12. THE WORLD'S SOLE SUPERPOWER
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| REAGAN ENTERS THE WHITE HOUSE |
The Reagans waving from the
presidential limousine
during the Inaugural Parade – January 1981
A Reagan family portrait
on the day of his inauguration
January 20, 1981
As
the last humiliation to Carter, on exactly the day Reagan was being sworn in as the new
U.S. president, Iran released the American hostages – and they were on their
way home. True, Carter had worked hard for that
release. But the fact that it came when
it did made it appear that it was done possibly out of fear of the new tough
president – at least that is how a lot of Americans read the event.
His
youth seemed unexceptional, even at Eureka College where he was merely a "C"
student.
But it was a very troubled time for the movie
industry, due to the political controversies aroused by the postwar Red Scare, and
Reagan had to tread lightly, although he himself was strongly anti-Communist in
his own political standing. Yet here is where his strong Christian background –
and his mother's influence – played a key part in his efforts to bring
reconciliation rather than condemnation to all this political dynamic.
Unfortunately, such reconciliation did not work with his wife,
actress Jane Wyman, and their 9-year marriage ended in 1949 when she divorced
him because of all the political dynamics their lives were caught up in.
His known conservatism – and national popularity because of his
long hosting of the popular TV show, The General Electric Theater – led
him to be a keynote speaker at the 1964 Republican National Convention and
Barry Goldwater supporter. This in turn
caused the California Republican committee to ask Reagan to run against
Democratic Party Governor Pat Brown in the 1966 gubernatorial election, which
Reagan won!
Reagan and his wife Nancy
at his win of the California
governor's race – Nov. 8, 1966
As he approached the end of his second term as governor, he began
to look at the idea of running as the Republican candidate for the U.S.
presidency itself. And indeed, in the
1976 race, he became the leading contender against Ford, the latter who however
ultimately got the Republican nomination (but lost the presidential race itself
to Carter).
1980 Republican National Convention
- Reagan nominated
as the Republican presidential
candidate
The importance of the Christian religion would even become an
important part of his discussions with Gorbachev, in Reagan's efforts to bring
Russia out of its Communist camp and into a much freer world – one of peace
rather than contention.
| REAGAN GETS TOUGH |
A strike by public air traffic controllers – broken by President Reagan
But
the next year the situation had deteriorated again, especially after Syria
decided to intervene in the civil strife in Lebanon and invaded the country –
merely increasing the level of chaos there.
Then that October a truck-bomb attack on the UN barracks killed 241
American and 58 French soldiers. Now Reagan had a decision to make – pull
out – or dig in even more deeply.
Ultimately he decided to pull out in early 1984.
US Marine HQs bombed in
Lebanon
by Muslim fundamentalists –
October 1983.
241 Americans were killed; a French base was
simultaneously bombed: 58 Frenchmen were
killed)
American soldier being pulled
from the rubble of a terrorists
blast in Beirut, Lebanon – October
1983
The U.S. military intervention in Grenada (October 1983). Partly the
decision about Lebanon was shaped by events taking place in the Caribbean –
when Marxist revolutionaries overthrew the government of the tiny island
Republic of Grenada. From Reagan's point of view, this was a totally
unacceptable development, especially as Grenada was located on the path leading
to the entrance of the Panama Canal.
America did not need another opportunity for the Soviets to gain yet
another strategic position in the Western hemisphere. Encouraged by other Caribbean governments –
which felt themselves vulnerable to the same kind of action – Reagan sent American troops to Grenada – sparking the
angry outcries of the "anti-imperialist" wing of American politics
(and the world). Even the United Nations
was quick to protest the American action.
But the American troops moved so quickly (just a few days) to restore
the Republic's constitutional government back to power that the American voices
of opposition died away quickly. As for
the United Nations, Reagan was tiring of its whining – and simply
disregarded it – much to the delight of the majority of Americans. Clearly Reagan was not one to be pushed around by world public
opinion. Everyone – including the
Soviets – took notice.
U.S. Marines in Grenada -
1983
President Reagan and Jeane Kirkpatrick – 11 December 1984.
THE AMERICAN ECONOMY STRUGGLES FORWARD |
|
Supply-side economics. Reagan had made a big deal of how he intended to fight the stagflation (economic stagnation and accompanying inflation) with his own approach to the economic crisis (popularly termed "Reaganomics"). He was going to pursue the doctrine of supply-side economics – in short, get industry back up and running so that a more abundant supply of goods would begin to bring prices back to normal.  Reagan gives a televised address from the Oval Office, outlining his plan for Tax Reduction Legislation in July 1981 President Reagan consulting
with Congressional Leaders But how he planned to do that with Volcker's interest rates running so high was a huge mystery. With car loans and mortgages running at such high interest rates, few Americans were willing to purchase either cars or houses. Likewise, businesses could not contemplate their expansion when interest rates demanded by the financial world remained prohibitive. How exactly then was Reagan going to get production or "supply" back up and running again?
The brief dip in Volcker's "discount rate," that is, interest rates charged to banks that borrow from the Federal Reserve (chart above) – designed to help get Jimmy Carter renominated as the Democratic Party's 1980 presidential candidate – is clearly reflected in the simultaneous (also brief) recovery of the economy (the red indicator in the chart below)
 Energy prices. But something was stirring in the energy world. And it was coming from Russia. The Soviet economy was slowing down. Socialism had not brought "workers' paradise" to Russia – and Russian workers were losing interest in the well-being of their economy, with workers' absenteeism rampant at the workplace – as well as alcoholism when they did show up. Years of focusing the Russian economy on the military had left the country with little to offer its workers. Russia had no plans to cut back on its military – but needed something extra to provide funding in order to develop something of a private or personal economy. But the only such asset Russia possessed – one that had serious value on the world market – was oil and gas – which Russia was enormously abundant in. Russia was not a member of OPEC, but followed OPEC pricing closely. But now Russia was going to have to break from that group and drop prices for its petroleum products in order to get them to a hungry market ahead of OPEC. So in 1981 the Soviets lowered their prices. This now put OPEC members in a bind because they would have to do so also – in order not to have all their customers head off to Russia for their oil purchases. But then OPEC's lowering of its prices forced Russia to have to do another round of price reductions – forcing OPEC to do the same thing. Now a price war began to bring energy prices down – dramatically so. Thus the politically designed energy shortage, the primary cause of the global inflation, eventually came to an end – and inflation with it. Dealing with Volcker. Now Volcker no longer had the excuse of fighting inflation with his monetarist or tight-money strategy. Volcker, as the American economy's supposed savior, did not let up gladly – until Congress threatened to reduce the powers of the Federal Reserve if he did not do so. Thus interest rates finally came down – and the economy finally got up and moving again.< Social Security. One of the issues that had troubled the 1970s and was needing a solution heading into the 1980s was the matter of Americans' Social Security funding. Due to the immense energy-driven inflation that hit during the 1970s, the Cost of Living Allowance (COLA) had to be adjusted to the point that it nearly emptied out the assets of the Social Security Trust Fund. Thus Social Security taxing was increased from 2% to 6.15% of a worker's earning, helping somewhat. Also the rate of increase of the COLA was slowed up. Then in 1983 it was decided to separate the Social Security Fund from the federal government's general revenue, giving it its own dynamic to be worked with (at this point combining its account with the federal general budget account was actually considered a detriment – not a boost – to the federal budget picture!). But, provision was made to use now-independent Social Security Funds to "help" the federal government by purchasing the federal government debt – which is supported through the sale of bonds or IOUs to a funding source. And why not the Social Security Trust Fund? That money just sits there. Why not "invest" that money in government bonds? But critics pointed out that should some serious problem arise with the government debt, the people's Trust Fund could be found to be holding only worthless government IOUs. Defenders said that this was highly unlikely (conveniently forgetting the numerous times in the past that the federal government came close to financial failure). Supporters of the deal ultimately won the argument, and thus this indeed became the character of the Trust Fund: a major creditor to the federal government, holding a massive amount of federal government IOUs, at times fully one-half of the huge federal debt. Reagan's reelection in 1984. The Democrats would certainly understand that they were going to have a hard time running against the very popular Reagan – who was due to run for reelection in 1984. Democrats nominated the former U.S. senator from Minnesota and vice president under Carter, Walter Mondale, as their presidential candidate. In the end, Reagan scored a huge 58.8% of the popular vote and 525 electoral college votes to Mondale's 40.6%, and only 13 electoral college votes: the ever-Democratic-Party supporting three votes of Washington D.C.[1] – and those of Mondale's home state of Minnesota. The outcome was never in doubt.
Jesse Jackson – in the Presidential
run in 1984
Walter Mondale – Democratic
Presidential candidate
The Reagan-Mondale televised
debates – 1984
Reagan being sworn in for
his second term in the rotunda of the US Capitol – January 1985 [1]Ever since Washington, D.C. was given the right to choose its own presidential electors in 1961 (the 23rd Amendment), D.C. has been the strongest Democratic Party supporting constituency in the nation. This is hardly surprising, as the Democratic Party represents perfectly the idea that the Washington bureaucracy should be running the country. In fact it is surprising that there are any Republicans at all in this district! Thus in the most recent national elections, the Democrat Biden received 92.15% of D.C.'s vote, compared to the Republican Trump's 5.4%, a D.C. voting spread identical to that of the 2016 race between Hillary Clinton and Trump. |
| MAJOR DEVELOPMENTS IN FOREIGN POLICY |
But
he pushed things too far with Reagan when it was discovered that he
was connected to the 1986 Berlin bombing of a discotheque in which a number of
American soldiers were killed – and Reagan retaliated by sending patrol
boats into waters claimed by Libya (considered by the West as high seas and
thus nobody's territory) – which naturally were fired on by Libya – and which Reagan answered by attacking Gaddafi's Presidential Palace. When the United Nations condemned the
attacks, Reagan simply ignored the
organization – as did a number of other countries which too were tired of Gaddafi's ventures (principally
supporting various terrorist organizations such as the Irish Republican Army
and various Moro or Islamic jihadist groups operating in the Philippines). Even the Soviets found themselves backing
away from Gaddafi, not wanted to get dragged
into an unwanted event.
Anyway,
for a while, Gaddafi would be forced to behave –
for fear of Reagan's reprisals.
Other militant organizations. But huge problems
in the Middle East were coming from a number of other sources, principally the PLO or its subgroup Fatah, plus Hezbollah and Hamas – primarily dedicated to the
crippling or even destruction of Israel.
But each represented a very different part of the world of Islam. The Palestinian Liberation Organization (PLO) or Fatah had long been the voice
of the Palestinians chased out of their homelands by the Jewish migration into Palestine – and was the
organization officially sponsored by the Arab League. Defending both Christian and Muslim Arab
interests in Palestine, it tended to be mostly Secular in its promotion of
Palestinian rights. Hezbollah however was a strongly
Muslim voice of the Shi'ites – founded and supported by
Iran and numerous Shi'ites among the Lebanese and
Syrians – which found itself constantly in competition with the Arab Sunnis. Then Hamas came into being in the later
1980s – upset that the PLO/Fatah was beginning to show a
willingness to negotiate a compromise of some kind with the Israelis. Hamas was also more militantly Muslim
(Sunni) – rather than merely Secular
in character.
The Rapid Decline of the Soviet Empire: Afghanistan. Meanwhile, the Soviets found themselves caught
in a quagmire of rising Afghan Muslim and
tribal hostility – aroused by the Russian attempt to impose a Communist puppet
government in the Afghan capital city, Kabul.
Afghan rebels (mujahedin) even looked to the Reagan government for help in ousting
the Russian troops occupying their country – finding Reagan very eager to help out. Americans sent the mujahedin all varieties of
weapons, including missiles that could easily take out Russian tanks and
jets. Consequently, the Soviets found
themselves struggling to hang on to any kind of defensive position in the
country. Soon anti-war sentiments began
to grow among the Russians – including even members of the Russian military.
Texas Congressman Charlie Wilson in Afghanistan
Wilson was a prime mover
in Operation Cyclone, in which
the US sent $ millions to support the
mujahidin in their fight
against the
Soviets (unfortunately much of the money
ended up in corrupt Pakistani
military hands). Resistance
by conservative
Muslim mujahidin however is grinding
down the Soviet effort to maintain Communist control
in Afghanistan.
Ahmad Shah Massoud – the
"Lion of Panjshir"
This
engineer-turned-mujahidin
proved to the the most
effective of the Afghan resistance commanders. When
the Taliban later
took over the country, he became their
prime opponent. The Taliban
assassinated him just days
before the September 11, 2001 attack
on the New York
Twin
Towers)
Yuri
Andropov
1982-1984
Konstantin Cernenko
1984-1985
Gorbachev introduced a number of
liberalizing reforms – known as glasnost (more personal
freedom for the people), perestroika (liberalizing the
economic system), and demokratizatsiya (a democratizing of the political
system). These reforms were well
received both at home and abroad – and led to a number of very friendly
meetings between Reagan and Gorbachev – to see how they could
finally end the Cold War.
A Russian practicing
glasnost
on a Russian street
Reagan and Gorbachev at the
first Summit in Geneva, Switzerland
19 November 1985
... if you truly want peace and liberalization – Mr. Gorbachev, open this gate! Mr. Gorbachev, tear down this wall!
This did not happen right away – but something like it was underway. And Reagan knew so – although he would be one year out of office when this challenge finally was answered with the coming down of the Iron Curtain separating East and West Europe.
"Mr. Gorbachev, tear down this wall!" – June 1987
______________________________________________
Gorbachev,
realizing that the Afghan War was merely
weakening further the Soviet
strategic position globally,
decides to call it quits in Afghanistan –
July 1987
Soviet Commander Boris Gromov
announcing the Soviet
troop pullout from Afghanistan – July
1987
Afghan troops (on the left)
watching Soviet troops
leaving Afghanistan – 1988
___________________________________________________
Gorbachev with Reagan on
a summit visit to Washington – 1987
The Gorbachevs visit the
Reagans in Washington – December 1987
Gorbachev and Reagan sign
the Intermediate Nuclear Forces
(INF) Treaty in Washington – 1987
A Soviet sentry guarding
ICBMs scrapped under a 1987
disarmament treaty with the US
Gorbachev and Reagan in Moscow
- 1988
President Ronald Reagan visiting
with Soviet Premier Mickail
Gorbachev in Moscow,
chatting in front of St.
Basil's Cathedral
on Red Square
China continues self-reform under Deng Xiaoping. While the Soviets were undertaking deep
reforms to get their economy up and moving, the Chinese Communists were doing
the same thing, except with very different results. At the same time that the reforms crumbled
the Soviet social-economic-political order, in China similar reforms were
clearly working to strengthen Chinese society – politically in a moderate
fashion and economically in a massive fashion.
Part
of this was due to the Chinese entrepreneurial instinct being still alive and
well in China – especially along its major Eastern cities such as Shanghai,
which earlier in the century had been a hub of Chinese industry. But part of it was also due to the very
favorable trade protection deals with the West that Deng had secured from the Westerners,
the latter anxious to see China move closer to their world of capitalism.
Deng also kept important restraints on the dynamic in order to keep it from getting out of control (as things had developed in Russia), largely through the heavy government subsidizing of this new "independent" industrial dynamic. This heavy government support not only gave huge trading advantages to the Chinese industrialists, it kept them in a very cooperative relationship with the Deng government. Thus the Chinese economy began to boom, annual growth rates averaging 8-10% during most of the 1980s and 1990s.
| THE IRAN-CONTRA AFFAIR |
But
even before the new Congress could take its seat, the Iran-Contra Affair (as it came to be
known) exploded as a major news item – forcing Reagan in mid-November to go before
national television to explain his side of the affair. Two weeks later U.S. Attorney General Edwin Meese admitted that the money
from Iran was used to finance the Contra shipments. On that same day Reagan fired Marine Lt. Col. Oliver North – who confessed to being
in charge of the whole matter. And on
that same day Reagan set up a three-man
Presidential Commission, headed up by former Texas Senator John Tower, to look into the matter. In late February of the following year (1987)
the Tower Commission delivered its report, outlining the actions of various
participants in the whole affair – although it largely excused Reagan as not having much knowledge
of the operation.
But
in the meantime (January), the new Democratic Congress set up its own
investigative committees – dismissing the Tower Report – obviously looking for
more material to bring against the Reagan "imperial presidency." It was Watergate all over again. The hearings ran from early May to early
August – again watched closely on TV by the Americans – especially when Lt.
Col. North was interviewed. Finally a
Joint Committee Report was published in November – with Republican members of
the Committee issuing a dissenting Minority Report. Basically Reagan was criticized for not doing
his job in staying on top of such matters.
However, the Report came up with nothing specific that Congress could
charge Reagan with. But even then, that would not be the end of
the matter – as further investigations were conducted by a
Democrat-controlled Congress all the way into 1991.
Lt. Col. Ollie North Testifying
before Congress
in the Iran-contra affair – July 1987
Miles
H. Hodges
