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CHAPTER 13: DECADES OF CHANGE: 1960-1980OUTLINE OF U.S. HISTORYimposing wage and price controls,a policy in which the Right had nolong-term faith, in 1971. In the shortrun, these decisions stabilized theeconomy and established favorableconditions for Nixon’s re-election in1972. He won an overwhelming victoryover peace-minded DemocraticSenator George McGovern.Things began to sour very quicklyinto the president’s second term.Very early on, he faced charges thathis re-election committee had manageda break-in at the Watergatebuilding headquarters of the DemocraticNational Committee and thathe had participated in a cover-up.Special prosecutors and congressionalcommittees dogged his presidencythereafter.Factors beyond Nixon’s controlundermined his economic policies.In 1973 the war between Israel andEgypt and Syria prompted SaudiArabia to embargo oil shipments toIsrael’s ally, the United States. Othermember nations of the Organizationof the Petroleum Exporting Countries(OPEC) quadrupled their prices.Americans faced both shortages,exacerbated in the view of many byover-regulation of distribution, andrapidly rising prices. Even when theembargo ended the next year, pricesremained high and affected all areasof American economic life: In 1974,inflation reached 12 percent, causingdisruptions that led to even higherunemployment rates. The unprecedentedeconomic boom Americahad enjoyed since 1948 was grindingto a halt.Nixon’s rhetoric about the needfor “law and order” in the face ofrising crime rates, increased druguse, and more permissive viewsabout sex resonated with moreAmericans than not. But this concernwas insufficient to quell concernsabout the Watergate break-inand the economy. Seeking to energizeand enlarge his own politicalconstituency, Nixon lashed out atdemonstrators, attacked the pressfor distorted coverage, and soughtto silence his opponents. Instead, heleft an unfavorable impression withmany who saw him on television andperceived him as unstable. Addingto Nixon’s troubles, Vice PresidentSpiro Agnew, his outspoken pointman against the media and liberals,was forced to resign in 1973, pleading“no contest” to a criminal chargeof tax evasion.Nixon probably had not knownin advance of the Watergate burglary,but he had tried to cover it up,and had lied to the American peopleabout it. Evidence of his involvementmounted. On July 27, 1974, theHouse Judiciary Committee votedto recommend his impeachment.Facing certain ouster from office, heresigned on August 9, 1974.THE FORD INTERLUDENixon’s vice president, GeraldFord (appointed to replace Agnew),was an unpretentious man who hadspent most of his public life in Congress.His first priority was to restoretrust in the government. However,feeling it necessary to head off thespectacle of a possible prosecutionof Nixon, he issued a blanket pardonto his predecessor. Although it wasperhaps necessary, the move wasnonetheless unpopular.In public policy, Ford followedthe course Nixon had set. Economicproblems remained serious, as inflationand unemployment continuedto rise. Ford first tried to reassurethe public, much as Herbert Hooverhad done in 1929. When that failed,he imposed measures to curb inflation,which sent unemploymentabove 8 percent. A tax cut, coupledwith higher unemployment benefits,helped a bit but the economyremained weak.In foreign policy, Ford adoptedNixon’s strategy of detente. Perhapsits major manifestation was theHelsinki Accords of 1975, in whichthe United States and Western Europeannations effectively recognizedSoviet hegemony in Eastern Europein return for Soviet affirmationof human rights. The agreementhad little immediate significance,but over the long run may havemade maintenance of the Sovietempire more difficult. Westernnations effectively used periodic“Helsinki review meetings” to callattention to various abuses of humanrights by Communist regimesof the Eastern bloc.THE CARTER YEARSJimmy Carter, former Democraticgovernor of Georgia, won the presidencyin 1976. Portraying himselfduring the campaign as an outsiderto Washington politics, he promiseda fresh approach to governing, buthis lack of experience at the nationallevel complicated his tenure fromthe start. A naval officer and engineerby training, he often appearedto be a technocrat, when Americanswanted someone more visionary tolead them through troubled times.In economic affairs, Carter atfirst permitted a policy of deficitspending. Inflation rose to 10 percenta year when the Federal ReserveBoard, responsible for setting monetarypolicy, increased the moneysupply to cover deficits. Carterresponded by cutting the budget,but cuts affected social programs atthe heart of Democratic domesticpolicy. In mid-1979, anger in thefinancial community practicallyforced him to appoint Paul Volckeras chairman of the Federal Reserve.Volcker was an “inflation hawk”who increased interest rates in anattempt to halt price increases, atthe cost of negative consequencesfor the economy.Carter also faced criticism for hisfailure to secure passage of an effectiveenergy policy. He presenteda comprehensive program, aimedat reducing dependence on foreignoil, that he called the “moral equivalentof war.” Opponents thwartedit in Congress.Though Carter called himself apopulist, his political priorities werenever wholly clear. He endorsedgovernment’s protective role, but290291