Opinion | Jimmy Carter began to fix the inflation crisis Nixon created to win reelection – By Tiana Lowe (Washington Examiner) / Feb 20, 2023
After nearly a century of public service, Jimmy Carter has entered home hospice care, signaling that the end is near for America’s longest living president. While Carter’s lackluster tenure in the White House has been largely overshadowed by his post-presidential philanthropy, conservatives in particular ought to recognize that it was Carter who began to tackle the inflation crisis that Richard Nixon created.
Per my estimation, the most dangerous and damaging thing Nixon ever did to win reelection was not Watergate. Rather, it was his decision to blow up the Bretton Woods agreement unilaterally to finance an American expansion painted by the press as prosperity. In one weekend and without diplomatic discussion, Nixon took the world off of the gold standard — valued at $35 per ounce of gold since after World War II — to devalue the U.S. dollar intentionally. Nixon, who had already browbeaten his handpicked Federal Reserve chairman into submission and lax monetary policy, decided to enact disastrous wage and price controls, sacrificing price stability at the altar of ephemeral “full employment.” All in all, the money supply was expanding at twice the rate of real economic expansion under Nixon’s first term.
Carter was objectively not a good president, but he absolutely reversed one of Nixon’s crucial wrongs and ultimately set the economy on the course for regaining price stability. Despite making the same early mistake of believing the Fed needed to keep rates low to boost employment, Carter poached Fed Chairman G. William Miller to run the Treasury Department and put Paul Volcker, a known monetarist who butted heads with the expansionists of the Nixon administration, at the head of the central bank. Unlike Nixon, Carter put a chairman in place who would lead the Fed as an independent body hellbent on crushing inflation, even at the cost of Carter’s reelection.
It is true that in order to kill the crisis of stagflation, Volcker’s monetary policy had to be met with fiscal policy, and it was Ronald Reagan who would ultimately get the job done. But even conservatives cannot forget that it was Nixon who devalued the U.S. dollar to win reelection and Carter who inadvertently sacrificed his own political career to restabilize the American economy.
