Bush became the first Republican president since the 1950s to enjoy a majority in both houses of Congress. Among the initial domestic challenges that faced the Bush administration were a weakening national economy and an energy crisis in California. Bush, who had campaigned as a “compassionate conservative,” promoted traditionally conservative policies in domestic affairs, the centrepiece of which was a $1.35 trillion tax-cut bill he signed into law in June 2001. That month, however, Republican Sen. Jim Jeffords became an independent, giving the Democrats control of the Senate. Subsequently Bush encountered strong congressional resistance to some of his initiatives, such as an educational voucher program that would provide subsidies to parents who send their children to private schools, the creation of a nuclear missile defense system, and federal funding for selected social programs of religious groups. In foreign affairs, the administration attempted to liberalize U.S. immigration policy with regard to Mexico, with which it struck closer ties. But it faced sharp criticism from China for its outspoken support of Taiwan and from Europe and elsewhere for its abandonment of the Kyoto Protocol, a 1997 treaty aimed at reducing the emission of greenhouse gases, and for its declared intention to withdraw from the 1972 Treaty on the Limitation of Anti-Ballistic Missile Systems (it formally withdrew from the treaty in 2002).
In 2002 the U.S. economy worsened, as consumer confidence and the stock market continued to fall and corporate scandals dominated the headlines. Nevertheless, Bush remained popular, and he led the Republican Party to majorities in both the House and Senate in the midterm elections of 2002.
Despite the economic difficulties, foreign affairs continued to dominate the Bush administration’s agenda. In 2002 Bush focused world attention on Iraq, accusing Saddam Hussein’s government of having ties to al-Qaeda and of continuing to possess and develop weapons of mass destruction, contrary to UN mandates. In November Bush’s secretary of state, Colin Powell, engineered a UN Security Council resolution authorizing the return of weapons inspectors to Iraq. Soon thereafter Bush declared that Iraq was in breach of the new resolution for its failure to cooperate fully with the inspectors. In mid-March, declaring that diplomacy was at an end, he issued an ultimatum giving Saddam 48 hours to leave Iraq or face removal by force (though he indicated that, even if Saddam chose to leave, U.S.-led military forces would enter the country to search for weapons of mass destruction and to stabilize the new government). On March 20 (local time), following Saddam’s public refusal to leave, the United States and allied forces launched an attack on Iraq, called Operation Iraqi Freedom.
