Taking office in 1981, Ronald Reagan served two terms as US president. His foreign policy was strongly anti-communist. He pursued the Star Wars space missile defense program and described the USSR as the “Evil Empire.” He sent US troops to Grenada in 1983 to unseat the communist government that had taken control, and officials under his administration supported the anti-communist Contras against the Sandinistas in Nicaragua. Congress eventually passed a law stopping further support of the Contras, but Reagan officials found a way to illegally continue the support by funneling weapons to Iran in the “arms for hostages” scheme. When the Iran-Contra affair was revealed, Secretary of Defense Caspar Weinberger was indicted on five felony charges.

Also during Reagan’s presidency, the Berlin Wall fell in 1989. The USSR itself dissolved on December 25, 1991, and many gave credit for its collapse to Reagan’s commitment to anti-communism and to his aggressive defense spending. Reagan’s domestic policy was focused on promoting family values, deregulation of business, tax cuts, and cutting spending on government programs. “Trickle-down economics” was the belief that tax cuts on businesses and the wealthy will eventually lead to economic improvement for the middle class and the poor.

George H. W. Bush took office in 1989 and served a single term. His policies were similar to those of Reagan. Bush sent US troops into Panama to unseat dictator Manuel Noriega and led a UN coalition into Iraq in the Persian Gulf War (1991) to drive Iraqi dictator Saddam Hussein out of Kuwait. Unlike Reagan, however, and despite campaign promises to the contrary, Bush was forced to raise taxes.

President Bill Clinton, a Democrat, took on issues of healthcare and trade. He signed NAFTA, the North American Free Trade Agreement, and adopted the “Don’t Ask, Don’t Tell” policy in the military in 1993, which allowed homosexuals to serve in the military as long as their sexual orientation was not discussed. Clinton was impeached in 1998 for lying to Congress regarding his affair with an intern. Nevertheless, he avoided removal from office by the Senate.

In Canada, Prime Minister Brian Mulroney held office from 1984 to 1993, leading the Progressive Conservative Party. Mulroney worked with the US on issues such as acid rain and trade, and faced continuing challenges concerning how to integrate the French-Canadian culture of Quebec into the greater society of Canada as a whole. His tax policies were unpopular, and he left office in 1993.

Jean Chrétien’s Liberal government won a landslide victory against the Progressive Conservatives and Chrétien held office as Prime Minister until 2003. In 1995, Quebec held a referendum on secession, but it was narrowly rejected. Dealing with the deficit was a major focus for Chrétien. The Canadian relationship with the US in the early 2000s was not always smooth, and Canada did not join the coalition to invade Iraq during the Second Persian Gulf War.

US interventions in Latin America had done little to alleviate violence and poverty. In Central America in particular, civil war and guerilla violence led to terrible atrocities. Conservatives in the United States such as George H. W. Bush condemned Liberation Theology as Marxist. Yet, between the 1980s and the 1990s, Brazil, Argentina, Chile, El Salvador, and Nicaragua had all transitioned to democratic government.

In Brazil, a military government had seized control in a coup in 1964. The military regime lasted until 1985. In the first democratic elections since 1964, the PMDB was victorious, and Tancredo de Almeida Neves became president. Huge problems including crime, poverty, and inflation faced Brazil. In 1992, President Itamar Franco took office; he appointed Fernando Henrique Cardoso as Finance Minister, and Cardoso put the Real Plan into effect, which stabilized inflation.

However, by 2011, Brazil faced environmental challenges as well as a falling GDP growth rate. In Chile, Augusto Pinochet stepped down in 1990. Chile emerged from its period of military rule with a strongly growing economy, and that growth continued through 1998. Privatization of government enterprises, improvements in education, and judicial reform were high priorities. A recession in 1999 spurred rising unemployment, but by 2003 Chile’s economy was once more growing strongly. Chile’s 1991 Rettig Report (The National Commission for Truth and Reconciliation Report) addressed the human rights violations of the Pinochet regime. Chile has also adopted a policy for reparations to victims of Pinochet’s abuses.

As George H. W. Bush’s son George W. Bush took office as President in 2001, the US faced growing threats. The attack orchestrated by al-Qaeda leader Osama bin Laden on September 11, 2001, soon involved the United States in the challenges of the war on terror, beginning with the war in Afghanistan, which was to become the longest lasting war the United States had yet fought.