Gerald R. Ford’s Greatest Achievement
What was Gerald R. Ford’s greatest achievement as president?
Some Americans may struggle to answer this question. Respondents familiar with Ford’s tenure in office may cite his role as a “healing” president who calmed overwrought passions after the Watergate scandal and restored integrity to the White House. Ford’s leadership allowed the country to experience the 1976 Bicentennial celebrations with a unity and bipartisanship that seemed unthinkable just two years earlier, when Richard Nixon resigned the presidency amidst rancor and disgrace. In fact, Ford himself recognized this contribution of his presidency by entitling his memoirs A Time To Heal.
But Ford’s greatest achievement was something else—an accomplishment that is easy to overlook and hard to appreciate. Yet it is quantifiable. It is a feat that history books fail to mention, or worse, get wrong in their retelling of the story. It is time to set the record straight.
Gerald Ford tamed a beast. In the 1970s, the beast that browbeat and bullied Americans was a powerful economic force: inflation. During that decade, a witches’ brew of high oil prices, elevated wages, and high federal spending imposed greater costs on the economy and stimulated inflation. In 1974, the year Ford took office, it hit an average of 11 percent—an ominous "double-digit" pace and the highest annual rate of price increase since 1946. Such pernicious inflation hurt everyone, regardless of age, gender, race, or ethnicity. Even children felt its harsh hand. Just after Ford took office, a ten-year-old boy from Tennessee wrote to him, pleading, "I didn't buy as many baseball cards this year because they went up from 5 cents to 15 cents. So did football cards. I hope you stop inflation soon!"
A half-century later, during the 2020s, the resurgence of inflation illustrated how this scourge batters consumers and how presidents have struggled and failed to stop it. In 2022, inflation peaked at an eight percent average. President Joe Biden appeared unable to define his enemy, seeking both foreign and domestic scapegoats, blaming Russian President Vladimir Putin (criticizing “Putin’s price hikes”), supply chain disruptions, and even American grocery stores for the high cost of living.
Biden joined a list of presidents who appeared stymied in stopping inflation. In the 1960s, Lyndon Johnson unleashed a flurry of federal spending for both the Vietnam War and Great Society domestic programs—the reckless mess of “guns and butter” that spurred price increases. By 1968, LBJ’s last full year in office, inflation ran at 4.3 percent, after standing at just 1.3 percent in 1964. Nixon fared worse, presiding over a steady rise in inflation, which hit six percent in 1973, his last full year as president. Most feckless of all was Jimmy Carter, who saw inflation gallop away under his watch, reaching eleven percent in 1979 and thirteen percent in 1980, contributing to his resounding defeat in that year’s election.
Gerald Ford was different. He had majored in economics at the University of Michigan, and he understood economic policy and the federal budget perhaps better than any president in history. Moreover, he enjoyed grappling with these issues, so when he inherited an inflation-wracked economy, he pursued solutions with determination. On October 8, 1974, two months after becoming president, Ford addressed a joint session of Congress and introduced a mélange of more than thirty anti-inflation initiatives, the heart of which was a one-year, five-percent surcharge on corporate and personal incomes—a tax increase. But on Capitol Hill, that idea fell flat. The 1974 midterm elections were one month away, and a tax increase was as popular as poison ivy; congressmen refused to touch it.
During the October 8th speech, Ford pinned to his jacket lapel a button that had three letters on it: WIN. Ford announced plans for a citizens' crusade—Whip Inflation Now, or “WIN”—with a White House coordinator and staff, which would harness Americans’ volunteer spirit and battle rising prices through public relations and consumer empowerment.
Historians have wrongly interpreted WIN as the heart of Ford's anti-inflation policy. In the little space they devote to the Ford presidency, U.S. history textbooks always mention WIN, giving it prominent billing. Yet that construction is inaccurate—in fact, a grievous error. Ford never engineered this campaign as his economic program's centerpiece. He saw it as only a consumer-oriented initiative and “a supplement” to a more substantive anti-inflation program.
That statement is the historical truth: WIN was but an asterisk in Ford’s anti-inflation calculus. As testimony to its tiny role, Ford dropped WIN after just three months. He abandoned it because it was “too gimmicky,” as he later acknowledged, but even more so due to a phenomenon that haunted the rest of his presidency—the worst economic downturn since the Great Depression.
By late 1974, the economy slipped into a deep recession, with unemployment hitting 8.9 percent by May 1975, the highest jobless rate since the Great Depression. Ford faced a vexing dilemma. The prescriptions for fighting inflation and recession are mirror opposites. Inflation reflects an overheated economy, which may be ameliorated with a tax increase, as Ford had proposed. But to combat recession, the economy needed stimulus—such as a tax cut. The Economist magazine said that Ford confronted “the worst of all possible worlds.” He was balanced on a razor’s edge, walking a fine line between inflation and recession.
As Ford later wrote, his new task would be to "reverse completely the economic strategy . . . adopted during the first three months of my presidency."
By late 1974, the surtax proposal and WIN were dead, as Ford began to formulate an anti-recession program.
Some members of Congress and the media wanted an infusion of federal spending to beat back the recession. Ford demurred. The explanation for his stance lay in his relentless anti-inflation focus. Ford feared higher federal spending would ignite more inflation, which he estimated could hit 12 or 14 percent, and then precipitate an even worse recession. He had to avoid that vicious cycle. Alan Greenspan, who chaired Ford’s Council of Economic Advisors and later served as Federal Reserve chair, said Ford's resolve to resist spending pressures was prudent and politically courageous.
In January 1975, Ford proposed a one-year, temporary tax cut of $16 billion to jolt the economy out of the recession. Just three months earlier, Ford had appeared before Congress and asked for a tax increase. Now he supported the exact opposite—a tax cut—and with much prodding, he induced Congress to pass a massive $23 billion tax cut by late March. Ford had reacted quickly to changing economic circumstances, and because his tax cut was so swift, it took effect by May 1975. In June, unemployment edged down from 8.9 percent to 8.6 percent. At that time, Greenspan told Ford the recession had "bottomed-out."
No chief executive likes to preside over a recession, especially the year before an election, and the downturn hurt Ford politically. In February 1975, his public approval rating plunged to thirty-six percent, as joblessness swept through the nation. Yet during the dark days of recession, Ford wisely saw inflation as still the principal enemy. Whereas unemployment was a temporary problem affecting fewer than 10 percent of workers, he reasoned, inflation was more tenacious and widespread—"the universal enemy of 100 percent of our people," as he put it.
After Ford left office, he stated, “The fight against inflation provided the basic theme of my presidency.” This august battle stands as Ford’s most notable success. An irony was that the baneful 1974-75 recession, which battered him politically, helped to beat down inflation. It slowed the economy, wringing out inflationary pressures. Thus inflation, the economic terror of the 1970s, went down during every year of Ford's presidency, from 11.0 percent in 1974, to 9.2 in 1975, and 5.7 in 1976. In January 1977, when Ford left office, inflation stood at just 4.8 percent—one of the lowest rates in the Western world.
The recession helped in this fight, but what also contributed to Ford’s success was his prioritizing inflation and a policy to break its back. Ford had a coherent anti-inflation plan—and it was not WIN buttons. It was fiscal and monetary policies working together to bring down inflation. While Ford was still vice president, he said that "the basic solution [to inflation] is fiscal and monetary restraint." As president, Ford used these two macroeconomic levers in tandem, skillfully sticking with the combination.
Presidents do not implement monetary policy and should never interfere with the Federal Reserve. But a president may endorse or criticize Fed policy, and Ford supported a tight monetary policy to decelerate inflation. He met regularly with Fed Chair Arthur Burns and discussed economic policy with him. Burns called Ford “truly angelic” in his behavior toward the Fed because the president respected its independence yet gave Burns political cover for tight monetary policy, which is painful and unpopular because it shackles economic activity with high interest rates. In 1975, the Fed hiked interest rates to 14 percent, which was an excruciating but potent way to squeeze inflation out of the economy.
On the fiscal side, Ford tried to restrain federal spending. One way he did so was through vetoes. Herein lies another Ford achievement that history texts fail to mention. After leaving office, Ford and his administration members spoke with palpable pride about his veto record. In just two and a half years, Ford issued 66 vetoes. This executive restraint pared $42 billion off federal budgets, curbing inflationary stresses. James Lynn, the director of Ford’s Office of Management and Budget, said admiringly that Ford used the veto “like a scalpel” to trim fat off the federal budget, reducing wasteful spending and upward pressure on prices.
Herbert Stein, who chaired Nixon’s Council of Economic Advisors, called Ford's policies "resolute and responsible." To fight the recession Ford "had to resist temptations and demands for strong action to pump up the economy. He had to be willing to accept. . . sacrifices in the form of unemployment in order to avoid the continuation of double-digit inflation. . . He did what had to be done, directly through his support of the restrained policy of the Federal Reserve."
Perhaps the most notable tribute to Ford’s success against inflation came from Ronald Reagan, who had challenged him for the 1976 Republican nomination. Ford’s erstwhile rival came to respect his presidential record and in 1980 even asked him to be his running-mate (Ford considered the offer but declined). In the 1980 presidential debate against Jimmy Carter, Reagan noted that inflation was “cut in two by President Gerald Ford.” He added, “It is now running at 12.7 percent.”
Ford got the job done. Historians should recognize the 38th president’s greatest achievement and note it in their textbooks. Where other presidents failed to do so, Gerald R. Ford tamed the beast of inflation.
Yanek Mieczkowski is a University Professor and Director of the Theodore Roosevelt School at Long Island University.
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