The Last Good President: Jimmy Carter (1977-1981)

There are four especially good presidents who have surprisingly bad reputations: John Tyler, Chester Arthur, Warren Harding, and Jimmy Carter. I have already covered John Tyler in depth, explaining why I think he was America’s best president. I will be taking on Arthur and Harding in due course. Today it’s Jimmy Carter.

Some biographers, to be sure, give Carter his due, and it’s worth citing two of them. These are valuable because the authors have no interest in apologetics or hagiography.

“It is conventional wisdom that Jimmy Carter was a weak and hapless president. But the single term served by the thirty-ninth president was one of the most consequential in modern history. Far from a failed presidency, he left behind concrete reforms and long-standing benefits to the people of the Unites States as well as the international order. It is time to redeem his presidency from the lingering memories of double-digit inflation and interest rates, of gasoline lines, as well as the scars left by the national humiliation of American diplomats held hostage by Iranian revolutionaries for more than one year. Let me be clear: I am not nominating Jimmy Carter for a place on Mount Rushmore. He was not a great president, but he was a good and productive one. He delivered results, many of which were realized only after he left office.” (Stuart Eizenstat, President Carter: The White House Years)

“The negative assessments that continue to haunt Carter are mostly a bum rap. If Richard Nixon was, contrary to his reputation, the last liberal president until Barack Obama, then Carter was surprisingly the first conservative chief executive since Calvin Coolidge. Carter was a transitional president at a time when the New Deal coalition, which had coalesced in the 1932 election, was being eclipsed by a growing conservative movement. Carter promoted individuals taking personal responsibility, opposed special interest groups feeding at the government trough, championed limiting the federal government and reducing the federal budget deficit, argued for greater local responsibility, advocated the deregulation of industries, and believed that welfare eroded the family and the work ethic. His policy achievements were greater than his policy failures and his occasional operational incompetence. Although he overreacted to the Soviet invasion of backwater Afghanistan, paid an exorbitant price for only partial peace in the Middle East, he generally exhibited restraint in foreign policy, had an admirable penchant for economic deregulation, and most important, appointed Paul Volcker as chairman of the Federal Reserve Board.” (Ivan Eland, Recarving Rushmore)

Accurate assessments. So why the persistence among so many historians in demonizing Carter? Two big reasons, I think. There is first the charisma bias that plagues most presidential assessments. Unlike FDR, Kennedy, Reagan, Clinton, and Obama, Carter was not a charismatic. But charisma has no place in a presidential assessment. That Carter couldn’t rouse people with speeches is utterly irrelevant to his presidential record.

Second, Carter remained an outsider to politics when he took office; he did not become a “Washingtonian”, and because he wouldn’t play that game, he frequently took policy positions that angered the interest groups of his own party (the Democrats). Like John Tyler (who was ostracized by the Whigs) and Chester Arthur (who angered his fellow Republicans), he paid the price for that in the second election. But like Tyler and Arthur, Carter’s principled stands against his own party resound (as we will see) to his credit, not his detriment.

1. Foreign Policy

In general, Carter had good foreign policy. He believed that America shouldn’t police the globe, showing a rare executive wisdom for a president of the post World-War II era. He avoided war in the Horn of Africa. He refused to support Somali aggression against the Soviets, thus avoiding confrontation with the nuclear-armed Soviet Union. He got Congress to ratify an end to the neo-colonial U.S. occupation of the Canal Zone in Panama. He criticized both sides in the Nicaraguan civil war and stopped U.S. aid to the right-wing dictatorship. He scaled back involvement in this region (unlike Reagan who would support a covert war favoring the right-wingers against the left). He finished normalizing relations with China, and terminated the U.S.-Taiwanese defense alliance (unlike George W. Bush who would later recklessly pledge to defend Taiwan from a nuclear attack, thereby putting American cities at risk). This non-interventionist record is extremely impressive for a 20th-century president.

There are three stains, however, on Carter’s record, and they are not trivial: (a) the Camp David Accords and Israeli-Peace Treaty, (b) his intervention in Afghanistan, and (c) the Iran-Hostage crisis. Taken together, these sins go a long way to diminishing Carter’s otherwise excellent peace record.

(a) The Israeli-Egypt Treaty: A costly sham

Here is the darkest stain. It’s usually not seen that way. In the eyes of most analysts, the Camp David Accords of ’78 and Israeli-Egyptian Peace Treaty of ’79 were Carter’s greatest accomplishments. In fact they were his worst failures.

To back up a bit: The question of Israel is always frustrating, because on one hand the nation should have never been created, but on the other, since it was created, what’s done is done. The U.S. has naturally had a stake in Israel since Harry Truman aided its birth in 1947 at the United Nations. Despite my overall high regard for Truman (even higher than Carter), I think that was one of worst foreign policy snafus of the 20th century. The Jewish people deserve a homeland, but what the Allies should have done was carve out a section of Germany (the nation responsible for the Holocaust), instead of uprooting and inciting Arabs for sake of a religiously inspired “Promised Land” — an idea that has no more place in the 20th century than the Islamic jihad. Many Jews hadn’t lived in Palestine for two millennia, and they didn’t have a rightful claim on the land after all this time. Settling in hundreds of thousands of Jewish lives in a sea of Islam was, to put it mildly, a stupid idea. But again, what’s done is done. The state of Israel was created; generations have come and gone, and certainly a generation had passed by Carter’s time. Israel is the Jewish homeland now, for better or worse (I think mostly for the worse), and the U.S. has understandable interests in this island of democracy surrounded by autocratic Islamic regimes.

What Carter did was achieve the first peace between Israel and any Arab state — the Camp David Peace Accords (in September ’78) followed by the Israeli-Egyptian Peace Treaty (in March ’79). But the treaty he achieved was largely a sham. Islamic regimes have never accepted a Jewish state in their midst, and ultimately they never will. Understanding that is the key to any foreign policy decision in the Middle-East. Carter didn’t understand that (but then neither has any other president), and the treaty he engineered was empty. The Islamic mandate that Jews should be “driven out from where they drove you out” is a command that allows for no mitigation. The result was foreordained: Egyptian President Anwar Sadat was ostracized by most of the Arab world, and then assassinated by jihadists in 1981, for daring to come to any agreement with Israel. To this day, Egypt has failed to honor certain commitments under the Camp David Accords. It has not ended hostile propaganda towards Israel, but rather increased it through its press, radio, and television.

Most people have a rosy view of the Camp David Accords and peace treaty, because on the surface Carter was able to bridge two mutually hostile powers. But aside from even the sham of that peace, Carter had to pay both parties billions of dollars a year in aid — payments that continue to this day — so that both Israel and Egypt could do what was entirely in their own interest. This outcome also ensured that America would continue to be sucked into any dustup in the Middle-East that might be perceived as threatening the American-mediated “peace process”.

Alliances should be a means to security, not to an end themselves. The alliance with Israel provides few tangible benefits to U.S. security, and it promises to drag America into brushfire wars in a non-strategic region. Our alliance with Egypt is worse. To date, the Unites States has given sixty billion dollars to Egypt, not to mention military aid, while Egypt continues to flout some of the Camp David Accords. Only by blind and twisted logic can Carter’s act of peace-brokering be called a “great accomplishment”.

(b) Afghanistan: Arming the mujahideen

As a rule, Carter was outstandingly non-interventionist, but there was an exception, and it’s a whopper. On Christmas Eve 1979, the Soviets invaded Afghanistan, and for whatever bizarre reason, Carter overreacted. In his final State of the Union address, January 23, 1980 — and quite out of character — Carter made a (ludicrous) case that “the Soviet invasion of Afghanistan could pose the most serious threat to the peace since the Second World War”. It’s the sort of comment one would later expect from his successor Ronald Reagan. Perhaps Carter felt the need to “man up” and show strength so soon after the hostages were taken in Iran (on which see below). Who knows.

Carter then allowed his National Security Advisor (Zbigniew Brzezinski) to initiate a campaign which supported the mujaheddin (Islamic guerilla fighters) in both Afghanistan and Pakistan — promoting, in other words, Islamism to fight Communist forces. Although it was Reagan who would increase support for these jihadists on a massive level, the policy began with Carter, and he bears a strong measure of responsibility for the outcome. That outcome is well known: the Soviet Union got its own Vietnam, and the U.S. funded Islamists would go on to spawn al-Qaeda, resulting in the worst attack on the American homeland since the invasion of the War of 1812.

Carter (and Reagan) should have simply let the Soviets have Afghanistan. Like Korea, Vietnam, Cambodia, Laos, Angola, Nicaragua, and other Cold War battlegrounds, the country wasn’t worth fighting over — and certainly not by jihadist proxy. The Soviet Union was doomed to fall. All America had to do was allow the Soviets to overextend themselves in all these breadbasket countries. That over-extension is what finally brought about the dissolution of the Soviet Union in the late ’80s.

(c) Iran: Arms sales, revolution, and hostages

Carter’s most visible foreign policy failure was not his most critical one, at least in long-term effects. It is however what everyone remembers him for.

The first point to note is that Carter treated the Shah of Iran just as Nixon and Ford had. Since Nixon, the U.S. had treated Iran as the linchpin in maintaining stability in the oil-rich Persian Gulf, and so the Nixon and Ford administrations sold arms to the Shah. Carter continued those arms policies, despite his campaign for “human rights” and a softer arms sale policy. Carter was vilified by later administrations (not least Reagan’s) for his “human rights” naivete, but the fact is that in the case of Iran, Carter did not end up restricting arms sales. Just the opposite, he increased them to record levels. Even as the Shah entered his final days in mid-1978, another multi-billion dollar arms deal was being tabled with Iran. And in particular, when Carter approved the sale of the AWACS (the Airborne Warning and Control System, modified Boeing 707 jets), he went deeply against his own arms-control doctrine out of sheer pragmatism. He wasn’t naive; he and his advisers knew they needed to maintain Iran as a strong ally in a volatile region.

There was little Carter could have done to save the Shah when the Iranian people finally rose up and overthrew him, taking control of Iran on February 11, 1979, and installing Ayatollah Khomeini. If the Shah was a saint compared to the actual devout Muslim Khomeini, he was still a tyrant who had tortured people and ruled Iran ruthlessly. This is the pattern in the Islamic world. Carter didn’t “lose Iran”. The Shah lost his own country. Khomeini, like any other Islamic mullah, crystallized the fervor of devout Muslims who resented what the Shah represented in his lavish western lifestyle. There are limits to what the U.S. can do to save unpopular secular rulers who lord themselves over a Muslim nation.

Where Carter did fail was in offering the Shah sanctuary in America (in October ’79, eight months after the Shah fled Iran), instead of offering to help his old ally in a less visible way. This enraged Khomeini, and on November 4 (only two months before the Soviets invaded Afghanistan), the hostage crisis began, in which 54 Americans were taken hostage in Iran for 444 days. Carter tried Operation Eagle Claw, a sloppy rescue attempt that failed, and the rest is the history that Carter never lived down.

2. Domestic Policy

Carter was a new breed of Democrat — not a New Deal or Great Society guy who believed government should inflate the economy and be so federally expansive. He wanted effective but not big government, and to prune programs, reduce regulations, and pull the Democratic Party (fiscally) from left to center. The few federal programs he did create (The Departments of Energy and Education) were for the better. As a fiscal conservative he concentrated on curbing hospital costs, welfare reform, and reforming the inequitable tax code. Granted his fiscal conservatism was not always good. He was a bigger union-buster than even Reagan, for example. But for the most part, he was a positive inversion of the last Democratic president, Lyndon Johnson, who had slaughtered the economy. Despite the punishing inflation and unemployment during Carter’s term, economic growth was nearly as high as it was under Reagan, and he added less to the national debt as a percentage than either Reagan or George H.W. Bush.

Basically, Carter showed the potentials of a Democratic domestic policy when in good hands. Where other Democrats would have made their top priority something like national health care (not necessarily a bad thing), Carter made his the energy crisis.

(a) Energy: Landmark accomplishments felt still today

Carter wanted to reverse the nation’s wasteful habits of declining resources — the energy waste in gas-guzzling cars, and overheated, poorly insulated homes and work offices. The issue was made especially acute by the winter of 1976-77. It was one of the coldest on record, resulting in a a severe shortage of natural gas in the Northeast and Midwest.

With the National Energy Act, Carter set the country on a different energy course from which we still benefit today: incentives for home insulation and the first tax credits for solar and wind equipment; home inspections mandated for utilities to assess the cost and saving of energy conservation; $300 million to help pay for energy-conservation equipment in schools, hospitals, and government buildings; homeowners shielded from the immediate impact of rising prices by making industry absorb a good chunk of it; and a gas-guzzler tax on autos averaging less than thirteen miles per gallon.

The Act passed the House in August 1977, then stalled in the Senate for over a year, until it finally passed and Carter signed it into law in November 1978. In order to get the Senate on board, Carter embraced the deregulation of natural gas as a way to conserve the resource and distribute it more efficiently. Next year he was able to decontrol oil prices (tying it to a windfall profits tax), and then the following year got the Energy Security Act passed.

Taken together, these energy laws — the National Energy Act of 1978, Executive Order 12153, 1979 (decontrol of heavy oil), and the Energy Security Act of 1980 — made historic changes that have stood the test of time. As summed up by Eizenstat:

“Carter created a rational market-based system of pricing and selling crude oil and natural gas, a cleaner fuel that had too often been burned away in oil-field flares and now was available to industry nationwide, encouraging consumers to use less and producers to deliver more. On a broader public horizon, a conservation ethic was born in the minds of the public that permanently changed the way in which the American people and our industries and utilities consumer scarce energy resources. Things we now take for granted, everything from the way we drive to the way we live — from more fuel-efficient cars, homes, and appliances — were embedded in Carter’s new laws and eventually in our consciousness.” (President Carter: The White House Years, pp 238-39)

Of course, Carter barely got any credit for this during his term, since many of these benefits were felt only after he left office.

(b) The Environment: An Unsung Hero

Carter, strangely, is an unsung environmental hero. He was the first U.S. president to put conservation of the environment on the global agenda, starting in the summer of 1979 for what became The Global 2000 Report. He had run on a platform of clean air and water and to put an end to the godawful dams that were drying up the breeding grounds of hundreds of animal species. He properly vetoed more than a dozen dam projects across the country and designated more than forty new Wild and Scenic Rivers, protecting over 5,300 miles of National Park areas for rivers.

He also signed the Alaska National Interest Lands Conservation Act. To this date, it remains the single largest expansion of protected lands in history, more than double the size of the National Park system. It gave protection to national parks and forests, wildlife refuges, national monuments, scenic rivers, recreational areas, and conservation areas.

(c) The Great Stagflation: The crucial appointment of Paul Volcker

The economic purgatory of the ’70s was something never seen before or since in America. High unemployment, stagnant growth, and high inflation all came together at once, to produce what we now call stagflation. It contradicted what everyone believed — that inflation correlated with growth, and that unemployment led to less inflation. Economics 101 went right out the window, and no one knew what to do.

Let’s be sure we blame stagflation on the right people. It first goes to Lyndon Johnson, for his (overlong) funding of the obscene Vietnam War combined with his (over-ambitious) Great Society programs, without raising any taxes to pay for either. The blame then extends to Richard Nixon, for his imposition of wage and price controls, and his demands that Arthur Burns — whom he appointed as chair of the Federal Reserve — supply an expansionary monetary policy by printing massive amounts of money.

During the first part of his term, Carter rightly saw inflation (not unemployment) as the greatest threat to the nation’s growth. He tried everything to stop it: tight budgets, tough wage and price guidelines, a labor-management advisory board, and deregulation — it all amounted to throwing pebbles at a dinosaur. Finally he took the most courageous step in his entire presidential career: in August 1979 he appointed Paul Volcker to chair the Federal Reserve. He chose Volcker in the full knowledge that this hyper-budget hawk would do exactly what it took to save the economy. Volcker’s tight money policies and high interest rates squeezed inflation out of the system at the cost of high unemployment — and guaranteed 100% to squeeze Jimmy Carter out of a second term. The Democrats cried for his blood.

The long term benefits to the country can’t be understated. Volcker’s tight money policies led to the prosperity of the Reagan years in the ’80s, and it set the precedent for Alan Greenspan’s similar approach which led to the renewed prosperity of the Clinton years in the ’90s. The bum rap Carter gets comes from people who don’t know how to evaluate the economy. The effects of a president’s economic policies are often delayed, with the impact registering after the president leaves office. This is especially true of one-term presidents. Even though the economy was miserable during Carter’s term, the stagflation was caused by the sins of Johnson and Nixon. And even though Volcker’s tight money policies yielded the recession of 1981, that was the necessary phase which brought inflation all the way down from 13% to 4%. Since 1982 there have been only two recessions (’90-’91 and ’07-’09), and thanks to Volcker’s legacy, the U.S. economy performed better in the twenty years after Carter than in the twenty preceding him.

Carter’s advisors told him he was doomed, and he knew it. No president has ever been re-elected during a recession for which he can be blamed. His advisors even recommended federal spending increases and tax cuts to off-set the recession somewhat, but Carter commendably refused to enact any band-aid solutions. He stuck to fiscal restraint. Eizenstat’s judgment is a breath of fresh air and frankly common sense:

“Paul Volcker saved the country from economic disaster, and it is another of Jimmy Carter’s unheralded legacies that he overrode objections within the highest levels of his own administration to appoint him. Ronald Reagan is given due credit for standing behind Volcker even under pressure from the ideologues on his Republican team. Yet there is an unwillingness to give Carter anything close to equal billing. It was harder for Carter to show the restraint he did in an election cycle, never once criticizing Volcker’s strong medicine, than for Reagan to do so after his own election and long before he had to face the voters a second time.” (President Carter: The White House Years, p 340)

Absolutely right.

3. Liberty

If Carter was a fiscal conservative, he was a also a populist liberal who cared for the poor, and was committed to equal rights for minorities and women. He supported the Equal Rights Amendment, which aimed to ensure that women were treated equally in society. He pardoned protesters who avoided the draft. He favored the decriminalization of marijuana. He avoided the tendency of post World War II presidents to support communist-hating dictatorships that committed human rights violations. But sometimes Carter’s criticisms of other nations didn’t help, and in one case did considerable harm. His blasting of South Africa’s racist policies caused its white supremacists to persecute blacks even more, and their fury at Carter is precisely what caused the election of Prime Minister John Vorster, who believed in apartheid. If Carter showed military and economic restraint, he didn’t always show restraint as a spokesman. Still, on whole, his liberty record is very good.

Conclusion

The tragedy of Jimmy Carter is that his image was crushed by two purposeful figures: Ayatollah Khomeini and Paul Volcker. The latter resounds to Carter’s credit and unsung glory. The former he has never lived down. Here’s how I score him:

Peace (foreign policy). For a generally outstanding policy of military restraint, Carter would get high marks, but for his trio of sins which are not trivial — the Israel-Egypt treaty, arming Islamic radicals in Afghanistan, and the Iran hostage debacle — he must be downgraded a full 11 points (4/4/3, respectively), for a score of 9/20.

Prosperity (domestic policy). For his landmark energy bills, causes for the environment, fiscal restraint, overall sound priorities, and above all for appointing Volcker to the Federal Reserve, he gets a very high score. Carter saw that there was no remedy to stagflation except by painfully squeezing inflation out of the economy with higher interest rates and higher unemployment — by fighting inflation through a slowdown or even recession. It was a dark road to the nation’s redemption, but Carter said outright that he would rather lose the next election than leave the country an economic shambles. Any quibbles I have over his domestic policies (like union busting) are overshadowed by all of these positives, especially the last.

Liberty. An excellent record, though I dock him 3 points for his sometimes irresponsible and inflammatory rhetoric, which in one particular case produced worse results.

Peace — 9/20
Prosperity — 18/20
Liberty — 17/20

TOTAL SCORE = 44/60 = Good

I hope that Eizenstat’s book will become the authoritative take on Carter. I don’t agree with everything he says, but he gets a lot right that most don’t, and he’s certainly correct that Carter way outshines the more widely cherished two-term Democrats like Lyndon Johnson and Barack Obama.

3 thoughts on “The Last Good President: Jimmy Carter (1977-1981)

  1. You give Jimmy Carter FAR too much credit for Volcker. Lets take an in depth look at Carter at the inflation situation.

    1) Carter’s pre Volcker relationship with fed chairmen – Carter fought with Arthur Burns over his tightening of interest rates. Then he replaced Buns with William Miller, who pursued an expansive monetary system with exuberated the inflation issues the country was already having.

    2) Volcker wasn’t Carter’s first choice, he was kind of stuck with him out of desperation – After his malaise speech, and in an effort to boost his political chances, Carter removed five cabinet members, the Secretary of Treasury among them. When he couldn’t find anyone from the private sector to take the position at treasury, Carter promoted Miller from the Federal Reserve. With the markets in a tizzy, Carter had to quickly replace the fed chairman, but once again he couldn’t find anyone in the private sector willing to take the job, so he had to promote from within, and he picked Volcker, who was the natural choice.

    3) Carter may have believed he could influence Volcker due to Volcker’s previous work in the Nixon administration – As undersecretary of Treasury during the Nixon administration, Volcker basically authored the administrations policy that ended the Bretton-Woods agreement and removed the country from the gold standard. Even though Volcker had the reputation as a tight money guy, Carter could have believed that Volcker would be willing to play ball with the administration.

    4) Carter asked Volcker not to raise interest rates – Carter also asked Volcker to use other means to lower inflation in 1980, which Volcker tried, that ultimately plunged the economy into a recession. Carter even stated in his memoirs: “Our trepidation about Volcker’s appointment was later justified.” Carter didn’t support Volcker, he lamented appointing him.

    5) Carter didn’t sacrifice his election chances by appointing Volcker – By the time Carter turned to Volcker, inflation was running out of control and already in the double digits. Carter had to do something about inflation. When people were asked the biggest concern facing the nation during Carter’s term, the number one answer was: “Inflation and the cost of living.” If Carter didn’t fix the inflation issue, or at least appear to be doing something about it, he would certainly lose the election. There was no gallant martyrdom on the part of Jimmy Carter.

    6) Volcker was not singularly responsible for the end of inflation and the good economy that the United States enjoyed from 1983 to 2007. Volcker was certainly vital to curing inflation, but he really only deserves about half of the credit for fixing inflation. Volcker fought inflation from August of 1979 through the end of 1981 with little affect. In October the Reagan Tax cuts started to be phased into the economy. As these tax cuts were phased in every six moths over a two year period, inflation started to go down. Reagan’s tax cuts raised economic demand which created more demand for money. In 1983 Volcker had to reverse course and add money back into the economy to keep up with the booming economy. Volcker’s monetary policies should get half the credit for lowering inflation, Reagan’s economic policies should get the other half.

    7) eradicating inflation was only half of the economic story – From 1929 to 1940 inflation only went above 3% for two years, never hit 4% and was actually negative for seven of the 12 years. Low inflation doesn’t guarantee good economic times. The economic recovery from 1983 on is the bigger story, and the catalyst of that was the Reagan tax cuts. Even if you divide what deserves credit for the good economy 50/50, the tax cuts by Reagan, as well as other economic programs he introduced, get a full half of the credit. So it would be 75%Reagan and 25% Volcker, when accounting for Reagan’s half of curing inflation.

    8) Whereas Carter worked against Volcker, Reagan worked with him. Reagan provided political cover for Volcker and stayed the course even when it was costing him politically. Reagan could have easily blamed Volcker for the bad economy, especially since Carter appointed Volcker in the first place. It was Reagan that took the political risks for Volcker’s policies. Reagan’s approval ranking was 68% in May of 1981, by January of 1983 it was down to 35%, how many Presidents wouldn’t have started looking to the next election long before then and reversed course? Volcker even stated that the Fed “has got to operate…within the range of understanding of the public and political system.” Reagan deserves more of the credit for Volcker than Carter does, because Reagan actually worked with Volcker. As unpopular as Volcker was in 1981 & 1982, he could have been squeezed out of the FED had Reagan not taken the heat for Volcker’s monetary policy.

    Carter shouldn’t garner more than 2 points in prosperity for appointing Volcker, as Volcker was only part of the economic puzzle and Carter worked against Volcker and made the problem worse with Miller and his economic programs.

  2. I’ll have to ponder all of that, but as always I appreciate your diligent replies.

    However, I did adjust the Elder Bush upwards again, because I thought I was too harsh with the bailout penalty, and also I think he deserves the bonus points I usually assign presidents who go against their party and doom themselves to a single-term presidency (like Tyler, Arthur, and Carter). So I was inconsistent in my standard there.

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