Looking back at my holiday posts, I realize I did nothing but whine for two weeks (Eeyore was, after all, a donkey). So enough of that. Like many of you, no doubt, I caught up a bit on my reading, and also got a few new books for Christmas. By far the most enjoyable holiday read was an advance copy of Michael Kazin’s new biography of William Jennings Bryan, A Godly Hero. I’ve written an extensive review of the book for The Washington Monthly‘s next issue. But suffice it to say that I recommend it highly, especially to those self-styled populists of the Left and Right who claim parts of Bryan’s heritage while ignoring aspects of the Commoner’s thinking that don’t fit into their own ideologies. Like a lot of sports junkies, I asked for and received the ESPN College Football Encyclopedia under the Christmas tree. And I suspect a lot of said junkies shared my reaction to the tome: it’s fun at first, but gets boring pretty fast. Sure, it’s a handy reference book for resolving arguments, but who really wants to sit around reading box scores of every bowl game in history; statistical summaries of every season; or team schedules from time immemorial? The essays that begin and end the book are pretty sketchy, and the individual team histories generally read like they were written by Sports Information Directors for the schools involved. Probably the most interesting general tidbit is the section in each team history about how they acquired their nicknames and mascots. In other words, it’s a fine book to keep in the W.C. I always get at least one theological book for Christmas, and this year’s selection was Kevin Irwin’s May 2005 offering, Models of the Eucharist. It’s a useful if somewhat frustrating study: useful because Irwin exhaustively examines the truth underlying a variety of historical and contemporary understandings of the central ritual of (non-evangelical) Christianity; frustrating because the book’s design as an official Roman Catholic textbook gives it a didactic tone that undercuts its scope of inquiry. Still, if you’re interested in this topic, Irwin’s book belongs on the same shelf with Dom Gregory Dix’s seminal The Shape of the Liturgy, and the playful post-Vatican II classic, Thomas Day’s Why Catholics Can’t Sing.In an earlier post I lifted a quote from another book I finished reading over the holidays: Eamon Duffy’s Saints and Sinners: A History of the Popes. Duffy manages to pull off a credible and readable history of two thousand years of papal development in just 317 pages, and is particularly good on the tangled legacy of the Renaissance Popes and the internal Church tensions that produced the First Vatican Council and the doctrine of papal infallibility. Given his unhappiness with the authoritarian strain of Pope John Paul II’s reign (the book was published in 1997), you have to wonder if Duffy will produce a revised edition assessing the significance of Joseph Ratzinger’s election as Benedict XVI. (Disclosure: I’m a big fan of Duffy’s work on the Tudor Reformation, especially The Stripping of the Altars. And one of my favorite memories was the opportunity I had a couple of years ago to sit next to Duffy at High Table at Cambridge’s Magdalen College, while I was there to participate in a panel discussion of neoconservatism). The last book I undertook as 2005 waned was a golden oldie which I retrieved from a dusty bookshelf at home: Gore Vidal’s 1973 novel, Burr.Anyone who just thinks of Vidal as a cranky conspiracy theorist, a media hound, or the purveyor of tawdry novels like Myra Breckinridge, should definitely read Burr and its equally delightful sequel, 1876. These books stand alone as historical fiction of the highest order.
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Editor’s Corner
By Ed Kilgore
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July 21: Don’t Dismiss the Power of Inflation Politics
All the talk of renewed inflation brought back some terrible memories for me, and I wrote about them at New York:
When I was a freshman college debater at Emory University in the fall of 1970, the national debate topic was not Vietnam, but the desirability of wage and price controls. Little did we know that just months ahead a Republican president would impose a wage-price freeze, long the anti-inflationary prescription of the left wing of the Democratic Party. But the surprise known in financial circles as the “Nixon shock,” nearly a half-century ago (on August 15, 1971) showed how pervasive the fear of inflation — running at just over 5 percent in 1970 — had become.
That’s ancient history now, even to those of us who remember the double-digit inflation of the late 1970s, and the particularly horrid scourge of “stagflation” (high inflation and unemployment simultaneously). Inflation seems to have been tamed by wise monetary policies. The periodic warnings from 21st-century conservatives that low interest rates and federal budget deficits would create inflation didn’t much bother me. It was like hearing an old priest chant a forgotten litany in a lost language — just one among many ritualistic arguments for the tight credit and reactionary social policies these people favored instinctively as a sort of class self-defense posture.
The current surge in consumer prices doesn’t necessarily change that picture; the current post-pandemic (we hope) economic environment was sure to produce a spike in wages and prices that cannot be projected into a future where something approaching normalcy will surely return (though the real-estate bubble is indeed troubling). But now I am beginning to hear echoes of the inflation panics of the not-so-distant past, which make me tremble.Like Tim Noah, I suspect there may be a generational lapse in understanding the politics of inflation:
“I don’t care to be condescended to by a bunch of Gen Xers and Millennials about my ’70s-bred fear of inflation. It feels too much like the condescension we Boomers directed toward Depression babies whenever they warned us that we were playing with fire in deregulating the financial markets. Poor dears, we thought, traumatized for life by the 1929 crash and one-third of a nation ill-housed, ill-clad, ill-nourished.
“The Depression babies turned out to be right, of course.”
Noah makes it clear he’s not arguing inflation per se is bad for the economy. It is, however, bad for progressive politics, and not just because “stagflation” probably killed the Carter presidency and ushered in the Reagan era far more than the Iranian hostage crisis or other better-remembered Democratic foibles. The deflationary economic strategies of the 1980s weren’t called “austerity,” but rather a corrective for undisciplined policies that fed wage and price spirals which in turned hammered the value of savings, the living standards of those on fixed incomes, and the political case for federal domestic spending.
Most lethally for progressivism, the conservative supply-side tax-cutting when combined with inflationary fears can create enormous pressure for public disinvestment and the shredding of safety nets (which is why reactionaries happily labeled the intended result “starving the beast”). We are still living with some of the long-term consequences of anti-inflationary backlash. As Noah points out, California’s Proposition 13 ballot initiative in 1978 and similar “tax revolts” were a by-product of price spirals that boosted tax assessments on property and income alike.
But sometimes lost in an examination of the right’s exploitation of inflation fears is the abiding fact that the left has no clear prescription for dealing with it, either, other than by denying its existence or significance (sometimes rightly, sometimes wrongly). Ironically, that was made most evident by the supposedly illiberal Richard Nixon’s surprising use of the great liberal instrument for taming inflation.
The veteran ex-conservative economic and political analyst Bruce Bartlett has penned an exceptional explainer on the background and consequences of the “Nixon shock,” particularly its international dimensions, and the role played by Treasury Secretary John Connally, who like his boss and ally Nixon was more focused on short-term politics than on long-term economic realities. What’s clear is that Nixon was convinced a recession induced by the Eisenhower administration and its Federal Reserve Board appointees designed to kill inflationary pressures also killed his 1960 presidential candidacy. As prices spiked in 1970, he was terrified the same thing could happen in 1972.
Nixon had inherited (and temporarily extended) an income-tax surcharge from LBJ that was designed to pay for the skyrocketing costs of the Vietnam War, but its effects were limited. So with his signature televised bombshell reveal (the one he deployed a month earlier to announce his trip to China), amid great secrecy, Nixon rolled out a combo platter of initiatives to fight inflation and international economic instability. They included a suspension of fixed currency exchange rates and the convertibility of the dollar to gold (to head off a raid on gold supplies triggered by a British demand for a major conversion); an import surcharge (to prevent a worsening of the trade balance); and most significantly for most Americans, a 90-day freeze on wages and prices to be followed by an indefinite period of controls by federal panels.
As political theater, Nixon’s speech announcing a “new economic policy” was, well, Nixonian. He began with dessert: an assortment of tax breaks and job-creation incentives balanced by mostly unspecified spending cuts; only then did he mention the wage-price freeze. After promising to “break the vicious circle of spiraling prices and costs,” Nixon moved on to his international proposals, which he downplayed as “very technical,” while assuring viewers that “if you are among the overwhelming majority of Americans who buy American-made products in America, your dollar will be worth just as much tomorrow as it is today.”
Nixon’s wage and price controls were initially very popular (as polls had told the White House they would be) and did indeed hold down inflation through the reelection year of 1972, when Nixon won his famous landslide reelection over poor George McGovern, in part by goosing federal appropriations to create a mini-boom. By then the administration had moved on to a more discretionary system for regulating wage and price increases, which generated rumors of employers currying favor with generous donations to CREEP (the Committee to Reelect the President), the notoriously corrupt operation heavily complicit in the Watergate scandals that brought down the Nixon presidency. Between the suppressed and eventually unleashed inflationary pressures and the oil-price shock Nixon’s international economic policies helped create, the country paid a very high economic price for the brief respite from inflation the wage-price freeze earned him. He sowed the wind with even greater inflation, and his successors Gerald Ford (whose feckless “Whip Inflation Now” campaign was widely mocked) and Jimmy Carter reaped the whirlwind.
Before you dismiss these events from 50 years ago as irrelevant, consider how much Nixon’s short-sighted approach sounds like something President Donald Trump might have done if inflation had became a political problem during his tenure (or in, God help us, a future term). Indeed, any president mulling Nixon’s choice of recession-inducing fiscal or monetary policies might be tempted to resort to the easy-to-understand, if dangerous, strategy of wage and price controls in which the pain is mostly back-loaded, particularly in or near an election year. Old folks remember how it preceded Nixon’s landslide 1972 win, followed by a decade of economic pain and multiple decades of political misery for progressives.