Tuesday, March 26, 2013

RN: The Memoirs of Richard Nixon, Volume 2: 10

I have two items for my write-up today on volume 2 of Richard Nixon's memoirs.

1.  For my first item, I'll use as my starting-point something that Nixon says on pages 288-289.  The topic is President Nixon's controversial impounding of federal funds, his refusal as President to spend all of the money that the U.S. Congress had appropriated for certain programs:

"The major public battles in the executive-legislative conflict were also being fought on the issue of the impoundment of funds.  Presidents since Thomas Jefferson had considered it their prerogative, and indeed their responsibility, to withhold the expenditure of congressionally appropriated funds for projects that were not yet ready to begin or if inflation was especially severe and putting more money into the economy would make it worse.  This is known as impoundment.  In fact, as of January 29, 1973, I had 3.5 percent of the total budget impounded; Kennedy impounded 7.8 percent in 1961, 6.1 percent in 1962, and 3 percent in 1963; Johnson impounded 3.5 percent in 1964 but increased steadily to a high of 6.7 percent in 1967.  The Democratic Congress had not challenged my Democratic predecessors for their heavier use of the practice, so I saw the 1973 impoundment battle as a clear-cut partisan attack on me."

I first learned about the impoundment issue in a college course on American government.  The professor was telling us (if I recall correctly) that the articles of impeachment that were being drawn up in Congress against Nixon dealt with more than Watergate, for they included a criticism of Nixon for impounding funds, that is, for not spending all of the money that Congress had appropriated for certain programs.  As a Republican at the time, I somewhat admired Nixon for this.  Here was a President who was unilaterally taking the initiative to control government spending.  Of course, he went over Congress' head to do this, but how often do checks-and-balances stand in the way of doing the right thing?  How I feel about this sort of thing nowadays, I'm not sure.  I admire President Barack Obama when he goes over Congress' head by issuing executive orders that advance his progressive agenda.  At the same time, I think that checks-and-balances are important in terms of the United States being a republic of laws, rather than a country that is ruled by the whims of human beings.

Nixon's reference to the impoundment issue occurs within the context of his larger discussion of the importance of controlling government spending.  One reason that Nixon wanted to control government spending was that it was inflationary, presumably because it put more money into the economy, plus it could lead to tax increases.  Another reason was that he thought that the government was wasteful.  Nixon gives a variety of examples of this waste on pages 279-281: the richest 7 percent of farmers received 42 percent of the farm subsidies; there was a surplus of teachers, yet a federal program was encouraging students to enroll in teaching programs; the government was still subsidizing the construction of hospitals, when there was a surplus of hospital beds; and 85 percent of the money for the Office of Economic Opportunity went to "salaries and overhead before it ever reached the poor" (page 281).  Third, Nixon thought that there were too many government bureaucrats, and that most of them were Democrats or liberals.  In retrospect, however, Nixon felt that he undermined morale when he demanded the resignations of all of the White House staff and members of the Cabinet (even though he did not accept many of the resignations).

This discussion was interesting, since elsewhere Nixon brags about his role in increasing government spending for certain programs.  Perhaps Nixon would say that, yes, he did that, and he was right to do that, but he sought to do so while regulating the overall government spending.  Something else that enters my mind is a statement that Nixon made on page 640 of volume 1 of his memoirs: "The budget I submitted in January of 1971 was set to be balanced at full employment and run a deficit to help take up the slack when unemployment was high."  That tells me that Nixon may have thought that there was a time for deficit spending, and there was a time for greater austerity.  My impression is that Paul Krugman feels similarly: when unemployment is fairly high and people are not spending much money, that is not the time for the government to cut its own spending, for the government needs to put money into the economy to stimulate growth; when more people are working and spending, however, that's an opportune time for the government to cut back and pay off its debt, and the government would be adding inflationary pressures by putting more money into the economy.  But what does one do when there is stagflation----high unemployment and inflation?

2.  I have said in previous posts that Nixon did not have too much of a problem with dirty tricks.  Nixon regarded many of them as pranks, plus he noted that Democrats did them, too.  An example of such a prank would be Donald Segretti of the Committee to Re-Elect the President sending out fliers "inviting people to an open house with free lunch and drinks at Humphrey's headquarters in Milwaukee" (page 292).  Nixon does seem to draw the line somewhere, however, or at least that's what Nixon tries to imply: "But [Segretti] crossed the boundaries of pranks when he sent out phony letters on stationary from different Democratic campaign offices claiming that two of the Democratic candidates had records of sexual impropriety and that another had a history of mental instability" (page 292).

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