Chapter 28 (2004–2020)

Chapter Overview and Essential Themes of a Divided Nation (2004–2020)

• General Context: The two decades following the September 11 attacks were marked by continuous political surprises, ending in the highly turbulent year of $2020$.

• Presidential Transitions and Economic Catalysts:     * The second term of George W. Bush collapsed due to the failed Iraq War, the federal response to Hurricane Katrina, and the financial crisis of $2008$.     * The economic crisis, categorized as the worst since the Great Depression, allowed political newcomers Barack Obama ($2008$) and Donald Trump ($2016$) to win the presidency.

• The Obama Era: Barack Obama, the first African American president, symbolized historic change but faced intense conservative opposition. Key milestones included:     * The Affordable Care Act ($2010$) for healthcare expansion.     * The killing of Osama bin Laden ($2011$) in the war on terror.     * The national legalization of same-sex marriage ($2015$).

• Rising Populism and Polarization: Fragmentation deepened through movements like the Tea Party ($2009$) from the right and Occupy Wall Street ($2011$) from the left.

• The Trump Era: Donald Trump ($2017$–$2021$) emphasized immigration restrictions, withdrawal from international agreements, and confrontational rhetoric, further polarizing the nation.

• The Crises of 2020:     * The COVID-19 pandemic caused hundreds of thousands of deaths and economic devastation.     * The murder of George Floyd (May $2020$) triggered the largest racial justice protests in U.S. history.     * The post-election period involved Trump’s refusal to accept results, culminating in the January 6, $2021$, attack on the U.S. Capitol.

• Historical Significance: By the end of $2020$, the U.S. was more divided in political outlook and the understanding of truth than at any time since the American Civil War.

The Collapse of Bush’s Second Term

• The Iraq War’s Continued Failures:     * Bush’s second term began in January $2005$ with eroding support due to the lack of resolution in Iraq.     * Sectarian violence between Sunni and Shia communities escalated into a civil war; American troops faced a sustained insurgency and rising casualty rates.     * Abu Ghraib Prison Scandal (2004): Revealed American soldiers torturing and humiliating Iraqi prisoners, which damaged American moral authority globally.     * The "Surge" (2007): A strategy that increased troop levels to reduce violence. While it achieved temporary stability, it failed to realize long-term goals like a stable Iraqi democracy, weakening Iranian influence, or the total defeat of Islamic extremism.     * Intelligence Failures: The $9/11$ Commission Report ($2004$) documented existing intelligence failures. Subsequent investigations found pre-war intelligence was manipulated, and the discovery that Iraq had no Weapons of Mass Destruction (WMDs) undermined the justification for invasion.     * Political Consequences: By $2006$, a majority of Americans opposed the war. Democrats regained control of Congress in the $2006$ midterms as a rebuke of Bush's policies.

• Hurricane Katrina and Government Failure (August 2005):     * The hurricane devastated the Gulf Coast and New Orleans. The federal levee system failed, flooding approximately $80\%$ of the city.     * Response Failures: Federal response was disorganized and slow. Poor African Americans suffered disproportionately, with thousands stranded in the Superdome and Convention Center without food, water, or sanitation.     * Casualties and Displacement: Approximately $1,800$ people died; hundreds of thousands were displaced.     * Symbols of Incompetence: FEMA Director Michael Brown became a symbol of federal failure, despite Bush's public praise ("Brownie, you're doing a heck of a job").     * Societal Impact: The event highlighted deep racial and class inequalities and led to a collapse in Bush’s approval ratings, particularly among Black Americans.

The Great Recession of 2008

• Origins and the Housing Bubble:     * The crisis was the worst since the Great Depression, peaking in $2006$–$2007$.     * Subprime Mortgages: These were loans given to borrowers with poor credit, often featuring adjustable rates. These were packaged into mortgage-backed securities by financial firms.     * Systemic Failure: As home prices dropped and borrowers defaulted, these securities lost value, causing massive losses for banks.

• Impact of Deregulation:     * Gramm-Leach-Bliley Act (1999): Repealed the Glass-Steagall Act’s separation of commercial and investment banking, allowing banks to speculate with depositor funds.     * Shadow Banking: Investment banks and hedge funds operated without traditional regulations, utilizing complex derivatives like credit default swaps.     * Rating Agencies: Misled investors by giving toxic securities high investment-grade ratings.

• Timeline of Collapse:     * Bear Stearns: Failed in March $2008$; sold to JPMorgan Chase via government arrangement.     * Lehman Brothers: The fourth-largest investment bank declared bankruptcy on September 15, $2008$, triggering global panic.

• Federal Intervention and the TARP Bailout:     * Troubled Asset Relief Program (TARP): Authorized $\$700 \text{ billion}$ in October $2008$ to bail out big banks, AIG, General Motors, and Chrysler.     * Federal Reserve: Lowered interest rates to near zero.

• Human and Global Cost:     * Unemployment rose from $5\%$ to $10\%$ by late $2009$.     * Approximately $8 \text{ million}$ Americans lost jobs; millions lost homes to foreclosure.     * World economies (Europe, Asia, Latin America) contracted, leading the G20 nations to coordinate stimulus spending.     * Public Outrage: Many noted that while the financial industry returned to profitability and bonuses, ordinary Americans received little assistance. This mistrust fueled the Tea Party and Occupy Wall Street movements.

The Obama Presidency: Hope, Change, and Polarization

• 2008 Election Significance:     * Barack Obama, a first-term Senator from Illinois, became the first African American president.     * He defeated John McCain with an electoral vote of $365$ to $173$ and $53\%$ of the popular vote.     * His victory was viewed as a symbol of racial progress, and he received the $2009$ Nobel Peace Prize early in his term.

• Domestic Policy and Recovery:     * American Recovery and Reinvestment Act (February 2009): A stimulus package of approximately $\$787 \text{ billion}$ for infrastructure, state aid, and tax cuts.     * Affordable Care Act (ACA/Obamacare, March 2010): Extended coverage to $20 \text{ million}$ uninsured people. It prohibited denials for pre-existing conditions and established health insurance exchanges.     * Political Conflict: The ACA passed with zero Republican support and faced legal challenges. In NFIB v. Sebelius ($2012$), the Supreme Court upheld the individual mandate but allowed states to opt out of Medicaid expansion ($14$ states did so).

• Foreign Policy:     * Iraq and Afghanistan: Withdrew combat forces from Iraq (December $2011$) and reduced Afghan deployments.     * Osama bin Laden: Authorized the Navy SEAL raid in May $2011$ that killed the Al-Qaeda leader in Pakistan.     * Iran Nuclear Agreement (JCPOA, 2015): Limited Iran’s nuclear program for sanctions relief.     * Syrian Civil War: Obama avoided direct military intervention despite humanitarian crises, a move criticized by some as allowing disaster and defended by others as avoiding a worse outcome.     * Pivot to Asia: Focused on the Asia-Pacific to balance China’s rising power through the Trans-Pacific Partnership (TPP).

Political Polarization and Populist Movements

• The Tea Party (2009):     * A conservative populist response to bailouts and the ACA. Named after the Boston Tea Party.     * Focused on federal debt, taxes, and government overreach. They pushed the Republican Party to the right and helped the GOP regain the House in $2010$.     * Used obstructing tools leading to the $2011$ debt ceiling crisis and $2013$ government shutdown.

• Occupy Wall Street (September 2011):     * A progressive populist movement targeting economic inequality and corporate influence.     * Slogan: "We are the $99\%$" (referring to the concentration of wealth in the top $1\%$").

• Black Lives Matter (BLM, 2013):     * Formed after the killing of Trayvon Martin; rose to national prominence after Michael Brown’s death in Ferguson ($2014$).     * Focused on police brutality and structural racism.

• #MeToo Movement (2017):     * Sparked by allegations against Harvey Weinstein. Challenged gender power dynamics and sexual harassment in the workplace.

Legal and Cultural Transformations

• Same-Sex Marriage:     * The Defense of Marriage Act was struck down in U.S. v. Windsor ($2013$).     * Obergefell v. Hodges (June $2015$) established a constitutional right to same-sex marriage nationwide.

• Military and Drugs:     * "Don’t Ask, Don’t Tell" was repealed in $2010$.     * Marijuana was legalized for recreational use in Colorado and Washington in $2012$, with other states following.

• Climate Change: Obama joined the Paris Climate Agreement ($2015$) via executive action.

• Demographics and Immigration:     * The $2010$ census showed growing minority populations; non-Hispanic whites were projected to no longer be the majority by $2042$.     * DACA (2012): Provided protection for undocumented immigrants brought to the U.S. as children ("Dreamers").     * Deportations: Obama’s administration deported approximately $3 \text{ million}$ people, the highest in history.

The Trump Presidency and Political Disruption

• 2016 Election:     * Trump defeated Hillary Clinton with $304$ electoral votes to $227$, despite losing the popular vote by approximately $3 \text{ million}$.     * Coalition: Primarily white Americans without college degrees, rural voters, and those in the Rust Belt (Pennsylvania, Michigan, Wisconsin).     * Controversies: Russian interference (hacking and social media manipulation) led to the Mueller Investigation ($2017$–$2019$), which did not establish a criminal conspiracy.

• Domestic Policies:     * Tax Cuts and Jobs Act (2017): Reduced corporate taxes from $35\%$ to $21\%$.     * Judicial Shifts: Appointed three Supreme Court justices: Neil Gorsuch, Brett Kavanaugh, and Amy Coney Barrett.     * Immigration: Implemented travel bans, border wall construction, and a family separation policy.

• Foreign Policy:     * Withdrew from TPP, the Paris Agreement, and the Iran Nuclear Agreement.     * Direct diplomacy with Kim Jong-un (three summits).     * Recognized Jerusalem as Israel's capital and moved the embassy there.     * Abraham Accords (2020): Normalized relations between Israel and several Arab states.     * Iran Escallation: The killing of General Qassem Soleimani in January $2020$ brought the U.S. and Iran close to war.

2020: The Year of Multiple Crises

• COVID-19 Pandemic:     * Reached the U.S. in January $2020$; widespread lockdowns began in March.     * GDP contracted at an annual rate of $32\%$ in Q2 $2020$. Unemployment hit $14\%$     * CARES Act (March 2020): Provided $\$2.2 \text{ trillion}$ in stimulus.     * Medical Impact: Over $350,000$ Americans died by the end of $2020$ (eventually exceeding $1 \text{ million}$).     * Operation Warp Speed: Accelerated vaccine development (Pfizer and Moderna).

• George Floyd Protests:     * Murdered by Officer Derek Chauvin on May 25, $2020$.     * Estimated $15$–$26 \text{ million}$ people participated in demonstrations, making it the largest social movement in U.S. history.

• 2020 Election and Capitol Attack:     * Joe Biden defeated Trump with $306$ electoral votes and $81 \text{ million}$ popular votes.     * Kamala Harris became the first woman, first African American, and first Asian American Vice President.     * The "Big Lie": Trump claimed the election was stolen without evidence, leading to the January 6, $2021$ Capitol attack where five people died.

Key Terms and Definitions

• Hurricane Katrina (2005): Devastated Gulf Coast; revealed government failure; destroyed Bush approval.

• Abu Ghraib: American torture of Iraqi prisoners; damaged moral authority.

• Subprime Mortgages: Loans to risky borrowers; central to housing bubble.

• Lehman Brothers (Sept 2008): Investment bank collapse; triggered financial panic.

• TARP (2008): Troubled Asset Relief Program; $\$700 \text{ billion}$ bailout.

• Great Recession (2008-2009): Worst economic crisis since Great Depression.

• NFIB v. Sebelius (2012): Supreme Court upheld ACA's individual mandate.

• 99% / 1%: Occupy Wall Street slogan regarding income inequality.

• DACA (2012): Deferred Action for Childhood Arrivals; protection for Dreamers.

• Operation Warp Speed: COVID-19 vaccine development program.

• Big Lie: Trump's claims of stolen $2020$ election; no evidence.