Chapter 23Section 2

After 12 Years of Republicans…• President Clinton believed the

huge federal deficit was a problem.

• When President Clinton took over as president, the state of the national deficit had nearly quadrupled under Reagan and Bush, adding billions of dollars annually to the national debt.

• The federal deficit forced the government to borrow money and drove up interest rates.

Lowing Interest Rates

• Clinton believed lower interest rates were the key to economic growth.

• Clinton believed this would help the economy because businesses would borrow money to expand and create jobs, and consumers would borrow money for mortgages, car loans, and other items.

Cutting Entitlements

• However, reducing government spending would involve cutting programs such as Social Security and Medicare.

• About half of all government spending went to entitlement programs such as Social Security in early 1993.

Raising rather than cutting…

• Entitlement programs are hard to cut because many Americans depend on them.

• Clinton decided to raise taxes instead. – This unpopular plan

narrowly passed Congress.

Universal Health Care

• President Clinton created a task force led by his wife, Hillary Rodham Clinton, to create a plan that guaranteed health care to all Americans.

• The plan put too much of the burden of payment on employers.

Opposing Health Care Reform

• Hillary Rodham Clinton’s health benefits plan was opposed by small-business owners; the insurance industry and doctors’ organizations; Republicans.

• The proposed health benefits plan died without a vote in Congress.

FMLA

• Clinton succeeded in having the Family Medical Leave Act passed.

• The Family Medical Leave Act gave workers up to 12 weeks per year of unpaid family leave for the birth or adoption of a child, or for the illness of a family member.

Americorps

• Clinton also created the AmeriCorps program.

• It put students to work improving low-income housing, teaching children, and cleaning up the environment.

Brady Bill • Clinton also got Congress to pass

a gun-control law, called the Brady Bill.

• Elements of the Brady Bill included a waiting period before people could buy handguns, and background checks run by the police before a gun dealer could sell someone a handgun.

• In addition the bill that gave states money to build new prisons and hire more police officers.

Unpopular

• Despite his successes, Clinton was unpopular by 1994. – He had raised taxes and did

not fix health care.

• In the 1994 Mid-term Congressional elections, Republicans won control of both houses in Congress (i.e., House of Representatives and the Senate).

Contract with America

• Republicans in congress created the Contract with America and some of the elements of the Contract with America included:– Lowering taxes– Welfare reform– Tougher anticrime laws, – Term limits for members of

Congress– Balanced budget

amendment

How success was the CWA…

• The House passed most of the legislation with their Contract with America, but the Senate defeated parts of the contract, and Clinton vetoed others.

1995 Government Shutdown • In 1995 Republicans in Congress

clashed with Clinton over the new federal budget.

• Clinton vetoed several Republican budget proposals, claiming that they cut into social programs too much.

• The Republicans thought that if they stood firm, the president would finally approve the budget.

• Clinton did not budge, and the government shut down for lack of funds.

Who wins the showdown Clinton v. Congressional Republicans

• Clinton regained much of the support he had lost with the Federal government shutdown.

• The closing of the federal government after Clinton refused to approve the Republicans’ budget forced Republicans in Congress to work with President Clinton rather than against him.

Welfare Reform Act

• They eventually passed a budget as well as the Health Insurance Portability Act and the Welfare Reform Act.

1996 Presidential Election

• The United States economy as the 1996 campaign began was booming, as unemployment and inflation fell to their lowest levels in 40 years, while the stock market soared.

• Clinton won the election, defeating Senator Bob Dole. Republicans however kept control of Congress.

• During Clinton’s second term, he and Congress continued to shrink the deficit. In 1997 Clinton presented a balanced budget to Congress. By 1998 the government collected more money than it spent.

• Clinton focused on the nation’s children. He asked Congress to pass a $500 per child tax credit. He also signed the Children’s Health Insurance Program, which provided health insurance to children whose parents could not afford it. Clinton also increased aid to students.

• By 1998 Clinton became involved in a scandal.

• He was accused of setting up illegal loans for an Arkansas real estate company while he was governor of Arkansas.

• Kenneth Starr, a former federal judge, was appointed to investigate.

• A new scandal emerged involving a personal relationship between Clinton and a White House intern. Some evidence showed that Clinton had committed perjury, or lied under oath, about the relationship. Starr determined that Clinton had obstructed justice and committed perjury.

• The House began impeachment hearings and passed two articles of impeachment in December. The Senate voted that Clinton was not guilty, but Clinton’s reputation had suffered.

Foreign Policy Events During the Clinton Presidency

• Former president Jimmy Carter convinced military rulers in Haiti to step aside, thereby avoiding a military confrontation?

• The agreement reached between Israeli Prime Minister Yitzhak Rabin and Palestinian Liberation Organization leader Yasir Arafat in 1993 included the PLO recognized Israel’s right to exist, and Israel recognized the PLO as the representative of the Palestinians.