U.S. President George Bush poses for photographers after his address to the nation, 27 September 1991, in the Oval Office of the White House. During his speech, Bush announced that the U.S. will unilaterally eliminate its land and sea-based short-range nuclear weapons.
U.S. President George Bush poses for photographers after his address to the nation, 27 September 1991, in the Oval Office of the White House. During his speech, Bush announced that the U.S. will unilaterally eliminate its land and sea-based short-range nuclear weapons. - 

Former President George H.W. Bush died on Friday at age 94.

Bush served two terms as Ronald Reagan's vice president before he was elected president himself in 1988. At the Republican convention that year, when he accepted the nomination, he made a fateful pledge: "Read my lips. No new taxes."

That pledge would come back to haunt the 41st president. It became very hard to keep once he had taken office. 

At first, Bush resisted the idea of raising taxes. But he needed to cut the budget deficit, and he was working with a Congress controlled by Democrats. Finally, he decided to compromise and agreed to higher taxes as part of a 1990 budget agreement.

"Bush sat down and gave up his major 1988 campaign pledge in order to make a deal to get things done, and to try to get the economy running again," said University of Virginia political science professor Larry Sabato.

Bush also decided to compromise during the savings and loan crisis, when rampant fraud triggered the collapse of hundreds of savings and loans. As vice president, he'd led a task force on deregulation. Bill Black, now an economist at the University of Missouri, was a chief litigator during the crisis. Black said the deregulation Bush helped put in place destabilized the savings and loan business and made it easy to mask losses with accounting gimmicks. Eventually, Black said, Bush reversed himself and realized deregulation was not the answer.

"It wasn't a road-to-Damascus-type change, but Bush made very substantial change, and it was real, and he could have taken a very different road."

Black said Bush got Congress to pass legislation that gave federal regulators more power and funding to crack down on fraud. Black and other government investigators brought hundreds of fraud cases against savings and loans, with, he said, a 90 percent conviction rate that wouldn't have happened without strong backing from the 41st president.  

"President Bush was a traditional, conservative to moderately conservative Republican who believed in good government," said historian Tim Naftali, who wrote a biography of the former president. He said Bush's moderate beliefs allowed him to compromise and steer the economy onto firm economic ground.

"So what we're talking about here is the adult in the room," he said. "George H.W. Bush managed the economy in a way that laid the foundation for the Clinton boom of the '90s."

Naftali said the first President Bush did the tough work, like raising taxes, that was necessary to cut the deficit and that the U.S. deficit would be even higher today if he hadn't tackled it during his presidency. But, Naftali says, Bush didn't get credit for that because the economy didn't start to improve until after he left office.

"The bounce back was occurring during the 1992 election. But it came too late for George H.W. Bush. He had already been defeated, and was out of the White House by the time the public was seeing the recovery."

George H.W. Bush lost to Bill Clinton amid voters' concerns about the economy and a sense that the 41st president was out of touch with their economic woes. 

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Follow Nancy Marshall-Genzer at @MarshallGenzer