The political failure of the Bush presidency, defined by Bush's loss in the 1992 election, was entirely in the realm of domestic affairs and may well have been beyond Bush's power to prevent. There had been a sharp recession at the beginning of the Reagan years, with almost 10 percent of the workforce unemployed. But since 1983 the nation's economy had enjoyed extraordinary growth. A cyclical correction was overdue. Growth slowed in 1989 and 1990 and then stopped in 1991. Unemployment rose from 5.3 percent in 1989 to 7.4 percent in 1992. The start of a recovery in late 1992 was not vigorous enough to reduce unemployment and came too late to help Bush at the polls.
Against this economic background, Bush had the political problem of facing a Congress controlled, in both Senate and House, by the opposition party throughout his four years. Other recent presidents—Truman, Eisenhower, Nixon, Reagan—faced a similar problem but encountered less difficulty than Bush. One tactic, used successfully by Truman and Reagan, was to build such popular support for a clear program that members of Congress either cooperated or faced a loss at the next election. Another tactic, mastered by Nixon, was to win support across party lines with a subtle combination of punishments and rewards.
Bush tried neither. He had no compelling program on which to build popular support, and he lacked the taste or talent for bargaining and mutual accommodation. Again, Bush was above all a foreign policy president. His friends and critics agreed on his lack of passion and leadership in domestic affairs. Although he had run for the Senate and served four years in the House, he had few close friends in the legislature. His key advisers on domestic affairs saw Congress as an obstacle, not a difficult partner with whom it was necessary to reach an understanding. Instead, as one analyst of his presidency has written, Bush tried to govern without Congress.
Bush's principal tool was the veto. Under the Constitution the president must sign bills passed by Congress to make them into law. If he disapproves of the legislation, he may refuse to sign it and send Congress a veto. Both houses of Congress need a two-thirds majority to override a presidential veto. Bush wielded the veto successfully forty-three out of forty-four times. The only veto to be overridden, on 5 October 1992, was legislation to regulate the cable television industry. Bush said the law would increase rather than reduce the cost of cable TV to the consumer.
Most of the important successful vetoes reflected Bush's opposition to expanded government regulations and were favorable to business. For example, his first veto, on 13 June 1989, blocked a congressional effort to raise the minimum wage from $3.35 (where it had stood since 1981) to $4.55. Congress offered a compromise at $4.25, which Bush then signed. Bush also vetoed, on 21 June 1990, a bill to require most employers to permit employees to have up to twelve weeks of unpaid leave to care for newborn, recently adopted, or ill children, without risking their job security. Bush said such matters were best left to negotiation between workers and management and that the bill would create "rigid, federally imposed requirements." In October 1991, with unemployment rising, Bush vetoed a bill to extend federal unemployment benefits, saying it would add to the budget deficit.
His most conspicuous veto was exercised against the civil rights legislation of 1990. Recent Supreme Court decisions had narrowed the ability of employees to win redress from employers for discrimination on the grounds of race, sex, religion, and national origin. The Democratic Congress proceeded to strengthen the legislation. Bush's veto message argued that the proposed law would force employers to set quotas in hiring in order to protect themselves from lawsuits. The president said he was all for affirmative action, but vehemently against quotas. He also twice vetoed, as noted above, congressional efforts to deny MFN status to China and a message to restrict textile imports.
Another technique used by Bush to work around Congress was to restrict or eliminate federal regulations on environmental and occupational safety matters deemed burdensome to business, and generally to interpret the will of Congress in the narrowest possible way. A key adviser in this effort was White House counsel Boyden Gray, a lawyer adept at finding ways to reshape the meaning of laws. Another technique was the vigorous use of the Council on Competitiveness headed by Vice President Quayle. The mandate of the Quayle council was to review all federal regulations affecting business and strike down regulations whose cost to business was deemed to exceed the benefits derived. Business interests were invited to appeal directly to Quayle for help.
Bush did work with Congress in passing two major pieces of legislation, both in 1990: the Americans with Disabilities Act and the Clean Air Act. The first required businesses, schools, and public institutions to install facilities providing full access to people in wheelchairs and with other disabilities.
In supporting the Clean Air Act, Bush was acting, to use his own words, as an "environmental president." President Reagan, showing little anxiety over alleged threats to the environment, had for eight years blocked any strengthening of 1977 clean air legislation. The quality of the nation's air had improved little, if at all. Acid rain, caused by smokestack emissions and urban smog from automobiles, was harmful to plants and human beings. Bush agreed something had to be done. He did not accept the sweeping proposals of some members of Congress, but settled for new pollution controls on automobile exhausts and required industry to meet deadlines for the reduction of damaging emissions. The implementation of environmental regulations, however, involved a constant struggle between William Reilly, the administrator of the Environmental Protection Agency, and more conservative, business-oriented members of the administration like Chief of Staff Sununu and Vice President Quayle.
It was not easy for Bush to be simultaneously an environmental president and the protector of business from federal regulations. For example, at first he came out against attending the United Nations Conference on Environment and Development, popularly called the Earth Summit, scheduled for June 1992 in Rio de Janeiro, Brazil. "I am not going to the Rio Conference and . . . sign an agreement that does not protect the environment and economy of this country," he said. In the face of an environmentalist outcry Bush did attend the conference, though the United States refused at Rio to support the Biodiversity Treaty to protect endangered species, because Bush believed it would place undue burdens on American business.
Bush's biggest problem with Congress was the deficit in the federal budget, the gap between revenue and expenditures. The deficit in 1980, Jimmy Carter's last year as president, had been $73.8 billion. By Reagan's last year, 1988, it had doubled to $155 billion. Deficits must be met by borrowing, and borrowing produces a national debt. The debt under Carter was $914 billion. By 1988 it had tripled—requiring more than $200 billion per year just to pay the interest. Bush agreed with his budget director Richard Darman that the deficit and the debt were a serious drag on the American economy, depressing productive investment, costing jobs, weakening the nation's ability to compete for world markets.
But what to do? A deficit can be closed only by reducing expenditures or increasing revenue (taxes), or some combination of the two. Bush had a quadruple problem. First, he had pledged "no new taxes" during the 1988 campaign, and most Republicans were determined to hold him to the pledge. Second, expenditures were rising rapidly because of interest payments, a commitment made in the Reagan administration to bail out failed savings and loan institutions, and the escalating cost of payments under Social Security, Medicare, and other government "entitlement" programs. Third, the Democratic Congress was loath to cut entitlements but welcomed the opportunity to embarrass Bush with new taxes. And fourth, the economy as a whole went into mild recession in 1990 and 1991. Unemployment rose and wages stagnated. A popular anti-Bush bumper sticker in the spring of 1991 read "Saddam Hussein has a job. Have you?" Bush's dilemma was that he believed the long-term health of the economy required a reduction in federal spending—a measure that in the short term could mean higher unemployment.
Bush kept his pledge on no new taxes in 1989. The budget agreement reached that year kept things as they were: rising expenditures, rising debt, no new taxes. But in 1990 Bush decided to abandon his pledge as part of a comprehensive deal with Congress. He and his staff engaged Congress in prolonged negotiation aimed toward a mix of higher taxes and a substantial cut in expenditures. Representative Dan Rostenkowski of Illinois, the Democratic chairman of the House Ways and Means Committee, was the principal negotiator for Congress. Conservative commentators and some disillusioned members of his own staff believed that Bush was taken to the cleaners by Congress. Under the 1990 budget act taxes went up slightly, but cuts in spending were largely promises for the future. As a result, expenditures continued to grow faster than revenue, the deficit remained high (reaching $290 billion in 1992), and the national debt at the end of Bush's term exceeded $4 trillion.
Bush failed to persuade Congress to enact his favorite economic measure: a reduction in the capital gains tax, the tax incurred when stocks or other assets are sold for more than what they were purchased for. The president argued that a high capital gains tax prevented investors from taking the kind of risk necessary for economic growth and from redirecting funds from old investments to new, more productive ones. He also claimed that a lower capital gains tax would actually mean more government revenue because investors would be more likely to sell stocks when their tax on profits was low, rather than hold onto them and not pay any tax at all. The Democratic-controlled Congress blocked a capital gains tax cut and called it a measure to benefit only the rich—since poor people had no investments and thus no hope of capital gains.
Bush alienated some conservatives by agreeing to new taxes, but he leaned their way on a cluster of noneconomic issues, such as abortion. After the Supreme Court in Webster v. Reproductive Health Services (1989) extended the power of a state government to restrict abortions, those who believed in a woman's right to choose ("pro-choice") mobilized. The Democratic Congress, with pro-choice majorities, then attempted to strike down existing bans on the use of federal funds for abortions or abortion-related activities. Four times Bush vetoed bills with pro-choice provisions.
Another controversial issue was gun control. Here Bush took a middle-of-the-road position. He declared his strong conviction that Americans had a constitutionally guaranteed right to bear arms and his belief that legislation could do little to keep guns out of the hands of criminals. Better, he said, to deal with crime through longer, tougher prison sentences. On the other hand, he supported restrictions on the importation of certain kinds of automatic weapons unsuitable for sporting purposes.