1978 redux on steroids.
mortgage rates 17+%?
I'm coining the term in advance, "hyper-stagflation".
As President Carter appeared on prime-time television last week to proclaim and explain the long-awaited Stage II of his campaign to slow the inflation that has reached an annual rate of 10%, his manner and delivery befitted the solemnity of his subject. Seated at his Oval Office desk and reading from a prompter, the President vowed to try "to arouse our nation to join me" in the long-range fight.
One problem in Carter's effort to dramatize his program was that much of it had already leaked out. There had been divisions within his Administration over how tough a stand to take, and when to take it. And as a decision was being reached, final work was repeatedly delayed, first by the Egyptian-Israeli talks at Camp David, then by the frenetic end of the congressional session.
Other leaks had sprung from the Administration's commendable efforts to brief key leaders in Congress, business and labor, as well as reporters, on what the program would require. The advance disclosures placed a large burden on Carter's capacity for rhetoric.
As one aide put it: "How the President sounds will be as important as anything we put into this program." The President is hardly a natural orator, but he made a good try. Through the typewriter of Chief Speechwriter James Fallows, Carter's text had undergone seven drafts.
Checking a tendency toward overstatement, Carter deliberately adopted a cautious, realistic, even humble, attitude toward his struggle with inflation.
"I do not have all the answers," he admitted. "Nobody does." He conceded frankly: "We have tried to control it, but we have not been successful."
His new policy, he said, "is almost certain not to succeed if success means quick or dramatic changes. A long-term disease requires long-term treatment." But he pleaded: "It is up to us to make the improvements we can, even at the risk of partial failure, rather than to ensure failure by not trying at all." Considering the complexity of both the problem and his plans to solve it, Carter's explanation was quite clear. He contended, perhaps a bit simplistically, that he faced only three alternatives:
1) to impose mandatory wage and price controls, which business and some union leaders abhor;
2) to induce a recession, which might reduce inflation but only at the cost of high unemployment and lower business profits; and
3) to set voluntary wage and price guidelines, with the Government using whatever levers of persuasion and economic pressure it can to see that they are observed.
Jimmie Carter November 1978, read and weep.....
We are in the early stages of "Carter on steroids" presently.