The president also received broad bipartisan congressional backing for the brief U.S. invasion of Panama on December 20, 1989, that deposed dictator General Manuel Antonio Noriega. In the 1980s, addiction to crack cocaine reached epidemic proportions, and President Bush put the "war on drugs" at the center of his domestic agenda. The United States had compelling evidence that Noriega was involved in drug smuggling operations and by means of the invasion sought to bring Noriega to justice. But there were other reasons. One of Bush's aims was to replace Noriega with a government headed by Guillermo Endara, who had won a presidential election that Noriega subsequently annulled. Bush also told reporters that he ordered U.S. troops to Panama to safeguard the lives of American citizens, to help restore democracy and to protect the integrity of the Panama Canal treaties. Noriega eventually turned himself over to U.S. authorities, and he was later tried and convicted in U.S. federal court in Miami, Florida, of drug trafficking and racketeering.  

The Bush administration marked progress on the economic front with the negotiation of the North America Free Trade Agreement (NAFTA) with Mexico and Canada, which became the focus of an intense ratification debate in the Clinton administration. Labor unions charged that NAFTA would encourage the export of U.S. jobs, and environmentalists expressed concern that the agreement provided incentives to industries to relocate to regions having lax controls on industrial pollution. Both the Bush and Clinton administrations, however, argued that NAFTA would permit a greater flow of goods and services at lower cost, and would make industry in all three countries more competitive in the global marketplace. NAFTA, which was approved by the Congress after a vigorous national debate in late 1993, is viewed by many as a testing ground for future trade agreements, which could eventually lead to free trade throughout the Western Hemisphere.