Iwan Morgan

JIMMY CARTER, BILL CLINTON, AND THE NEW DEMOCRATIC ECONOMICS

Jimmy Carters response to stagflation, the unprecedented combination of stagnation and double-digit inflation that afflicted the American economy during his presidency, made him the subject of virulent attack from liberal Democrats for betraying New Deal traditions of activist government to sustain high employment and strong economic growth. Carter found himself accused of being a do-nothing president whose name had become ‘a synonym for economic mismanagement’ like Herbert Hoovers in the 1930s.1 Liberal disenchantment fuelled Edward Kennedys quixotic crusade to wrest the 1980 Democratic presidential nomination from Carter. ‘[H]e has left behind the best traditions of the Democratic Party’, the Massachusetts senator charged, ‘We are instructed that the New Deal is old hat and that our best hope is no deal at all.’2 A quarter-century later a more dispassionate analysis would suggest that Carter was neither a do-nothing president nor a throwback to the past in terms of economic policy. Far from being the ‘Jimmy Hoover’ of liberal obloquy, Carter was really ‘Jimmy Clinton’ because in seeking solutions for stagflation his administration laid the foundations of a new political economy that the next Democratic president would build upon.

Reaganomics and its Legacy

In his memoirs, Ronald Reagan underlined the primary significance of economic policy to his presidential agenda. As he put it, “Nothing was possible unless we made the economy sound again.”1 From the late 1960s to the early 1980s the United States had experienced its worst economic problems since the 1930s. The development of stagflation—concurrent inflation and stagnation—had produced three recessions and unprecedented price instability. Matters appeared to reach crisis point by late 1980. Productivity growth had ground to a virtual halt and the misery index—the combined rate of inflation (13 percent) and unemployment (7 percent)—stood at 20 percent. In the quarter-century since 1983, by contrast, the American economy has been a vibrant engine of almost continuous growth, high employment, and low inflation. In this period there have only been two shallow recessions (at time of writing), an average of one every twelve years. Never before has the United States enjoyed a period of such prolonged expansion and little contraction. Between 1949 (the date of the first postwar recession) and 1980 the average duration of each expansion cycle was barely 4.5 years. During the era of what some economists call “the great expansion,” the United States consolidated its position as the number one economic power in the world, a status it had looked to be in danger of losing by the end of the 1970s.

Monetary Metamorphosis: The Volcker Fed and Inflation

As the 1970s drew to a close, the infl ation that had blighted America’s economy for much of the decade appeared out of control. Under Paul Volcker’s leadership, the Federal Reserve adopted a new policy of money-supply control to curb runaway price instability. Th is strategy precipitated the deepest recession since the 1930s in 1981–82, during which GDP fell 2.9 percent and some three million payroll jobs were lost—over two-thirds of them in manufacturing. 1

Unconventional Politics: The Campaign for a Balanced-Budget Amendment Constitutional Convention in the 1970s

The drive to enact a constitutional amendment requiring balancedn federal budgets has been a defining issue of American politics in the final decaden of the twentieth century. Supporters of this measure deemed it the onlyn way to break the cycle of huge deficits that inflated the national debtn to almost unmanageable proportions in recent years. In 1995, 1996 and 1997n only the Senates narrow failure to deliver the requisite two-thirdsn majority – latterly by a single vote – prevented Congress proposingn an amendment for ratification by the states. Nevertheless the balanced-budgetn amendment campaign is not a product of the deficit-conscious 1990s. It originated in the 1970s as a movement by the states to imposen fiscal discipline on the federal government. Between 1975 and 1979 thirtyn states petitioned Congress for a convention to write a balanced-budgetn amendment. The convention method of constitutional reform had lain unused since the Founding Fathers devised it as an alternative to congressional initiative, but the support of only four more states wouldn have provided the two-thirds majority needed for its implementation. Then states campaign stalled at this juncture in the face of oppositionn from the Carter administration and congressional Democrats. By then, however, itn had done much to popularize the balanced-budget amendment and make it part of the nations political agenda. This article seeks to analyze the development of the balanced-budgetn amendment constitutional convention campaign and to assess its historicaln significance. Aside from its relevance to todays fiscal politics,n the movement merits attention as an important episode in the history of then 1970s, an era when economic problems at home and defeat abroad underlined the limits of Americas prosperity and power. In this troubledn time, popular confidence in the nations political leaders underwentn marked decline. The Watergate scandal, failure in Vietnam and economicn stagflation created doubts about their trustworthiness and competence ton deal with Americas problems. The budget revolt by the states wasn a manifestation of this anti-Washington mood. In style as well as substance,n the campaign challenged conventional politics: it manifested distrust inn elected leaders to manage public finances without constitutional restraintn and sought to bypass establishment control of the orthodox forms of politics through adoption of an untested process of constitutional change.n In many respects the drive for a balanced-budget amendment convention was an expression of the same populist impulse that was the mainspringn of Jimmy Carters campaign for president in 1976. The former Georgian governors status as a political outsider untainted by previous connectionn with Washington had been his greatest electoral asset, but in office thisn man-of-the-people aligned himself with the nations political establishmentn against the convention campaign. Analysis of Carters response to this movement casts light on the ambiguity and complexity of his presidential politics.

Make America Great Again: Ronald Reagan and Donald Trump

This chapter will show how Reagan’s prior experience in government and cogent ideological convictions enabled him to make more rapid progress in his first year than the inexperienced and un-ideological Trump in setting the core agenda of his administration, appointing key personnel to deliver his vision and winning the big political battles over his taxation and spending programmes.

John Ford's 'Young Mr Lincoln:' A Popular Front Hero for the Late 1930s

Considers the second movie in Fords Americana trilogy of 1939 as a reflection of the directors Popular Front sympathies and examines how a fictional episode in Lincolns life in 1837 was used to make him the embodiment of progressive values relevant to the 1930s

Andrew Johnson: The Wrong Man in the Wrong Place

This assesses the failures of Andrew Johnsons presidential leadership from 1865 to 1869, arguing he misunderstood the Norths expectations of what its Civil War victory should mean for the restored Union, overestimated the defeated white Souths willingness to reform itself, and lacked the political skills of persuasion and compromise.

Introduction: Remembering Watergate

Watergate destroyed the presidency of Richard M. Nixon. Entailing far more than the cover-up of the botched burglary of the Democratic National Committee (DNC) offices on June 17, 1972, it was the generic name that encompassed all the serious crimes and misdemeanors of the Nixon White House. From early 1973 until Nixon’s resignation on August 9, 1974, to avoid almost certain impeachment, the nation was shocked by the steady stream of revelations about the misconduct of the president and his men. Time magazine called Watergate “America’s most traumatic political experience of this century.” Looking to declare an end to this sad episode in the nation’s history, Gerald Ford offered this assurance on the day he took office as Nixon’s successor: “My fellow Americans, our long national nightmare is over.”1

Richard Nixon, reputation and Watergate

For Richard Nixon history was about the future not the past. When revealing to the Senate Select Committee on Presidential Campaign Activities (better known as the Ervin Committee) that his boss had routinely taped Oval Office conversations in secret, White House aide Alexander Butterfield remarked, “The President is very history-oriented and very history-conscious about the role he is going to play.”3 The recordings were mainly intended to provide source material for the writing of the presidential memoirs that Nixon hoped would shape his grandiose image for posterity. It was the supreme irony that their revelations of his misdeeds were the instrument of the downfall that would largely determine his place in history.

Bush’s Political Economy: Deficits, Debt, and Depression

When George W. Bush became president, America’s economic future seemed bright. Thanks to new technology and massive expansion of investment, productivity growth had reached levels not seen since the 1960s as the twentieth century drew to a close. The creation of over 18 million new jobs during Bill Clinton’s presidency effectively produced a full-employment economy with the jobless level at just 4 percent in 2000. The tax revenues harvested from boom times ended the twenty-eight-year unbroken cycle of budget deficits to produce four consecutive balanced budgets in Fiscal Years (FY) 1998–2001, the longest sequence of federal surpluses since the 1920s. Confidence that economic growth would continue apace generated expectation that the federal government would have the surplus income to pay off the public debt within a decade.