By Amy Cooke
Are the ’70s back? Hopefully not the fashion, but I’ll take the music. Tube socks with short shorts are a bad look for most people. Yet the world would be a better place if we listened to a little more “Saturday Night Fever” and Yacht Rock.
Two things I had hoped we’d never relive from that decade: politics and the economics. Increasingly, it’s looking more like we haven’t learned the lessons of history. Recent polls show that 80% of voters believe America is headed in the wrong direction. Economic insecurity and political polarization have infected the country and appear harder to cure than COVID.
Watergate was a national embarrassment as well as a shocking criminal enterprise. Solid investigative journalism and federal officials who put the country ahead of political power followed the money and exposed the crimes. People were held accountable. President Richard Nixon resigned, and top officials from his administration went to prison, deservedly so. The country could heal.
Today we have the Russia collusion hoax. It’s worse than Watergate because of the damage done to institutions beyond the executive branch. Years of investigating and millions of taxpayer dollars later, we finally find out what many suspected. Hillary Clinton ordered it.
According to testimony from campaign manager Robby Mook, candidate Clinton approved fabrication of the Trump-Russia collusion narrative and handed it to an eager press that never bothered to confirm it. The fake news was reported as true. The campaign also peddled it to the FBI, providing cover for media to keep reporting it as if it was legitimate.
The Wall Street Journal editorial board opined, the fake Russian collusion story “disgraced the FBI, humiliated the press, and sent the country on a three-year investigation to nowhere. Vladimir Putin never came close to doing as much disinformation damage.”
I doubt Americans will see much, if any, justice for what’s been done to them. The media won’t come clean. It’s unlikely Clinton will be held accountable in any serious way. Washington, D.C., lacks the political will to clean house at the FBI and CIA. It proves that for some, the end justifies a by-any-means-necessary method of operation. No wonder Americans have so little regard for or faith in elite institutions.
As for the economy, turn on any cable news outlet. You’ll probably find an economist making comparisons between current economic conditions and those of the 1970s. Baby Boomers remember all too well the wretched economy, stagflation, and its descriptive data point – the misery index. There’s real fear that ’70s-style stagflation will rear its ugly head soon.
Stagflation is the combination of persistent high inflation and unemployment, coupled with slow economic growth.
Larry Summers, former Treasury Secretary for President Clinton, wrote recently, “The Fed’s current policy trajectory is likely to lead to stagflation, with average unemployment and inflation both averaging over 5 percent over the next few years — and ultimately to a major recession.”
One indicator economists watch is the price of oil. In the ’70s, the OPEC oil embargo on shipments to the United States resulted in high prices, long gas lines, and rationing. High crude oil prices helped push inflation to over 14%. To fight the “Great Inflation,” the Federal Reserve hiked interest rates to a record 20% in December 1980.
Today, inflation is nearly 8%. Last time I went to the grocery store, butter was $7.49 a pound and half a loaf of bakery bread was $3.99. Shelves are bare, especially if you’re searching for baby formula.
Taken together, President Biden’s reversal of President Trump’s energy independence doctrine and war in Ukraine has sent crude prices soaring. According to AAA, the average price nationally for a gallon of gas was a record-high $4.986 a gallon on June 10. J.P. Morgan analysts predict we’ll see a national average of over $6 before the end of summer. It was $3.04 one year ago.
If what economists like Larry Summers are predicting comes to fruition, Americans are right to be worried. We’re in for some pain that won’t be resolved in a 30-minute TV show.
Amy Cooke is CEO, John Locke Foundation and Publisher of the Carolina Journal. This piece first appeared in the June-July print edition of the Carolina Journal.