Saturday, April 13, 2013

Jerry Voorhis: The Strange Case of Richard Milhous Nixon 5

My post today on Jerry Voorhis' The Strange Case of Richard Milhous Nixon (copyright 1972, 1973) will focus on economics, yet it will also get into national defense policy.  The topics of this post will overlap with those in my post on Voorhis' book a few days ago----in which I listed a number of Voorhis' criticisms of President Richard Nixon's policies----but today's post will be a little more detailed. 

Voorhis portrays the Nixon years as a time of high unemployment, inflation, and slow growth, and Voorhis cites statistics to argue that things got worse once Richard Nixon became President.  (Nixon in his memoirs acknowledges that high unemployment was a problem during his Administration, but he believes that he solved the inflation problem, at least for a time.)  What were Voorhis' ideas on how to improve the economy?  Voorhis was essentially for increasing demand, thereby stimulating production of products and creating jobs.  Voorhis was for the government creating permanent public sector jobs, as well as tax cuts for the middle-class rather than the wealthy.  For Voorhis, it was important to get money to the middle and the lower economic classes, since they would spend it.  Voorhis, like a number of liberals today, held that cutting taxes for the rich and expecting that money to trickle down not only was unrealistic, but it also created economic problems, particularly deficits.

Voorhis criticizes President Nixon's economic plans on a variety of grounds.  First, Voorhis says that President Nixon has raised interest rates in an attempt to tame inflation, but the effects of that have been counterproductive.  Not only has it slowed down production and thus the supply of goods (thereby contributing to inflation), since many businesses are reluctant to borrow money when interest rates are high, but the businesses that do borrow money from the banks end up passing on the cost of the high interest rates to their consumers.  Second, Voorhis critiques Nixon's support for monopolies and oligopolies, which suppress competition and thus contribute to high prices----since monopolies and oligopolies refrain from producing that much and keep prices high in order to maximize their profits.  According to Voorhis, if price ceilings were put on these companies, then they would have to keep their profits up in other ways, ways that are more beneficial to the American people, such as by producing more.  Then did Voorhis support President Nixon's wage-and-price controls?  Voorhis expresses a number of problems with them, such as their exemption of certain companies (i.e., utilities), and Voorhis notes that, in some areas, inflation has continued to go up even with the controls.

Voorhis has problems with President Richard Nixon's policies on national defense, on economic and other grounds.  Overall, Voorhis maintains that Nixon's national defense policies are fiscally irresponsible because they increase government spending, contributing to deficits, and Voorhis considers a high national debt to be bad because defaulting on that debt could be deleterious to the economy.  While Nixon portrays himself as a budget-hawk and the Democratic Congress as spendthrifts, Voorhis states, Congress is actually more fiscally responsible than Nixon when it opposes Nixon's spendthrift agenda on national defense.  But could not higher defense spending create jobs?  Voorhis acknowledges that there are many Americans who work within the military-industrial complex, but, overall, he does not believe that increased defense spending stimulates the economy.  Rather, for Voorhis, it creates only a few high-paying jobs, does not put goods on the market, and diverts production to an area that has waste (and Voorhis quotes conservative Senator Barry Goldwater's criticism of waste in military spending).  Voorhis thinks that it is wrong for the U.S. government to spend so much on the military, when there are schools in the U.S. that are closing.

Voorhis has a problem with the arms race, which he argues is continuing, notwithstanding SALT.  Nixon wants for the U.S. to negotiate with the Soviets from a position of strength, but, as Voorhis says, the Soviets probably have the same mindset!  And how many arms do both sides even need, since it takes only a few arms to wreak destruction?  Then is Voorhis for unilateral disarmament.  My hunch is yes.  On page 174, Voorhis refers to a time when the U.S. Government (under pressure from UN ambassador Adlai Stevenson) decided to halt the "testing of nuclear weapons in the atmosphere" because it was "spoiling air, water, and food", and "to challenge the Soviets to do the same."  The Soviets agreed, and the result was a nuclear test ban treaty.  I vaguely recall reading right-wingers, however, who alleged that the Soviets violated that treaty.

Richard Nixon in his memoirs said that the U.S. Government under his Administration was spending more on meeting the needs of humanity than it was on defense.  Voorhis contends that Nixon is basing this on a faulty calculation, and that the U.S. Government is actually spending more on the defense under Nixon.  Voorhis argues that support for veterans should be considered spending on defense, and he also says that Nixon counts as domestic spending programs that he had nothing to do with creating and that have their own source of revenue, such as Social Security.  (At least I thought that Voorhis made that point about revenue.)
  
One more point.  In reading about Jerry Voorhis in biographies about Nixon, I learned that Voorhis was in favor of nationalizing the Federal Reserve.  It will be interesting to read what John Bircher Gary Allen says about Voorhis in his own biography of Nixon, since the John Birch Society, while being conservative, has actually been quite critical of the Federal Reserve!  (And, peeking into that book, Allen does not seem to be particularly negative about Voorhis, or Helen Gahagan Douglas, for that matter.)  Voorhis talked some about the Federal Reserve in my latest reading of The Strange Case of Richard Milhous Nixon.  To be honest, I did not really understand what he was saying.  He's not entirely like Ron Paul, who endorses the gold standard and dislikes the Federal Reserve because it creates money out of thin air to support a growing government.  Voorhis seems to think that having a Federal Reserve is preferable to economic panics, and that some deficit spending may be necessary at times.  Moreover, Voorhis says that Nixon was probably right to undermine the gold standard.  And yet, Voorhis also appears to criticize private interests creating money out of thin air and demanding higher interest rates as a condition for purchasing government bonds.  Moreover, Voorhis, like many critics of the Federal Reserve, points out that the Constitution says that Congress has the power to coin money.  But Voorhis also makes a point that I don't understand: that the Federal Reserve regards as debt what actually is credit.  I'm not sure what he's talking about there, but he does promote nationalizing the Federal Reserve! 

No comments:

Post a Comment

Search This Blog