Balanced on a Razor’s Edge: Gerald Ford, Inflation, Recession, and the 1970s Economy

In 1974, when Gerald Ford assumed the presidency amidst a constitutional crisis, public opinion polls showed that the top concern among Americans was something other than the Watergate scandal. It was inflation. Prices shot up at a staggering 11 percent for the year, a rate that could destroy consumer confidence and shatter the economy. When Ford left office, he reflected, “The fight against inflation provided the basic theme of my administration.”

What was Ford’s policy to fight inflation? History textbooks get it wrong. As Ford’s chief weapon to fight inflation, they cite the “WIN” program—“Whip Inflation Now”—a voluntary anti-inflation campaign to rally consumers. But as a mere public relations initiative, WIN was no more than an adjunct to Ford’s main economic policy. In fact, he abandoned WIN after three months.

The reason Ford dropped WIN constitutes an important part of the 1970s economic story. In late 1974, the country slid into a deep recession. Ford then had to fight two enemies simultaneously—inflation and recession. These twin foes carried terrible political implications, threatening any chances that Ford could win a full term as president.

Ford’s record against inflation carries important lessons for policymakers today. Inflation went down during each year of his presidency, so that by the time he left office, it ran at less than five percent. This fifty percent decrease in inflation remains one of the underrated achievements of the Ford presidency. This paper will examine how Ford tamed the beast of inflation and why this policy accomplishment deserves closer attention from historians.