Summary and Critique of the Administration's Macroeconomic Policies
The previous chapters included many comments and criticisms of the Carter administration's macroeconomic policies. Inevitably, many criticisms were made immediately following the actual policies adopted. They were not, however, spelled out or put in any kind of context, and so appear to be ad hoc notes on specific policies. Now, we gather up these criticisms and try to make some sense of the administration's attempt to deal with the macroeconomic issues it faced.
The task is easier said than done. Not only must we discuss what the administration planned to do as it took office, but also how it amended these plans either in the face of actual events in the economic world, or in response to political and social pressures. No administration can control these external events, but how it reacts to them reveals a great deal about the existence of and commitment to a basic philosophy.
The Carter administration was divided into two terms. One in which it tried to adhere to its basic convictions, and the other when it appeared to abandon them. In terms of its macroeconomic policies, the first one did not last very long, less than half of the term. Buffeted by events it could not control, it vacillated, compromised, and eventually retreated. The administration was then forced to examine its convictions and found them to be fluid, especially when Carter's personal philosophy seemed to re-emerge. In the second half of his tenure, external events seemed to take control, and the administration succumbed to confronting specific issues and abandoning its rudder. It made concessions, overreacted to short-run incidents, and in general sacrificed its objectives as it was swept along by the waves it could not handle. In the process, it became difficult to discern