Iceland in the Cold War a summit in Reykjavík in 1986 between United States President Ronald Reagan and Soviet Premier Mikhail Gorbachev, during which they took significant steps toward nuclear disarmament. Only a few years later, in 1991, when Jón Baldvin Hannibalsson was foreign minister, Iceland would become the first country to recognize the independence of Estonia, Latvia, and Lithuania as they broke away from the Soviet Union. The US base served as a hub for transports and communications to Europe, a key chain in the GIUK gap, a monitor of Soviet submarine activity, a linchpin in the early warning system for incoming Soviet attacks,
Presidency of Ronald Reagan programs and priorities that had dominated the national agenda since the 1930s. Domestically, the Reagan administration enacted a major tax cut, sought to cut non-military spending, and eliminated federal regulations. The administration's economic policies, known as "Reaganomics", were inspired by supply-side economics. The combination of tax cuts and an increase in defense spending led to budget deficits, and the federal debt increased significantly during Reagan's tenure. Reagan signed the Tax Reform Act of 1986 (which simplified the tax code by reducing rates and removing several tax breaks) and the Immigration Reform and Control Act of 1986 (which enacted sweeping changes