| − | With a large federal deficit, Democrats in Congress believed in raising taxes and Republicans believed in reducing federal domestic spending. President Bush and Congressional Democrats reached a compromise that would both have spending cuts and increased taxes, which would reduce the deficit $500 billion over five years as part of a 1990 budget agreement. In 1991 the U.S. entered into a mild recession. Unemployment was at 7.8%, although inflation and interest rates were at it's lowest in years. The recession lasted for about six months, although Democrats made it an issue for two years. | + | With a large federal deficit, Democrats in Congress believed in raising taxes and Republicans believed in reducing federal domestic spending. President Bush and Congressional Democrats reached a compromise that would both have spending cuts and increased taxes, which would reduce the deficit $500 billion over five years as part of a 1990 budget agreement. In 1991 the U.S. entered into a mild recession. Unemployment was at 7.8%, although inflation and interest rates were at its lowest in years. The recession lasted for about six months, although Democrats made it an issue for two years. |