Economic Issues in the 1980 Campaign
It was not a propitious time for Jimmy Carter to run for reelection: The year 1980 was not a good one for the economy. In the first half of the year, the economy was in a short, sharp recession. In the second half of the year, the economy grew at a slow rate, with the seemingly perennial stagflation. With the unemployment rate hovering around 7.4%, and the CPI growing at a rate of about 12%, the misery index (the combination of the two) was close to 20% -- a record high. There was nothing to be cheerful about, and appeals to the fact that the U.S. economy was doing better than that of some of its trading partners offered little solace to an embattled and bewildered public.
We already have seen that the administration refused to fight the recession through economic stimulation, deferring instead to the fear of exacerbating inflation. It reduced government spending by $14 billion; tightened its wage and price standards; imposed credit controls; proposed an oil import surcharge; and tried vainly to increase productivity. But as the economy foundered, the Carter administration not only had to respond to growing discontent from within its own ranks, but also had to respond to the increasingly strident criticisms of its Republican opponentsmainly Ronald Reagan.
Finally in August, after watching its credibility steadily diminish and facing mutiny from Senate Democrats who were ready to make their own tax proposals, the administration responded to the pressure and offered its economic revitalization program. When announcing his program, Carter answered his critics by eschewing political repercussions, "Now, in the heat of an election year, is not the time to seek votes with ill-considered tax cuts that would simply steal back in inflation in the future the few dollars that the average American taxpayer might get. . . . America needs to build muscle, not fat, and I will not accept a pre-election bill to cut