Domestic affairs
The U.S. economy had generally performed well since emerging from recession in late 1982, but it slipped into a mild recession in 1990. The unemployment rate rose from 5.9% in 1989 to a high of 7.8% in mid-1991. Large federal deficits, spawned during the Reagan years, rose from $152.1 billion in 1989 to $220 billion for 1990; the $220 billion deficit represented a threefold increase since 1980. As the public became increasingly concerned about the economy and other domestic affairs, Bush's well-received handling of foreign affairs became less of an issue for most voters. Bush's top domestic priority was to end federal budget deficits, which he saw as a liability for the country's long-term economic health and standing in the world. As he was opposed to major defense spending cuts and had pledged not to raise taxes, the president had major difficulties in balancing the budget.
Bush and congressional leaders agreed to avoid major changes to the budget for fiscal year 1990, which began in October 1989. However, both sides knew spending cuts or new taxes would be necessary for the following year's budget to avoid the draconian automatic domestic spending cuts required by the Gramm–Rudman–Hollings Balanced Budget Act of 1987. Bush and other leaders also wanted to cut deficits because Federal Reserve Chair Alan Greenspan refused to lower interest rates and thus stimulate economic growth unless the federal budget deficit was reduced. In a statement released in late June 1990, Bush said that he would be open to a deficit reduction program which included spending cuts, incentives for economic growth, budget process reform, as well as tax increases. To fiscal conservatives in the Republican Party, Bush's statement represented a betrayal, and they heavily criticized him for compromising so early in the negotiations.
In September 1990, Bush and congressional Democrats announced a compromise to cut mandatory and discretionary programs funding while raising revenue, partly through a higher gas tax. The compromise additionally included a "pay as you go" provision that required that new programs be paid for at the time of implementation. House minority whip Newt Gingrich led the conservative opposition to the bill, strongly opposing any form of tax increase. Some liberals also criticized the budget cuts in the compromise, and in October, the House rejected the deal, resulting in a brief government shutdown. Without the strong backing of the Republican Party, Bush agreed to another compromise bill, this one more favorable to Democrats. The Omnibus Budget Reconciliation Act of 1990 (OBRA-90), enacted on October 27, 1990, dropped much of the gasoline tax increase in favor of higher income taxes on top earners. It included cuts to domestic spending, but the cuts were not as deep as those proposed in the original compromise. Bush's decision to sign the bill damaged his standing with conservatives and the general public, but it also laid the groundwork for the budget surpluses of the late 1990s.
The disabled had not received legal protections under the landmark Civil Rights Act of 1964, and many faced discrimination and segregation by the time Bush took office. In 1988, Lowell P. Weicker Jr. and Tony Coelho introduced the Americans with Disabilities Act, which barred employment discrimination against qualified individuals with disabilities. The bill had passed the Senate but not the House and was reintroduced in 1989. Though some conservatives opposed the bill due to its costs and potential burdens on businesses, Bush strongly supported it, partly because his son, Neil, had struggled with dyslexia. After the bill passed both houses of Congress, Bush signed the Americans with Disabilities Act of 1990 into law in July 1990. The act required employers and public accommodations to make "reasonable accommodations" for disabled people while providing an exception when such accommodations imposed an "undue hardship".
Senator Ted Kennedy later led the congressional passage of a separate civil rights bill designed to facilitate launching employment discrimination lawsuits. In vetoing the bill, Bush argued that it would lead to racial quotas in hiring. In November 1991, Bush signed the Civil Rights Act of 1991, which was largely similar to the bill he had vetoed in the previous year.
In August 1990, Bush signed the Ryan White CARE Act, the largest federally funded program dedicated to assisting persons living with HIV/AIDS. Throughout his presidency, the AIDS epidemic grew dramatically in the U.S. and around the world, and Bush often found himself at odds with AIDS activist groups who criticized him for not placing a high priority on HIV/AIDS research and funding. Frustrated by the administration's lack of urgency on the issue, ACT UP dumped the ashes of deceased HIV/AIDS patients on the White House lawn during a viewing of the AIDS Quilt in 1992. By that time, HIV had become the leading cause of death in the U.S. for men aged 25–44.
In June 1989, the Bush administration proposed a bill to amend the Clean Air Act. Working with Senate majority leader George J. Mitchell, the administration won passage of the amendments over the opposition of business-aligned members of Congress who feared the impact of tougher regulations. The legislation sought to curb acid rain and smog by requiring decreased emissions of chemicals such as sulfur dioxide, and was the first major update to the Clean Air Act since 1977. Bush also signed the Oil Pollution Act of 1990 in response to the Exxon Valdez oil spill. However, the League of Conservation Voters criticized some of Bush's other environmental actions, including his opposition to stricter auto-mileage standards.
Bush devoted attention to voluntary service to solve some of America's most serious social problems. He often used the "thousand points of light" theme to describe the power of citizens to solve community problems. In his 1989 inaugural address, Bush said, "I have spoken of a thousand points of light, of all the community organizations that are spread like stars throughout the Nation, doing good." During his presidency, Bush honored numerous volunteers with the Daily Point of Light Award, a tradition that his presidential successors continued. In 1990, the Points of Light Foundation was created as a nonprofit organization in Washington to promote this spirit of volunteerism. In 2007, the Points of Light Foundation merged with the Hands On Network to create a new organization, Points of Light.
Bush appointed two justices to the Supreme Court of the United States. In 1990, Bush appointed a largely unknown state appellate judge, David Souter, to replace liberal icon William J. Brennan Jr. Souter was easily confirmed and served until 2009, but joined the liberal bloc of the court, disappointing Bush. In 1991, Bush nominated conservative federal judge Clarence Thomas to succeed Thurgood Marshall, a long-time liberal stalwart. Thomas, the former head of the Equal Employment Opportunity Commission (EEOC), faced heavy opposition in the Senate, as well as from pro-choice groups and the NAACP. His nomination faced another difficulty when Anita Hill accused Thomas of having sexually harassed her during his time as the chair of EEOC. Thomas won confirmation in a narrow 52–48 vote; 43 Republicans and 9 Democrats voted to confirm Thomas's nomination, while 46 Democrats and 2 Republicans voted against confirmation. Thomas became one of the most conservative justices of his era.
Bush's education platform consisted mainly of offering federal support for a variety of innovations, such as open enrollment, incentive pay for outstanding teachers, and rewards for schools that improve performance with underprivileged children. Though Bush did not pass a major educational reform package during his presidency, his ideas influenced later reform efforts, including Goals 2000 and the No Child Left Behind Act. Bush signed the Immigration Act of 1990, which led to a 40% increase in legal immigration to the United States. The act more than doubled the number of visas given to immigrants on the basis of job skills. In the wake of the savings and loan crisis, Bush proposed a $50 billion package to rescue the savings and loans industry, and also proposed the creation of the Office of Thrift Supervision to regulate the industry. Congress passed the Financial Institutions Reform, Recovery, and Enforcement Act of 1989, which incorporated most of Bush's proposals.
