living room televisions. Most of the rest of Indochina had already fallen under communist control or fell soon after.
Whipping inflation
Even worse for Ford than the humiliation of the fall of Saigon, the U.S. economy was a mess. Inflation was soaring and the unemployment rate reached 9 percent, the highest level since 1941. Ford’s response included asking Americans to wear buttons that bore the acronym “WIN,” for “whip inflation now.” The buttons didn’t have much of an impact, however.
Despite the buttons’ ineffectiveness, Ford refused to take stronger measures. He neglected to address such issues as wage and price controls and did little to lessen the country’s growing dependence on foreign oil. So when oil-producing nations, mainly in the Middle East, dramatically jacked up oil prices — 400 percent in 1974 alone — the United States suffered a price increase on just about every other product as well.
The Nixon pardon, the humiliating end to Vietnam, and the staggering economy proved to be three strikes against Ford. After barely winning the Republican nomination over former California Gov. Ronald Reagan, Ford lost the 1976 presidential election to Jimmy Carter, the former governor of Georgia. The way things turned out, Ford may have been the lucky one.
Good Intentions, Bad Results
America turned 200 in 1976, and for its bicentennial birthday, it gave itself a new president. His name was James Earl Carter, but everyone called him Jimmy. He was a Naval Academy graduate, a nuclear engineer, a peanut farmer, and the former governor of Georgia. He ran for the presidency as a Washington outsider. Because U.S. voters were pretty sick of Washington insiders, they elected him in a close race over the incumbent, Jerry Ford. Carter was the first candidate since 1932 to defeat an incumbent president. He was also the first president from the Deep South since the Civil War.
Ford had started his administration with the controversial pardoning of Richard Nixon, and Carter started his with the controversial pardoning of Vietnam War draft evaders. There were other similarities. Both men seemed to have a tough time being consistent in their policy-and decision-making. And both had real troubles with the economy because of runaway inflation and oil shortages.
Measuring misery
During the 1976 campaign, Carter added up the nation’s unemployment rate and inflation level, called it a “misery index” and used it as an effective rhetorical weapon against Ford. Unfortunately for Carter, by the time he left office, the level of misery was higher than when he took over. The annual inflation rate — the change in the price of various consumer goods — went from 5 percent in 1970 to 14.5 percent in 1980. The price of gasoline went from about 40 cents a gallon to more than 70 cents. Part of the reason for both higher inflation and high oil prices was America’s increasing dependence on foreign oil. Simply put, the country was using more oil — for everything from running cars to making textiles — than it was producing.
A nuclear "oops"
One of the great hopes of weaning America from its dependence on foreign oil was nuclear power from plants like the one on the banks of the Susquehanna River in a bucolic area of Pennsylvania called Three-Mile Island.
On March 28, 1979, one of the plant's thousands of valves went on the fritz. The malfunction caused temperatures in the plant's reactor chamber to climb to 5,000 degrees Fahrenheit, melting the lining of the reactor chamber before being stopped by the thick concrete floor.
Pregnant women and children were evacuated and as many as 60,000 other people voluntarily fled the area. As it turned out, only relatively low levels of radiation escaped and no claims of personal or property damage were ever proven.
But the accident effectively exploded the hopes of expanding nuclear power as an energy source in America. Although 104 nuclear plants were still operating in the United States in 2008, supplying 20 percent of the country's energy, no new plants had been built since the Three-Mile Island accident.
In the early 1970s, Arab oil-producing countries cut off supplies to the United States and other Western nations as a way of pressuring Israel to give back Arab territory it had taken during a 1967 war. When the embargo was lifted in 1974, the Western countries’ oil reserves had dried up and the oil-producing countries could charge pretty much whatever they wanted for their product.
Higher oil prices helped fuel inflation, and inflation helped trigger higher interest rates. Companies couldn’t afford to borrow money to expand, so unemployment rose. Carter tried various ways to combat the problems, including voluntary wage and price controls, but they didn’t help much. Things got so bad that Carter went on national television to acknowledge that a “crisis of confidence” had struck the nation. The address became known as “the malaise speech,” and to many people it made Carter appear to be a self-pitying crybaby.
Befriending the enemy
On the foreign front, Carter had mixed results. He negotiated treaties to gradually transfer the Panama Canal territory to Panama. He reached an agreement with the Soviet Union to restrict the development of nuclear arms, and furthered the restoration of relations with Communist China, which had been started by President Nixon.
Jesse Jackson
He could've been a professional athlete but became a preacher instead — and as a result became known as "the president of Black America."
Jackson was born in 1941, the illegitimate son of a South Carolina cotton buyer who ignored Jackson for much of his early life. After a career as an all-state football player in high school, Jackson passed up a pro baseball contract and went to college instead. He also became active in the civil rights movement, and was with Martin Luther King Jr. when King was assassinated in Memphis in 1968. In that same year, Jackson was ordained a Baptist minister.
Basing his work in Chicago, Jackson founded a program in 1971 called Operation PUSH (People United to Save Humanity). The program was designed to address problems facing inner-city youth. In 1984, he formed the National Rainbow Coalition, the aim of which was to bring together members of all races to address common goals. Jackson also ran for president in 1984 and 1988, generating enough support to become a major player in national Democratic Party politics. He has also been something of a diplomat-without-a-portfolio, negotiating the release of hostages in Syria, Cuba, and Iraq.
Controversial, charismatic, and a gifted speaker, Jackson has been an inspirational — if sometimes divisive — advocate for human rights and a bridge between grassroots organizations and traditional U.S. party politics.
Carter’s biggest triumph was in engineering a historic peace agreement between Israel and Egypt, which had been at each other’s throats for decades. At Camp David, the presidential retreat in Maryland, Carter brokered a deal in 1978 with Israeli Prime Minister Menachim Begin and Egyptian President Anwar Sadat. Sadat and Begin got the Nobel Peace Prize for their efforts; Carter got nothing but trouble in the form of multiple disasters involving Iran.
The United States had backed the shah of Iran since 1953, when the Central Intelligence Agency (CIA) helped him regain power in that country. When the shah was thrown out again in 1979 and replaced with a Muslim religious leader named the Ayatollah Ruhollah Khomeini, the United States allowed the shah to receive medical treatment in the United States.
That angered Iranian mobs, which invaded the U.S. Embassy in the Iranian capital of Teheran on November 4, 1979. The mobs held the occupants of the Embassy hostage. Some hostages were allowed to leave, but 52 were kept as prisoners. In April 1980, Carter ordered a team of Marine commandos to Iran on a rescue mission. Because of a series of screwups and accidents involving the rescue aircraft, eight commandos were killed before the actual rescue even began, and the mission was called off.
Finally, after the shah died in July, negotiations for the hostages’ release began. They ended with the hostages being freed on January 20, 1981, after 444 days in captivity. The day the hostages were freed was, coincidently, the last day of Carter’s presidency.
There’s a First Time for Everything
If you told someone in 1951 that Ronald Reagan would someday be president of the United States, he would’ve suggested you check into a rest home for the politically delusional. After all, the veteran actor had just starred in Bedtime for Bonzo, in which his co-star was a chimpanzee. That qualified him for Congress, certainly, but hardly the White House.
In addition to being the first president to have starred in a movie with an ape, Reagan was also the first president to have been divorced, and at the age of 69, the oldest president when he took office. Reagan was born in Illinois in 1911 and after college became a sportscaster in Iowa. In 1937, a screen test led to Hollywood, and Reagan became a second-tier star, first in movies and then in television. His taste for politics grew from serving two terms as president of the Screen Actors Guild, and as his politics became increasingly conservative, he found himself a favorite of the Republican Party’s right wing. He ran for governor of California in 1966, defeating incumbent Pat Brown, and served two terms.
In 1976, he came in a strong second for the GOP presidential nomination, and then in 1980, swept both the nomination and the presidency over the unpopular Carter. His two greatest campaign tactics turned out to be a single question — “Ask yourself, are you better off than you were four years ago?” — and not being Jimmy Carter.
As president, Reagan was essentially a cheerleader for a vision of America that counted on everyone trying not to be too different and not relying on government to do much about anything. He seemed to have an inexhaustible supply of both good and bad luck. He bounced back from being shot and seriously wounded after giving a speech at a Washington hotel in 1981, and in 1985 he won a bout with cancer. Despite his health problems, he managed an easy reelection victory in 1984 over Democrat Walter Mondale, who had been vice president under Jimmy Carter.
Reagan greeted political setbacks with boundless good cheer and a joke or two. And no matter what else happened, Reagan’s personal popularity stayed high — so much so that he became known as the “Teflon president”: Like the non-stick coating used on pots and pans, nothing seemed to stick to him. But his nice-guy persona didn’t mean he was wishy-washy. When the country’s air traffic controllers ignored federal law and went on strike in 1981, Reagan fired all 11,400 of them and refused to rehire them after the strike ended.
Death in the jungle
He was handsome, charismatic, and a mesmerizing speaker. He was also crazier than an outhouse rat. But to his followers, the Rev. Jim Jones was a messiah, the man who would show them the path to interracial happiness and a utopia on earth.
Jones, an Indiana native who once sold monkeys door to door (seriously), became a preacher and eventually settled his "Peoples Temple" in San Francisco. By the mid-1970s, he had as many as 5,000 followers and wielded considerable political clout. But negative news stories about some of the temple's shady dealings triggered interest by various government agencies. In 1977, Jones left the Bay Area for a settlement in the jungles of Guyana, in South America, that some of his followers had started several years before. It was called Jonestown.
In November 1978, a California congressman named Leo Ryan, some aides, and a few reporters visited Jonestown to investigate allegations of mistreatment of some of the residents, who were mostly African American (Jones wasn't). After a tense meeting with Jones, Ryan's party was attacked at a nearby airfield. Ryan and four others were killed. After the attack, Jones ordered his followers to commit suicide by drinking or injecting poison. Those who refused were slain. In the end, 913 men, women, and children, including Jones, died.
Buying into the “Reagan Revolution”
One of the fastest-growing portions of America’s population during the 1980s didn’t have a clue what Reagan was talking about when he laid out his vision of the country and probably wouldn’t have liked it had they understood. They were immigrants from countries like Mexico, Cuba, Haiti, and Vietnam who came to the United States by the tens of thousands during the 1980s. Many of them were counting on some form of government assistance to get started in their new lives in a new land.
But the people who had voted for Reagan knew exactly what he was talking about. Many of them were part of the Sunbelt, the fast-growing states of the Southeast, Southwest, and West. As the region’s population grew, so did its representation in Congress — and its political clout. (The area became so powerful that every president elected between 1964 and 2008 was from a Southern or Western state.) In the West, in particular, Reagan’s call for less government was in perfect harmony with the Sagebrush Rebellion. The rebellion, which was mostly rhetorical, was a reaction to land use and environmental regulations made in faraway Washington that were considered a threat to development of urban areas and resource-based industries, such as timber and mining. Reagan was the beneficiary of the growth in the Sunbelt’s clout.
Reagan also benefited from a revival in Christian evangelicalism that married itself to conservative politics in the late 1970s and 1980s. Conservative evangelicals — those who said they had been “born again” through a direct personal experience with Jesus Christ and who were often referred to in a political sense as the “Christian Right” — were alarmed at what they saw as the country’s moral laxity in the 1960s and early 1970s. America’s real problems, they argued, could be traced to feminism, abortion, rising divorce rates, and homosexuality.
Groups like the Moral Majority, led by a Virginia-based television evangelist named Jerry Falwell, became powerful political forces in terms of raising money and mobilizing mass support — or opposition — for legislation and political candidates. Another “religious right” leader, Marion G. “Pat” Robertson founded the Christian Coalition and twice ran for president himself.
Finally, Reagan was supported by followers of a more secular cause — tax cutting. The high inflation of the 1970s caused many people’s income and property values to rise — and also pushed them into higher tax brackets that ate up much of the increases. That naturally fueled taxpayers’ anger. In California, a cranky political gadfly named Howard Jarvis successfully pushed through an initiative that dramatically cut property tax rates and required state and local governments to drastically shift their way of financing government operations. The success of Proposition 13 led to similar efforts in other states. It also helped Reagan push through his own brand of taxcutting.
Jim Bakker
He once spent $100 on cinnamon rolls so his hotel room would smell nice, which was okay because he was doing God's work — and had plenty of cash to spare.
Jim Bakker was born in 1940 and grew up in a small town in Michigan. After high school, he attended a Bible college and became a minister. In the early 1970s, Bakker began a Christian puppet show on a local television station in Virginia. He developed a television ministry that became known as the PTL Club, which to followers stood for "praise the Lord" and to critics stood for "pass the loot."
There was plenty of that. With contributions from hundreds of thousands of his followers, Bakker and his wife Tammy Faye (who wore what seemed to be pounds of makeup and wept at the drop of a psalm) built Heritage USA, a 2,300-acre Christian-themed resort, water park, and entertainment complex in South Carolina. In 1988, however, it was revealed that PTL had paid $265,000 to a former secretary named Jessica Hahn to keep her quiet about a sexual encounter she had had with Bakker eight years before.
The revelation was only one of many that followed over the next year. In 1989, Bakker was convicted of bilking more than 100,000 people of $158 million. He served five years in federal prison, and the scandal helped put the brakes on the momentum of the Christian Right.
Paying for “Reaganomics”
Reagan figured that if you cut taxes on companies and the very wealthy and reduced regulations on business, they would invest more, the economy would expand, and everyone would benefit. Of course, this approach would require cutting government services, which would most affect Americans on the bottom of the economic ladder. But the benefits would eventually “trickle down” from those on the top of the ladder to those on the bottom. At least, in theory. So, early in his administration, Reagan pushed through a package of massive tax cuts, and the economy got better. Unemployment dropped from 11 percent in 1982 to about 8 percent in 1983. Inflation dropped below 5 percent, and the Gross National Product rose.
While Reaganistas were quick to point to the president’s policies as a great deal, critics pointed in a different direction. Although Reagan had cut taxes, he and Congress had failed to cut government spending. In fact, he greatly increased spending on military programs. Because the government was spending far more than it was taking in, the national debt rose from about $900 billion in 1980 to a staggering $3 trillion in 1990. Moreover, most of the benefits of Reagan’s trickle-down approach failed to trickle, priming the pump for another economic downturn after he left office.
Dealing with foreign affairs
As a true conservative, Reagan didn’t much care for the Soviet Union or communists in general. He heated up the Cold War by, among other things, referring to the Soviets as amoral and irreligious. (Toward the end of his second term, however, Reagan’s anti-Soviet feelings began to soften, particularly after a moderate named Mikhail Gorbachev became Soviet leader.)
Reagan also irritated the Soviets by proposing a giant military program called the Strategic Defense Initiative (SDI, more popularly known as “Star Wars” after the popular science-fiction film). Reagan’s plan included missile-destroying lasers based on satellites in space. His vision never went anywhere, however, because Congress refused to go along with the program’s enormous costs.
Reagan also supported virtually any government that was anti-communist, including repressive regimes in Latin America, and he was quick to respond to provocations by terrorist acts supported by Libya. But he did withdraw American peacekeeping troops from war-torn Lebanon after a 1983 terrorist attack killed 241 U.S. marines stationed there. One of the anti-communist groups Reagan’s administration supported was called the contras in Nicaragua, and it resulted in the biggest embarrassment of Reagan’s presidency. In 1986, it was revealed that the White House had approved the sale of weapons to Iran as part of a mostly unsuccessful effort to win the release of some U.S. hostages in the Middle East.
The Challenger tragedy
It was cold and windy at Cape Canaveral the morning of January 28, 1986, but U.S. space program officials were determined to go ahead with the launch of the space shuttle Challenger. After all, the Challenger had already made nine successful trips into space and the National Aeronautics and Space Administration (NASA) had run 24 space shuttle missions without a major problem.
At 11:38 a.m. (EDT), NASA launched its 25th mission. At 11:40, as thousands of spectators watched in horror at the launch site and millions more watched on television, the shuttle exploded shortly after lifting off. All seven of the crewmembers were killed, including a Concord, New Hampshire, schoolteacher named Christa McAulliffe who was along for the ride as a way of increasing children's interest in the space program.
The cause of the explosion was later traced to a flaw in the rocket's booster system and led to a complete reevaluation of the shuttle and an examination of more than 1,000 of its parts. More than two years passed before the shuttle program was allowed to resume — and 17 years passed before the next space shuttle disaster: The Columbia fell apart over Texas on its reentry on February 1, 2003, killing all seven crew members.
It turned out that some of the money from the arms deal had been illegally siphoned off to the contras. Most of the blame for the scandal was pinned on an obscure Marine lieutenant colonel named Oliver North. But like other calamities, the Iran-contra mess did little to harm Reagan’s popularity or inflict any lasting damage on his administration. In fact, it didn’t even hurt the election of his successor in the White House, a one-time Reagan political foe who had become Reagan’s dutiful vice president. His name was George Bush.
Warming Up after the Cold War
For more than four decades, the ideological conflict between the Free World and the Communist World had influenced just about every aspect of U.S. life. The federal budget was built around the idea of defending the country against communism. Advances in science and medicine were often driven by the fervor to stay ahead of the communists. Schoolchildren were indoctrinated as to the evils of the communist menace and chided to do better than commie kids. Even international sporting events became intense political struggles.
But the boogeyman began to deflate in 1979, when the Soviet Union intervened in a civil war in Afghanistan. Over the following decade, the Soviets poured thousands of troops and millions of rubles into what became the equivalent of our Vietnam. The difference was that the U.S. economy was strong enough and flexible enough to survive Vietnam, whereas the ponderous Soviet economy all but creaked to a halt.
Oil all over the place
On March 24, 1989, Alaska's Prince William Sound was one of the most scenic and beautiful inlets in the world, teeming with birds, fish, and marine mammals. On March 25, 1989, it was a heartbreaking, stomach-turning mess: the site of the biggest oil spill in U.S. history.
It began when a giant tanker, the Exxon Valdez, hit a well-marked reef after picking up a load of crude oil at the town of Valdez. More than 11 million gallons of oil oozed into the sound and spread over hundreds of square miles. More than 250,000 birds were killed along with thousands of other animals.
It was quickly determined that the 984-foot ship's captain, Joseph Hazelwood, had been drinking before the accident. He was convicted the following year of negligence and sentenced to 1,000 hours of community service. He began the service in 1999, after nine years of appeals. Exxon spent $2.2 billion on cleanup efforts and paid another $900 million in a settlement to the state and federal government. As the twenty-first century began, there was still oil to be found on the shores of Prince William Sound.
In 1985, Mikhail Gorbachev became the Soviet leader. Gorbachev realized that the old Soviet system could not continue to dominate Eastern Europe.
In fact, it couldn’t even continue to function as a country without some dramatic changes. He initiated two major concepts: perestroika, or changes in the Soviet economic structure, and glasnost, or opening the system to create more individual freedoms.
On November 9, 1989, the wall that divided East and West Berlin was opened. By the end of the year, Soviet-dominated regimes in a half-dozen European countries, including East Germany, had collapsed and been replaced by more democratic governments. By the end of 1991, the Soviet Union itself had dissolved into a set of mostly autonomous republics. The Cold War was over.
The collapse of the Soviet Union left the United States as the world’s only true superpower. But it took no time at all for one of the planet’s seemingly inexhaustible supply of thugs and bullies to test the United States’ will to live up to its role as the world’s leader.
Engaging in the Gulf War
If impressive resumes translated into leadership, they’d be carving George Bush’s bust on Mt. Rushmore right now. After all, he was a Yale graduate, a World War II hero, an ambassador to China, a CIA director, and vice president under Reagan.
Byting off the apple
Steve Jobs was a college dropout with marketing talents, and Steve Wozniak was an electronics nerd with an inventive mind. When the two got together, interesting things occurred.
First it was a device that allowed them to make free, if illegal, long-distance calls. Then it was an early video game called "Breakout." But the two Steves yearned to do something really radical: Create an affordable computer that the average American could use at home.
So Jobs sold his Volkswagen van and Wozniak his favorite calculator. With the $1,300 they raised, they began work on their "personal" computer, laboring in a garage, an attic, and a spare room in the home of Jobs' parents in Palo Alto, California. They called it "Apple," partly in tribute to the Beatles' recording company of the same name and partly because Jobs just liked apples.
In 1976, the duo sold their first 50 computers for $500 each, but they sold only 125 more through the rest of the year. In 1977, however, they developed Apple II. It was the first true PC, with color graphics, keyboard, power supply, memory and carrying case, and with a floppy disk drive, it sold for $1,195 ($4,250 in 2008 dollars). By 1981, sales had reached $335 million. And that's a lot of Apples, no matter how you slice them.
Bush was easily elected president in 1988 after waging a rather sleazy campaign against Democratic nominee Michael Dukakis. Voters were so turned off by the campaign and politics in general that the turnout was the lowest for a presidential election since 1924. As president, several things hampered Bush. Democrats controlled both houses of Congress. Reagan’s personal popularity was a hard act to follow. And Bush was simply not much of a leader, especially when it came to solving domestic problems.
Bush’s leadership was put to a stern test in 1990. On August 2, the army of Iraq invaded the small neighboring country of Kuwait and quickly took over. Iraq was led by a brutal bozo named Saddam Hussein who proclaimed he was annexing Kuwait to Iraq and anyone who didn’t like it could stuff it.
Bush chose not to stuff it. To Bush supporters, his decision to intervene was based on his desire to defend the defenseless. To his critics, it was to protect U.S. interests in Kuwait’s oil production. Whatever the reason, in the weeks following the Iraqi invasion, Bush convinced other world leaders to establish a trade embargo on Iraq. Almost simultaneously, the United States, Britain, France, Egypt, Saudi Arabia, and other countries began assembling a massive armed force in case the economic pressure didn’t work.
When that proved to be the case, the United States and its allies launched a gigantic aerial assault on Iraq on January 16, 1991. After six weeks of massive bombardment, the allied forces sent in ground troops. The vaunted Iraqi military turned out to be made of papier-mache. U.S. casualties were light, and about 100 hours after the ground war started, Iraq threw in the towel.
The victory, however, was not all that victorious. Kuwait was free, but the Iraqi dictator Saddam remained in power. Nine years after the war, the United States was still spending $2 billion a year to enforce a no-fly zone over Northern Iraq, kept an armada of Navy ships in the area, and maintained a force of 25,000 troops in the region.
Back on the home front
If the Gulf War left a sour taste in the mouths of Americans who questioned its purpose, necessity, and results, things at home weren’t much sweeter. For one thing, the economy was in the Dumpster. Like the federal government, many individuals and corporations had borrowed heavily in the 1980s, causing the number of bankruptcies in the country to soar. That, in turn, triggered a mess in the savings and loan (S&L) industry.
The Reagan Administration, in its quest to lessen the role of government, had pushed to loosen up regulations on savings and loan companies. The result was that many S&Ls overextended credit and made stupid investments. Many of them collapsed. Tens of thousands of investors lost their savings, and the federal government had to spend billions of dollars to bail many of the S&Ls out.
Not all the disharmony was economic. On March 3, 1992, a 25-year-old black man named Rodney King was pulled over for reckless driving by Los Angeles police. A witness happened to videotape several of the police officers beating King. Despite the videotaped evidence, an all-white jury acquitted the police. Los Angeles erupted in the worst U.S. domestic violence in more than a century. Before it was over, 53 people died, 4,000 were injured, 500 fires had been set, and more than $1 billion was lost in property damage (see Figure 19-1).
All of this did not bode well for the incumbent president. Not only were Americans generally dissatisfied with the way things were, but an eccentric Texan named Ross Perot also compounded Bush’s troubles. Perot was a billionaire who decided to run for president as a third-party candidate. Despite his immense wealth (he financed his own campaign), Perot ran as a populist, railing against the influence of special interests in the political process.
Good question
"People, I just want to say, you know, can we all get along? Can we just get along?"
— Rodney King, to reporters during the Los Angeles riots, May 2, 1992.
When the votes were counted, Perot had gathered an impressive 19 percent, the best showing by a third-party candidate since Theodore Roosevelt in 1912. Bush finished second. The winner was a 46-year-old Democrat who had been elected governor of Arkansas five times.
His name was William Jefferson Clinton, and the name of his hometown said a lot about the feelings of the country as it headed down the homestretch of the twentieth century. The name of the town was Hope.
Figure 19-1: Aftermath of the Los Angeles riots.