UNITED STATES HISTORY
The New Millennium
*In 2000, George W. Bush, son of former President George H. W.
Bush, ran for president against Clinton's vice-president, Al Gore,
junior. Bush claimed he would restore dignity and morality
to the office of the presidency. Gore was hurt among
conservatives by the moral scandals of Clinton's presidency, but
alienated liberals by distancing himself from Clinton, who was
still popular with many Americans.
*The Election of 2000 was very close, ultimately being decided by
Florida, where the vote was also so close that the election came
down to a few hundred votes, and some counties ordered a recount
of their ballots. Overall, about 70,000 votes were disputed,
partly due to ballots that were hard for voters to read, and had
to be recounted by hand. When this began to take too long,
and the Florida Supreme Court extended the deadline, Bush went to
the Supreme Court to have the recount stopped, and it was in the
case of Bush v. Gore, allowing Florida to certify Bush as
the winner by 537 votes. At the time, many people viewed
this as the Supreme Court (which had more justices appointed by
Republicans than by Democrats) deciding the election.
*Many Democrats blamed this loss on mistakes made by voters who
could not properly fill out the “butterfly ballots” used by some
counties or by Ralph Nader's 97,488 votes for the Green Party
taking the state away from Gore. Later, several non-binding
recounts were held using different standards, and under most--but
not all--of them, Bush won.
*The first crisis of Bush's presidency was the bursting of the
'dot-com bubble,' when the stocks of internet companies that had
seen excessive speculative investment crashed in April,
*The internet was a product of the Space Race, as ARPA (the
Advanced Research Projects Agency, created in 1958, looked for a
way to decentralise the government's computing power, so it could
not be destroyed by a single nuclear strike. After years of
research, the first two computers of ARPAnet were connected on 29
*For years, the internet was mostly used by the military and
universities, primarily by researchers. However, as time
passed, other students and professors began to use it for
communication through electronic mail, chat, and message
boards. Some primitive text-based games were even
created. Still, the internet did not spread much beyond
specialised users until the creation of the first web browser in
1990, allowing web pages (at first still text, but soon including
pictures and even music) to be hyperlinked to each other, creating
the World Wide Web (which is not the entire internet--that
consists of all computers linked together, even those that
communicate other ways). Even then, the internet only became
widely used with the rise of services such as CompuServe which
charged an hourly fee and later America On-Line which allowed
people to pay a monthly fee to connect to their servers and use
their software to explore the internet. At first, most such
services limited their users to their own programmes, message
boards, and sometimes even e-mail.
*AOL first began to let its members use other services in
September, 1993, opening the internet to everyone.
Furthermore, the first web browser with a graphical user interface
(rather than just typing text) was released in 1993, making the
World Wide Web easier to use and capable of easily integrating
images and music into web pages.
*The rapid growth of the internet in the 1990s was possible thanks
to the advent of the personal computer in the 1970s. Soon
the PC market was dominated by Bill Gates, founder of Microsoft,
and Steve Jobs, founder of Apple Computers, which released the
Macintosh in 1984, the first computer to have a graphical user
interface, which was later copied by Microsoft Windows in
1990. In the 1990s, Microsoft dominated the PC market,
eventually being the focus of anti-monopoly lawsuits in
1998. Apple tried to regain their dominance by selling
computers that could run programmes made for Windows and by
bringing back Steve Jobs, who would help design more stylish
computers and other devices such as the iMac (1998), iPod (2001),
iPhone (2007), and iPad (2010).
*By the year 2000, about half of Americans used the internet, and
on-line shopping was becoming a big part of the economy.
Credit for this sometimes goes to Jeff Bezos, founder of
Amazon.com, which first went on-line in 1995 as an on-line book
store, but later expanded to sell many more products and
eventually even create its own. It was one of the major
companies to survive the dot-com crash of 2001, and is now by far
the largest on-line retailer in America.
*The ease of storing and sharing information on computers and
especially the internet created an Information Revolution in
America and around the world.
*The second crisis of Bush’s presidency, and the one that would
define it, was the terrorist attack on September 11th, 2001.
*In 2001 Osama bin Ladin and al-Quaeda executed the September 11th
attacks on the United States, killing 2,986 people. In
response, the USA and NATO invaded Afghanistan, whose repressive
government, the Taliban, had supported al-Quaeda.
*The war in Afghanistan was quick and successful, although the
occupation has been difficult, partly because the initial success
seemed so great that Afghanistan soon largely was ignored in
favour of other military commitments. Many local warlords
remain powerful (and often fund their activities through the opium
trade). The government created by the United States is often
corrupt and politics tend to be based on tribal loyalties and the
*To try to detect future terrorist activities, in October 2001,
Congress passed the PATRIOT ACT, allowing increased government
surveillance of telephone, e-mail, and financial records without a
court order, some types of searches without a warrant, and
indefinite detention of non-citizens suspected of planning
*Starting in 2002, some suspected terrorists viewed as
particularly dangerous were imprisoned in Guantanamo Bay, Cuba,
without normal criminal procedures or protections of US
laws. There have been accusations of mistreatment of
prisoners there, and President Obama transferred many of the
prisoners to other facilities, but some remain.
*In 2003, the US government was concerned that Iraq had aided or
was aiding al-Quaeda and other terrorist groups. Throughout
the 1970s, 80s, and 90s, many Middle Eastern countries had
training camps for terrorists, or actively sponsored terror.
Libya and Syria were especially well-known for that, but Iraq had
been involved somewhat as well. However, Osama bin Ladin
hated Saddam Hussein for being a secular rather than religious
leader. There also seemed to be evidence that Iraq was still
producing chemical weapons and other Weapons of Mass Destruction,
despite agreeing to give them up after the first Gulf War (in
fact, none were ever found after the invasion of Iraq).
*In March, 2003, American, British, and other troops invaded Iraq
in Operation Iraqi Freedom, rapidly overthrowing Saddam Hussein
(who went into hiding but was eventually found and
executed). At the time, a group known as neoconservatives
(or neocons) whose philosophy dated to the Vietnam War era (or
arguably earlier, at least to Wilson’s Moral Diplomacy), believed
that with sufficient help, dictatorships could develop into
democracies and that the United States had a duty to try to bring
“peace through strength” to oppressed peoples. The US did
help to create a democratic government in Iraq, although one that
has had its share of problems.
*Many other countries doubted the justification of this invasion,
and criticised the United States, most famously France, which led
some Americans (including the Congressional cafeteria) to rename
French Fries to Freedom. French’s mustard issues a press
statement saying the only thing French about them was their name.
*Furthermore, after the US invasion of Iraq, al-Quaeda became
increasingly involved in the area. This was partly because
once democracy was allowed in Iraq, the Shia majority elected
leaders who often favoured members of their own religious group
and discriminated against Sunni Muslims, who had previously been
in charge of Iraq. Many Sunnis came to support al-Quaeda or
otherwise oppose the US and the Iraqi government. On the
other hand, Kurds in Northern Iraq were largely left alone and
developed a relatively stable and prosperous society.
*In 2007, President Bush announced the beginning of a troop surge
in Iraq, vastly increasing the number of American troops involved
in Iraq (which was important, as many other countries, including
Britain, were withdrawing their troops). During the surge,
the US military began to work more closely with some local Sunni
leaders, some of whom were unhappy with the extreme nature of
al-Quaeda, and together American and Iraqi forces were able to
bring about a great reduction in violence in Iraq.
*This reduction in violence, along with American weariness with
the war, a change in administration with the election of Barrack
Obama, and the request of the Iraqi government, led to the
withdrawal of American troops from Iraq in 2011.
*One thing that made the wars in Afghanistan and Iraq different
from the Vietnam War and other twentieth-century wars was that
there was no draft. Among other things, this resulted in a
heavy reliance on the National Guard who during the Vietnam War
had been kept at home (although many of them were sent overseas
during the World Wars). Many Guardsmen and regular soldiers
ended up serving multiple tours of duty overseas, too, putting
great stress on their families.
*Furthermore, there was no rationing, as there had been during
World War II, nor did taxes go up (the national debt vastly
increasing to pay for the war instead), so the average American
was not touched much by what became the longest period of overseas
conflict in American history.
*The third crisis of President Bush’s administration came early in
his second term in August 2005, when Hurricane Katrina hit the
Gulf Coast, particularly New Orleans (which was almost entirely
flooded, as most of the city is below sea level). This was
the most destructive hurricane in American history to that point
in terms of property damage (it has since been approximately
equalled by Hurricane Harvey in 2017), and one of the
deadliest. Local governments did not handle the hurricane
well in its early days, and the federal government seemed slow to
respond to the crisis, too, which led to significant criticism of
President Bush’s administration.
*Many American oil refineries and ports through which oil is
imported are located on the Gulf Coast, too, and Hurricane Katrina
shut down many of these, leading to brief gas shortages and a
significant increase in gas prices, which rose over $4 in some
places. These increased fuel costs hurt the economy,
contributing in a small way to the financial problems that would
strike the country a few years later.
*The final crisis of Bush’s presidency came in 2007 and 2008, when
the economy crashed in the worst recession since the Great
Depression. This, however, had roots going back about a
*In 1992, a Democratic Congress passed, and President George H. W.
Bush signed, a law requiring Fannie Mae and Freddie Mac, two
independent, but government-backed, mortgage companies to make
more loans to low-income borrowers, even if that involved making
loans to people who were higher credit risks. This practise
would increase as the 1990s continued under pressure from the
*In 1999, a Republican Congress and President Clinton repealed
parts of the Glass-Steagall Act allowing single financial
institutions to again take part in retail banking, investment
banking, and insurance, and many large banks began doing so on
their own or merging with other banks so that they could.
*Furthermore, during the good economic times of the late 1990s and
early 2000s, many banks began lowering requirements for credit
cards and for home loans, both giving loans to people with bad
credit (known as sub-prime loans) as well as requiring low (or no)
down payments from borrowers. Some banks even made 103%
loans to cover closing costs.
*As it became easier to buy a house, more people bought them and
house prices went up. As house values increased, some people
took out additional mortgages against houses that were now worth
much more than they had paid for them.
*Banks were not too worried, as many of them re-sold the sub-prime
loans they made in large groups of loans to investment banks while
also insuring those blocks of loans against their collapse.
In turn, more and more investment banks began speculating in home
*However, as people with poor credit proved unable to repay their
loans, it began to hurt investment banks and insurers. As
more and more homes went into foreclosure starting around 2006,
house prices began to fall and people found they owed more on
their houses than they were now worth. Furthermore, banks
became reluctant to lend money, and by 2007, credit had largely
*In 2008, Lehman Brothers, the fourth-largest bank in the United
States at the time, weighed down by sub-prime mortgages, declared
bankruptcy, and this is often considered the start of the Great
Recession, although house prices had been falling for a year or
two by that point.
*The US government, worried that more banks would fail, began
lending money to major banks in a so-called Bank Bailout.
However, little was done to help individuals hurt by the
recession, leading to a backlash against the government that was
eventually, partly, organised as the Tea Party movement.
*Under Presidents Bush and Obama, the US government undertook two
stimulus programs. Under Bush, individual and business taxes
were cut and money was lent to banks and bought up bad loans under
the Troubled Assets Relief Program, whereas under Obama,
government spending increased on infrastructure, housing,
research, and other areas. Obama also bailed out General
Motors and Chrysler. Economists are divided on how helpful
either stimulus plan actually was.
*The government also passed the Dodd-Frank Act in 2010 to regulate
banks more strictly, although this was slightly relaxed in 2018.
*An overall collapse of the economy led to rising unemployment,
reaching a peak of 10.1% in October 2009, the worst since the
Great Depression (although unemployment would go up again in 2020,
hitting 14.7% in April of that year). The unemployment rate
was particularly noticeable among men in low-skilled jobs such as
manufacturing and construction—in fact, at one point during the
recession, more women were employed than men for the first time in
*The Great Recession in the US officially ran from December 2007
to June 2009 based on overall growth of the economy.
However, since the recession officially ended, wage growth has
been low in many industries and income inequality has grown, as
most growth has been in jobs requiring higher levels of education
or business connections. Median household wealth fell 35% in
the US, from $106,591 to $68,839 between 2005 and 2011, and took
years to recover (reaching $97,300 in 2016 and finally making it
to $121,411 in 2019).
*In the 2008 presidential elections, the Republicans nominated
Vietnam Veteran John McCain and the second female
Vice-Presidential candidate, Sarah Palin, governor of Alaska,
while the Democrats nominated Barrack Obama, a young Black Senator
from Illinois to run for the presidency (with Joe Biden, a Senator
from Delaware as VP). To a country tired of Bush’s wars and
the Great Recession, he promised Hope and Change.
This page last updated 11 December, 2020.