Members of the CIA and the National Security Council, including several top-level Reagan advisers, were tried and found guilty of violating the Boland Amendment and other federal laws in order to support and arm the anti-Communist rebel Contras in Nicaragua without Congress’s knowledge. Though Reagan claimed no direct involvement in a secret plan to arm the Contras using profits made from arms sold to Iran, the Iran-Contra affair blemished the President’s administration.
Following more than a year of diplomatic conflict between the US and Panama, US military forces invaded Panama. The invasion was widely condemned by the international community, but President Bush justified the action as a measure to protect American citizens in Panama, fight Panamanian drug trafficking, protect the neutrality of the Panama Canal, remove General Manuel Noriega, and restore democratic government.
At a summit in Washington, DC, President Reagan and Soviet leader Mikhail Gorbachev signed the Intermediate-Range Nuclear Forces Treaty, agreeing to the destruction of all US and Soviet intermediate-range nuclear and conventional missiles and providing for on-site weapons inspections.
Ronald Reagan signed the Economic Recovery Tax Act, a major tax-reform bill based on “supply side economics,” cutting taxes and regulations. The act implemented an across-the-board tax cut for individuals, reduced the maximum income tax rate, lowered capital gains and estate taxes, and expanded individual retirement accounts.
The Exxon Valdez oil tanker ran aground in Prince William Sound, Alaska. The ship spilled more than eleven million gallons of oil into the sound. The largest oil spill to that point in US history, the spill took months to clean up and had an inestimable ecological impact for the future.