ShmoopTube

00:04

For all of Reagan's anti-government rhetoric he managed to [Raegan giving a speech]

00:06

outspend all of his predecessors by the time he left office the national debts

00:11

stood at two point six trillion dollars that's three times what it had been in 1980 [Girl counting money]

00:15

not that anyone was counting and then Bush Senior walked in and inherited

00:20

a huge debt and it'd be like a grandad leaving his grandchildren a stack of [Grandad in a rocking chair and kid walks in]

00:24

cable bills instead of college money well despite the massive debt he knew

00:28

he'd be facing in office Bush swore on the campaign trail he wouldn't raise [Bush on a train yelling he will not raise taxes]

00:32

taxes like many conservatives he worshipped at the altar of Reaganomics

00:36

well in his mind low taxes meant prosperity for all in jobs galore in [Bush standing with thumbs up as money rains]

00:40

America every night would be pizza night unfortunately things just didn't

00:44

quite work out that way. Yep Bush did do what he could to resist tax increases [Robots surrounded Bush]

00:49

but in the end it was clear that the budget like a bad toupee needed some

00:54

adjusting one of the first things the Bush administration did was meet with [Bush meeting with all congressional leaders]

00:57

congressional leaders to try and approve a new budget was time to meet his crisis

01:02

head-on however it quickly became clear that this was easier said than done [Car colliding with another car]

01:07

there was a deep divide between the Democrats and Republicans like Grand

01:11

Canyon deep and it was extremely hard for them to see eye-to-eye on much of [Lots of individual eyes]

01:15

anything well by the middle of 1990 Bush was forced to announced a nation it

01:19

seems clear to me that both the size of the deficit problem and the need for

01:23

package can be enacted would require tax revenue increases as much as he wanted

01:28

to keep his promise to the American people Bush knew there would be [A highly populated store]

01:31

repercussions if he did well Congress was less than thrilled about it

01:35

themselves and eventually they were able to reach an agreement even though the [Democrat and Republican shaking hands]

01:39

minority Republican still opposed it well the government would cut spending an

01:43

increase taxes to reduce the federal deficit by over 350 billion dollars by

01:48

1995 what Congress hadn't factored into this new budget was a massive government

01:53

bailout of the Savings and Loan industry well the industry had begun to falter in [Savings and Loan industry building crumbling]

01:57

the 1970s when interest rates were fluctuating alongside the weak economy

02:01

investors put their cash in money market accounts that returned a little higher

02:06

interest on the investment rather than in S&L investments

02:09

while the economy strengthened in the late 1980s these SNL industries did not [man with economy tattoo on chest works out]

02:14

well many of the companies began engaging in a risky investing strategy with the

02:18

illegal activity trying to make up for their faltering profit by Bush's [white ball lands on a roulette wheel]

02:23

presidency many of them were failing like epic failing well Bush enacted a

02:27

huge government bailout to the tune of about 124 billion dollars of taxpayer [Bush giving a speech on the bailout]

02:32

dough hello tax hike! which is a slightly less enjoyable hike than the one you

02:37

might take to look at autumn.. ah yeah [Couple with a dog hiking]

Full Transcript