The sputnik incident names a dispute between the soviet union and the united states that resulted from the soviet union shooting down of an american spy plane.

The Soviet Union had humiliated the U.S. by launching Sputnik I.  They beat us in the space race and the public was claiming our military budget must be increased to catch up.  President Eisenhower wanted a more restrained military budget and he used the information gathered during the spy plane flyovers to prove the Soviets were not that far advanced, therefore the U.S. could maintain a more modest budget.  When we were caught doing state-sponsored espionage, when the U-2 spy plane was shot down and the pilot was captured (Gary Francis Powers), Eisenhower created cover stories thinking the pilot was dead and nothing was left of the aircraft.  The Soviets kept the pilot's status a secret until they had humiliated the U.S. by exposing the mission (of which they had proof and a living pilot too).  Sputnik was considered an incident of great embarrassment for the U.S. and having it all thrown together was a blow to the U.S.  President Eisenhower was caught flat-footed but once it was admitted and out in the open, the U.S. public was proud of the efforts put forth by the spy plane pilots.