The Arab Spring, intervention in Libya, and the killing of Osama bin Laden
American foreign policy was tested by the huge changes that were taking place early in 2011 in the Middle East, where popular uprisings led to regime change in Tunisia (see Jasmine Revolution) and Egypt (see Egypt Uprising of 2011) and to widespread demonstrations aimed at achieving government reform throughout the region. Collectively, these events would become known as the “Arab Spring.” When Libyan strongman Muammar al-Qaddafi brutally turned the considerable forces of his military on those rebelling against his rule (see Libya Revolt of 2011), a coalition of U.S. and European forces sought to prevent a humanitarian catastrophe by intervening militarily with warplanes and cruise missiles. On March 27, as the conflict continued, the United States handed over the primary leadership of the effort to the North Atlantic Treaty Organization.
Pres. Barack Obama (seated second from left) and various government officials—including Vice Pres. Joe Biden (seated left), Secretary of Defense Robert M. Gates (seated right), and Secretary of State Hillary Clinton (seated second from right)—receiving updates in the Situation Room of the White House during the Osama bin Laden mission, May 2011.Pete Souza—Official White House Photo
At the end of April the southeastern United States, especially Alabama, was ravaged by a rash of destructive tornadoes and severe storms that left more than 300 dead (see Super Outbreak of 2011).
On May 1 Obama made a dramatic late-night television appearance to announce that U.S. special forces had killed Osama bin Laden, the mastermind of the September 11 attacks of 2001, in a firefight at a fortified compound in Abbottabad, Pakistan. U.S. forces took custody of the body, confirmed bin Laden’s identity through DNA testing, and buried his body at sea.
The debt ceiling debate
In the spring and summer of 2011, the national government faced the possibility of default on the public debt and a downgrading of its credit rating unless Democrats and Republicans could agree on whether and how to increase the congressionally mandated national debt ceiling. That ceiling of $14.29 trillion was reached in mid-May, but, by shifting funds, the Treasury Department was able to push out the anticipated deadline for default until August 2. Although the debt ceiling had been raised more than three dozen times since 1980, House Republicans, responding in large measure to Tea Party initiatives, insisted that the ceiling not be raised unless there were commensurate cuts in government spending. Republican proposals called for from $4 trillion to $6.2 trillion in spending cuts, especially to entitlement programs, including radical overhauls of Medicare and Medicaid. While Democrats also advocated spending cuts, they insisted that Medicare and Medicaid be protected, and they proposed tax increases for the wealthiest Americans as well as an end to tax breaks for some corporations, especially oil companies.
The failed “grand bargain”
Efforts at compromise by the leadership of both parties—including closed-door negotiations led by Vice President Biden and a bipartisan attempt by the “Gang of Six” (three senators from each party)—repeatedly collapsed in partisan rancor. In July Obama and Republican Speaker of the House John A. Boehner, meeting privately, nearly reached agreement on a "grand bargain" that would have included trillions in spending cuts, changes to Medicare and Social Security, and tax reform. The deal fell through near the end of the month, however, when the two could not agree on the level of additional tax revenue to be generated. Media reports indicated that Boehner had agreed to tax revenue increases of $800 billion, but, when Obama asked for another $400 billion, Boehner nixed the deal. In any case, many believed that the speaker would have been unable to win sufficient support for the agreement from House Republicans, who remained adamantly opposed to tax hikes and had passed a bill requiring a cap on spending and a balanced budget.
Nevertheless, as the threat of default grew more imminent, there was increasing consensus in both parties that the debt ceiling should be raised. With a broad agreement seemingly out of reach, compromise appeared to hang on whether the ceiling would be increased in one step (which would extend the limit past the 2012 election) or two (which would raise the issue again sooner). Senate minority leader Mitch McConnell proposed a solution that would allow the president to raise the ceiling provided that two-thirds of both houses of Congress did not vote against that action (that is, not enough votes to override a presidential veto). Senate majority leader Harry Reid advanced a bill that removed tax increases from the equation.
Raising the debt ceiling, capping spending, and the efforts of the “super committee”
On July 31, just two days before the deadline, an agreement was reached by the White House and congressional leaders that called for an increase of about $2.4 trillion to the debt ceiling through November 2012, to be imposed in stages. The agreement provided for an immediate increase of $400 billion, with an additional $500 billion to come after September 2011. This combined initial increase of $900 billion would be offset by budget cuts of some $917 billion that would result from an immediate cap on domestic and defense spending. The deal, which did not provide for tax increases, also stipulated that both houses of Congress had to vote on an amendment to the Constitution requiring a balanced budget. The final bill was approved by the House of Representatives by a vote of 269–161 (with centrists from both parties largely voting for it, while many of those farther on the right and left voted against it) and by the Senate by a bipartisan vote of 74–26. Yet despite these efforts, on August 5 Standard & Poor’s, one of the three principal companies that advise investors on debt securities, downgraded the credit rating of the United States from the top level, AAA, to the next level, AA+.
The bill also created a congressional “super committee” tasked with recommending by the end of November 2011 the measures by which an additional $1.2 to $1.5 trillion would be cut from the deficit over a 10-year period. If the committee had agreed on a set of proposals and had those proposals been approved by Congress, the debt ceiling would have been raised by a commensurate amount. In the event, however, the super committee failed to arrive at a consensus plan, which, according to the stipulations of the bill, triggered some $1.2 trillion in across-the-board cuts (evenly divided between defense and nondefense spending) to be implemented in 2013.
Occupy Wall Street, withdrawal from Iraq, and slow economic recovery
As these events unfolded in the autumn of 2011, another populist movement, this time on the left of the political spectrum, gained steam. Inspired by the mass protests of the Arab Spring and the demonstrations that had occurred in Spain and Greece in response to government austerity measures, a disparate group of protesters calling themselves Occupy Wall Street took up residence in a park near New York City’s financial district to call attention to a list of what they saw as injustices. Among the protesters’ concerns were that the wealthy were not paying what the protesters considered a fair share of income taxes, that more efforts needed to be directed at reducing unemployment, and that major corporations—particularly banks and other financial institutions—needed to be held more accountable for risky practices. The protesters identified themselves as “the 99 percent,” the have-nots who would no longer put up with the corruption and greed that they perceived among “the 1 percent,” the wealthiest Americans. In the succeeding weeks the movement spread to other cities across the country.