Nixon inherited a deteriorating (although still favorable) balance of trade and rising rate of inflation. Between 1960 and 1965, consumer prices grew only about 1 percent per year; in 1968, this figure exceeded 4 percent. By 1971, the unemployment rate topped 6 percent. According to conventional wisdom, expressed in an economic concept called “the Phillips curve,” when unem- ployment rises, prices should remain constant or even decline. Yet both unemploy- ment and inflation numbers were going up simultaneously. Economists coined the term stagflation to describe this puzzling convergence of economic stagnation and price inflation. Along with stagflation, U.S. exports were becoming less competitive in international markets and in 1971, for the first time in the 20th century, the United States ran a trade deficit, importing more products than it exported. Abandoned the gold standard - currencies float and fluctuate OPEC embargoes oil exports to US in response to US support for Israel START HERE BIAS approving a military “incursion” into Cambodia, an ostensibly neutral country. The 1970 operation into Cambodia, which targeted a command center from which North Vietnam conducted the war in the South Critics charged that the United States, in the name of anticommunism, too often linked its diplomatic fortunes to questionable covert actions and unpopular military governments. BIAS some of them, perhaps, precipitated by Republican “dirty tricksters”) Yes or No - include data Although the 26th Amendment, ratified one year before the election, had lowered the voting age to 18, relatively few of the newly enfranchised voters cast ballots. Youth NEVER vote page 1020 BIAS on forgetting about Watergate What might account for this change? First, although nearly a dozen members of Nixon’s administration—including its chief law enforcement officer, John Mitchell— were convicted of criminal activities, the president avoided prosecution. Gerald Ford granted him an unconditional pardon. The nation was spared the spectacle of a for- mer president undergoing trial, but it was also denied an authoritative accounting, in a court of law, of Nixon’s misdeeds. Another reason for fading memories may be the media’s habit of attaching the Watergate label to nearly every political scandal of the post-Nixon era. The suffix -gate became affixed to grave constitutional episodes and to obviously trivial political events. Trivial events??? Wikipedia list http://en.wikipedia.org/wiki/List_of_federal_political_scandals_in_the_United_States Ford - pardoning Nixon Carter - Iranian hostages Reagan - Iran-Contra Affair Bush Sr. - knowledge of Iran-Contragate denied during election, and pardons Read my lips - no new taxes Clinton - Lewinsky scandal and impeachment - obstruction of justice Bush - Weapons of mass destruction Obama - fast and furious, guns an drugs, IRS and conservative groups, Benghazi attack controversy Aren't we led to believe that we live in the most scandal-ridden time TODAY? Presentism, lack of history knowledge, and post Watergate significance BIG THEME Conclusion chapter 29 This growth of government power prompted divisive debates that polarized the country. The hopes of the early 1960s—that an active national government could promote liberty and equality both at home and throughout the rest of the world—ended in frustration. Many Americans became skeptical, many even cynical, about expanding the power of the federal government in the name of expanding liberty and equality. IMPORTANT FOR CHAPTER 30 UNCERTAIN TIMES, 1974–1992 p1021 Events of the 1960s and early 1970s, particularly Vietnam and Watergate, however, shook faith in government. Secrecy, corruption, and economic problems bred further disillusionment. During the 1970s and 1980s Americans debated how to respond to an aging industrial economy, a ballooning federal deficit, and a beleaguered social welfare system. Did the country need new governmental programs, or might conditions improve if Washington reduced its role? During these years, the polarization of American politics that had become so evident during the Vietnam War and Watergate eras deepened and broadened, sparking new controversies over issues such as abortion, taxation, affirmative action, and environmental regulations. p1023 Jimmy Carter’s lack of a popular mandate and his outsider status proved seri- ous handicaps. … The 865-day presidency of Ford and the one-term administration of Carter reflected the uncertainties of post-Vietnam and post-Watergate America. Democrats tended to favor programs that might stimulate employment and economic growth; Republicans leaned toward policies that cut government spending. p1024 Increas- ing the minimum wage and enforcing stringent safety and antipollution regulations, they argued, drove up the cost of doing business and forced companies to raise prices to consumers. Defying many Democrats in Congress, he cut spending for social programs, sought to reduce capital gains taxes to encourage investment, and inaugurated the process of “deregulating” various industries, beginning with the financial and transportation sectors. p1025 Republicans tended to argue on behalf of less government spending on wel- fare programs; Democrats generally favored greater assistance to the underemployed. p1027 Carter argued that Cold War alliances with repressive dictatorships, even in the name of anticommunism, undermined U.S. influence in the world. Wikipedia vs. Textbook http://en.wikipedia.org/wiki/Governorship_of_Ronald_Reagan#Governorship_legacy page 1030 At the same time, a taxpayer revolt that had swept through California politics during the late 1970s provided a model for Reagan’s attack on “tax-and-spend” policymaking at the federal level. The situation was ironic, however, because California’s tax revolt had emerged in response to tax increases adopted while Reagan was the state’s governor. Reagan also seized issues that the Democratic Party had long regarded its own: economic growth and increased personal consumption. p1034 Despite sometimes sharp criticism, especially over the soaring federal deficit, the widening gap between rich and poor, and the role that government should play in regulation and welfare, Reagan remained popular. p1035 vocabulary Reagan revolution succeeded in advancing a new Republican agenda that helped change the nation’s political vocabulary. Democrats had once invoked “liberalism” to stand for governmental initiatives to stimulate the economy, promote greater equality, and advance liberty for all. Republicans, however, deployed the term “liberal” as a code word for wasteful social programs devised by a bloated federal government that gouged hardworking people and squandered their tax dollars.