Opinion | Jimmy Carter and the End of Democratic Capitalism

Opinion | Jimmy Carter and the End of Democratic Capitalism


I mark Presidents Day by sharing with you some thoughts on Jimmy Carterwho is now in palliative care.

The Carter administration marked the end of 45 years of democratic capitalism, the goal of which had been to harness the private sector for the common good.

It is important to understand what happened and why.

For years the rap about President Carter was that his presidency failed, but his post-presidency was the best in modern history.

It’s far too simplistic.

Carter’s life After his presidency was exemplary for the same reason he was elected president after the disasters of Richard Nixon and Nixon’s Vice President Gerald Ford (who unconditionally pardoned Nixon for any crimes he might have committed): Carter’s modesty, decency and humanity.

Not only were these traits the opposite of Nixon’s, but they would shine even brighter 40 years later in contrast to the repulsive Donald Trump.

Single-term presidents are always presumed failures because voters did not re-elect them. But Carter lost his reelection bid (as George HW Bush would 12 years later) not because his presidency failed, but because the Federal Reserve raised interest rates to such an extent that he caused a recession. Recessions don’t just stifle inflation; they also stifle presidencies.

During Carter’s tenure, the OPEC oil cartel pushed oil prices from $13 a barrel to over $34, driving double-digit price increases across the economy. Paul Volcker, appointed by Carter as Fed Chairman, was determined to “break the back of inflation” by raising interest rates to nearly 20% by 1981, causing a deep recession and losing their employment to millions of people, including Carter.

It’s not Carter’s fault that democratic capitalism ended with him. On the contrary, he appointed many consumer, labor and environmental advocates to his administration.

Full disclosure: I was a Carter appointee, but only met him twice, once at a Rose Garden ceremony and years later at a dinner party at Senator Dianne Feinstein’s house. (He was unusually late for dinner but made a surprise entrance, descending the stairs from a bedroom where he had been taking a nap. He apologized profusely, making two un-Trump concessions in one sentence: “I I’m getting old and I need my nap,” he says with a faint smile, “but I should have told someone I was riding.”)

Many of his initiatives — ending funding for the B-1 bomber, seeking a comprehensive consumer protection bill, proposing far-reaching tax reform, opposing traditional “hog barrel” spending, creating a “superfund” to clean up toxic waste sites, and the deregulation of the airline, trucking, and railroad industries (resulting in lower transportation costs for industry and consumers)—were laudable.

But much of what he did seemed to vindicate Lewis Powell’s warning to American business in a 1971 memo to the US Chamber of Commerce that companies must build up their lobbying strength in Washington or suffer political defeat. .

The untold story of the Carter years is the vast increase in corporate political firepower during this time. Trade associations, law firms, lobbying firms, political operatives and public relations specialists swarmed Washington, offering leaders so much money that most incumbents of Congress also became lobbyists.

The city has grown from a sleepy, even seedy backwater, to the hub of America’s political wealth – teeming with tony restaurants, upscale hotels, expensive bistros and 25-room mansions (one of which is owned now to Jeff Bezos), and bordered by two of the wealthiest counties in the country.

With the defeat of Carter’s consumer protection legislation in 1978 at the hands of corporate lobbyists, Richard Lesher, then president of the U.S. Chamber of Commerce, vaunted that: “In 30 to 40 years, people will look back and say, ‘Those were the years when the transition took place.’ … We are waking up. And big business will be at the forefront of this campaign.

Maybe Carter could have avoided this if he had been more politically cunning, but I doubt it. After 45 years of playing defense, corporate America was eager to regain the reins of power. Despite his best efforts, Carter paved the way for Ronald Reagan – and America’s return to the corporate capitalism that had dominated the nation before the Great Depression and Franklin D. Roosevelt.