At the end of the twentieth century and the beginning of the twenty-first, the United States became increasingly tied to a worldwide network of economic, financial, and demographic relationships that increased both the nation's diversity and its interdependence. Immigrants from all over Asia, as well as both legal and illegal immigrants from Mexico, Cuba, and Central America, created a wide variety of new immigrant cultures in both urban and rural areas across the United States. Regional conflicts across the world initially replaced the cold war as a top foreign policy dilemma, but the attacks of September 11, 2001 made terrorism and the regimes of Afghanistan and Iraq the nation's primary concern. Domestically, President Clinton faced an increasingly hostile Congress that attempted to thwart much of his legislative agenda, while President George W. Bush pushed many of his programs through a largely cooperative Congress until becoming bogged down in an invasion and occupation of Iraq that became increasingly controversial and unpopular.

The New Immigration

During the 1990s, the issue of immigration returned to the forefront of American politics. As a result of the Immigration Act of 1965, immigration had taken on a new look. During the last years of the century, immigrants from all over the Asian continent came to America in large numbers, as did new and even larger numbers of both legal and illegal immigrants from Mexico, Cuba, and Central America. About seven million legal and illegal immigrants arrived in the U.S. between 1975 and 1995. Because of new and faster means of transportation and communication, these most recent immigrants have found it much easier to maintain cultural links with their countries of origin than immigrant groups of America's more distant past. The global nature of immigration also reshaped the religious faiths of America because immigrants brought with them not only their own brands of Christianity and Judaism but also Buddhist, Hindu, and Islamic beliefs.

The Clinton Presidency: Managing a New Global Order

President Clinton presented an extremely ambitious agenda upon taking office. He pledged to revive the economy and shrink the federal deficit. He called for reform of the welfare and health-care delivery systems as well as measures to reduce the increasing violence that had turned some urban neighborhoods into war zones. This program faced immediate difficulties because of growing Republican strength in Congress. Clinton's enemies disliked his politics, but his known moral lapses and assorted accusations of additional misbehavior created the deepest resentment among Republicans. The Whitewater real estate scandal and the president's alleged numerous sexual affairs kept his Republican foes busy digging for additional incriminating evidence, but during his first term in office independent investigations produced no evidence of wrongdoing against him.

While he intended to focus primarily on domestic issues, Clinton was compelled to involve the United States in a number of regional crises throughout the world. These conflicts had their origins in ethnic and nationalist movements in Eastern Europe, sub-Saharan Africa, and the Caribbean. By using American power in a limited and conservative manner, Clinton gained considerable public support for the way he handled these situations. Clinton also attempted, without a great deal of success, to find a lasting peace in the troubled Middle East.

The Clinton Presidency on Trial

Throughout Clinton's presidency, the nation experienced a powerful economic expansion. Economic prosperity was the key to Clinton's popularity during a period when the Republicans recaptured small majorities in Congress. Despite this popularity, conservative leaders stymied much of his legislative agenda, and the scandal of an extramarital affair with Monica Lewinsky further damaged his credibility. The president did experience some legislative successes, particularly with Congress's approval of the North American Free Trade Agreement (NAFTA) and with his welfare reform package. Clinton also successfully created economic growth without inflation and reduced the deficit, so that by 1998 the government actually had a budget surplus.

The Monica Lewinsky scandal, in which the president at first lied about and then admitted to a sexual relationship with the young White House intern, almost entirely consumed the first half of Clinton's second term. Based upon the president's own testimony before a grand jury, special prosecutor Kenneth Starr recommended to the House of Representatives that they impeach the president on the grounds of perjury, obstruction of justice, and witness tampering. The Republicans pressed the attack and, despite a general public that opposed impeachment, the House, along strict party lines, voted three articles of impeachment against Clinton. After a month-long hearing, the Senate voted to acquit the president. While the impeachment controversy left the president weakened, the scandal seemed to have little impact on the country. The economy remained remarkably strong with a rate of unemployment at a 30-year low and a stock market soaring.

In the 2000 presidential election, Vice President Al Gore faced Texas governor George W. Bush, the son of Clinton's predecessor. Gore entered the race with a substantial lead, but by election night the race became too close to call. Ultimately, the decision rested on the state of Florida, where voting irregularities led the two sides to contest the election in court. After the state Supreme Court ruled in favor of a recount requested by Democrats, the U.S. Supreme Court reversed the decision and let the election results in favor of Bush stand.

The United States in a Networked World

At the end of the twentieth century Americans had become linked to a global communications network that included personal computers, cell phones, pagers, and many other electronic devices and gadgets that provided almost instant contact with a wider world. Many of these innovations emerged as a result of a technological revolution in microchip technologies. In 1998, electronic commerce generated nearly a half-million jobs. The benefits of this technology-driven prosperity, however, did not distribute evenly within American society. Education proved the most significant determining factor in who would benefit from the computer economy. Most semi-skilled and unskilled workers in the U.S. saw little growth in their earnings in the 1990s. The spread in incomes in the U.S. widened significantly as well during this decade. The highest-paid Americans saw their pay grow twice as fast as that of the middle class.

Multiculturalism and Contested American Identity

During the 1990s, the new multicultural and global complexion of late-twentieth-century America became fully evident. The battles over race, immigration, and multiculturalism suggest that in an era of internationally-linked economies and global migrations, the United States remains a nation of nations struggling to accommodate distinctive identities along lines of race, ethnicity, and national origins. Friction with more established groups sometimes resulted in violence. The issues of racial prejudice and minority poverty still troubled the nation. The Supreme Court has significantly limited the use of affirmative action quotas, though still allowing them in some cases. Incidents of violence and racism troubled even normally tolerant college campuses. Social and political stability thus hinged, as in the past, on accommodating the need of a wide variety of Americans to gain access to the mainstream of American life.

Terrorism in a Global Age

The terrorist attacks of September 11, 2001, have made accomplishing that goal even more complicated. The hijacking of three planes by al Qaeda for use as weapons to attack the World Trade Center and the Pentagon left approximately 3,000 people dead and the nation badly shaken. The attacks energized the previously foundering administration of President Bush, whose partisan conservative agenda was bolstered by Republican control of Congress and the appointment of two more conservative justices to the Supreme Court.

At home, the president pursued an agenda that included seeking new ways to increase production rather than conservation of energy, and an ambitious educational program called No Child Left Behind that the administration failed to fully support financially. A series of "faith-based initiatives" that provided public funding to churches involved in education and social work pleased the evangelical wing of the Republican base but left many other Americans concerned about blurring the line separating church and state. In foreign affairs, even before the September 11th attacks, the president adopted a unilateral approach that alienated many other nations.

After the September 11th attacks, however, a previously unenthusiastic international community rallied to support the president and the United States. The global pressures that had led to the rise of terrorist movements resulted in a threat that could (and did) result in attacks in nations across the globe. Utilizing weapons and training they had received during the cold war, groups such as al Qaeda created a global terrorist strategy motivated by religious values derived from an extremely conservative reading of sacred Muslim texts.

The Bush administration's offensive against terrorism began in October 2001 with an invasion of Afghanistan, whose leaders had refused to expel Osama bin Laden and other terrorists harbored within their borders. Fears of further terrorism at home fueled by an anthrax virus scare led to the implementation of the USA Patriot Act, a law that broadly expanded government powers to investigate private citizens' activities to further the cause of fighting terrorism. The successful routing of the Taliban in Afghanistan (which did not include capture of bin Laden) led the president and his allies to turn their attention to Iraq. Despite the weakness of evidence that connected Iraqi leader Saddam Hussein to al Qaeda, the president with the support of Congress successfully formulated a new doctrine of preemption that enabled him to invade Iraq in 2003.

The initial invasion of Iraq succeeded with remarkable speed and precision, but the occupation of the conquered nation proved far more difficult than the administration had foreseen. Administration missteps and the lack of any discovery of a connection between Hussein and al Qaeda raised opposition at home, although not enough to prevent Bush from winning re-election over Senator John Kerry in 2004. After the election, however, the continuing strength of the insurgency, revelations of atrocities such as the torture of prisoners at Abu Ghraib prison, and the administration's continuing intransigence in the face of growing evidence of the failure of their policies rapidly diminished the president's popularity. The president's seeming callousness in the face of the disaster along the Gulf Coast of the United States caused by Hurricane Katrina in September 2005 further alienated the American public. By the fall of 2006, the transformation of the insurgency in Iraq into a civil war cemented the collapse of what had previously seemed impregnable Republican majorities in both houses of Congress. The apparent overreaching of American power in Iraq appeared to have once again established the limits of American power in an increasingly global and uncertain world.

The Election of 2008

The 2008 election cycle witnessed a Democratic primary between two nontraditional candidates, Senator Hillary Clinton and Senator Barack Obama. Clinton was initially the favorite, but her campaign underestimated the disciplined campaign of Barack Obama and its ability to raise funds and consciousness by successfully exploiting new technologies including the Internet. Obama's strong margin of victory over the Republican nominee Senator John McCain and his running mate Governor Sarah Palin was in part owed to the sudden financial crisis that threatened to plunge the nation into another Great Depression.

The financial crisis was created when financial institutions began approving imprudent home mortgage loans we now know as subprime loans. In an attempt to limit the risk of these loans, they were bundled with other financial instruments and sold to banks, investment firms, and hedge funds. But the inevitable failure of the subprime loans began a series of failures in the financial services industry. The Bush administration rushed in to save the banking system with massive government loans. It was in this environment the 2008 elections were held.

This was the unstable financial environment in which Barack Obama took the oath of office as the forty-fourth president of the United States. His policy agenda was broad, and his challenges many. His programs to reform healthcare, financial markets, and environmental law were criticized from both the political left and the political right as being both too much and not enough. His $787 billion economic stimulus package that included tax cuts, expanded unemployment benefits, and spending on education, healthcare, and infrastructure passed almost exclusively on a partisan vote, with only three Republican senators supporting it.