domestic agenda was dominated by striving for a bal-
anced budget, developing free trade agreements,
and addressing the legacy of problems that he inher-
ited from Reagan’s secret Iran-Contra policies. Dur-
ing the four years that Bush was president, the na-
tional debt was not eliminated; this was due as much
to increased spending as to a slowing economy, with
the resultant decline in federal income.
Bush’s second domestic priority was to establish a
free trade zone among the United States, Canada,
and Mexico—the North American Free Trade
Agreement (NAFTA). Despite increasing opposi-
tion from labor unions and other groups, NAFTA
gained momentum and widespread bipartisan polit-
ical support. NAFTA supporters envisioned a free
trade zone comparable to the European Union; its
opponents feared the loss of jobs and the displace-
ment of businesses to Mexico. While the Bush ad-
ministration did succeed in signing a preliminary
document, it was left to Bill Clinton’s administration
to conclude the process in 1993.
Finally, Bush found himself with the legacy of the
Iran-Contra scandal and the likelihood that six for-
mer Reagan administration officials would be in-
dicted—including former secretary of defense
Caspar Weinberger. Some in Bush’s inner circle an-
ticipated that Bush himself could possible be in-
dicted and, at the very least, would be called to testify
on the Weinberger case. On December 24, 1992, less
than a month before leaving office, Bush pardoned
Weinberger and the others, and the case was
dropped. These pardons were condemned by the
national press and the general public.
Foreign Policy and Accomplishments When Bush
became president in 1989, the United States was at
peace, but historic forces were unfolding through-
out the world. The first year of his presidency wit-
nessed the collapse of Soviet domination of the East-
ern European states and the fall of the Berlin Wall;
new prodemocratic regimes emerged and new polit-
ical lines were drawn on ethnic-nationalist lines. At
the same time, American attention was diverted to
Central America, where the Panamanian dictator
Manuel Noriega was assisting in the transfer of ille-
gal drugs to the United States. In the fall of 1989, the
United States supported an anti-Noriega campaign
within Panama and, in December, an American mili-
tary force of twenty-five thousand invaded Panama
and toppled the Noriega regime, replacing it with a
pro-American government. Noriega was imprisoned
in the United States, and the Bush administration
provided support for the new government through
January, 1993.
In 1990, Iraq, under the leadership of Saddam
Hussein, invaded and occupied the neighboring
state of Kuwait. Hussein announced that Kuwait was
annexed into Iraq. Bush immediately denounced
this aggressive action and worked for months
through the United Nations and direct talks with
other states to form a coalition to pressure or force
Iraq to withdraw to its original borders. A U.N. dec-
laration gave Iraq until January 15, 1991, to with-
draw; Iraq did not comply. On January 17, 1991, the
American-led coalition initiated air attacks against
Iraq; on February 24, the ground assault began.
Within forty-eight hours, Iraqi troops were fleeing
Kuwait, and advanced units of the coalition strike
force were within 150 miles of Baghdad. Bush or-
dered a cease-fire on February 27, stating that Ku-
wait had been liberated.
The final major foreign policy development dur-
ing the Bush presidency related to U.S.-Soviet rela-
tions. Bush and Soviet leader Mikhail Gorbachev
held a summit conference in December, 1989, in
Malta; they announced that the previous hostile re-
lationship was over and that they would be partners
in moving the world toward peace. However, star-
tling events in the Soviet Union were unfolding rap-
idly. In August, 1991, a group of reactionary politi-
cal and military leaders attempted to overthrow
Gorbachev; he was arrested while on vacation in the
Crimea, and it appeared that his fate was sealed.
However, Russia leader Boris Yeltsin championed
opposition to the coup d’etat, and the hard-liners
were defeated. Gorbachev was weakened, and in
December the Soviet Union was being dismantled
by separatist groups. On December 31, 1991, the
Soviet Union ceased to exist. The Bush administra-
tion allowed these events to unfold without any in-
terference.Presidential Election of 1992 With victory against
Iraq in 1991, the reelection of George Bush to a sec-
ond term appeared to be assured, but the American
electorate was unsettled. The economic rebound
was not as strong as anticipated, and Bush appeared
not to recognize the seriousness of the homeless is-
sue in major cities. In addition, he had raised taxes
in 1990 when he had promised in 1988 that he would130 Bush, George H. W. The Nineties in America