The traumatic events of the 1970s--Watergate, stagflation, the energy crisis, the decline of American industry, the defeat of South Vietnam, and the Iranian hostage crisis--produced a severe loss of confidence among the American people. Americans were deeply troubled by the relative loss of American strength in the world; the decline of productivity and innovation in American industry; and the dramatic growth of lobbies and special-interest groups that seemed to have paralyzed the legislative process. Many worried that too much power had been stripped from the presidency and that political parties were so weakened and Congress so splintered, that it was impossible to enact a coherent legislative program.
Ronald Reagan capitalized on the public's frustration. When he ran for the presidency against Carter in 1980, he asked Americans, "Are you better off than you were four years ago?" With annual inflation at 18 percent, the answer was a resounding "No." Reagan won a landslide victory, carrying 43 states and almost 51 percent of the popular vote compared to Carter's 41 percent. In addition, the Democrats lost the Senate for the first time since 1954.
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