END OF THE COLD WARUnit 9: Cold War

Chapter 34 Section 1

Decline of the USSR

◦By 1980, USSR was doing poorly◦1985, Mikhail Gorbachev became leader; promoted perestroika and glasnost◦ Perestroika: “restructuring”; policy intended to radically reform Soviet economy

◦Glasnost: “openness”; policy intended to give more rights and freedoms to the Soviet people and promote a willingness to criticize the USSR to seek solutions

◦Both policies play a large part in the USSR’s collapse

Arms Race Slows

◦Gorbachev and US president Reagan wanted to slow arms

race

◦ Both wanted to reduce military budgets to solve domestic problems

◦ USSR to focus on perestroika; US to focus on debt reduction

◦Gorbachev stopped supporting satellites

◦ Mostly peaceful revolution swept E. Europe, overthrew communist gov’ts

◦Germany reunified 1990

◦USSR dissolved 1991

◦Cold War over

Winds of Change◦ W. European economies mostly recovered by 1980s

◦ 1993, European Union (EU) formed

◦ Established the euro as common currency

◦ Between 2004-2007, twelve E. European countries joined

◦ Reunified Germany became leading power in Europe

◦ In the US, spending increased from $631 billion to >$1 trillion under

Reagan; debt tripled

◦ George HW Bush became president, unable to deal with debt; allowed Clinton to win in 1992

◦ 1993: US, Canada, Mexico signed North American Free Trade

Agreement (NAFTA)

◦ Made trade easier, more profitable