David R. Henderson  

My Recollections of the 1970s

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Bryan's question is tough to answer. In the culture and in the media, things are so much better now, in the sense that the mainstream media feel the need to contend with libertarian and free-market ideas. They didn't feel that need back in the 1970s. In the political and economic arena, it was worse in some ways and better in others.

Ways it was better.

1. Short-term slavery for young American males was ended in 1973. That's huge.
2. As has been mentioned, the 1970s ended with deregulation of trucking, railroads, and airlines.
3. The U.S. government was temporarily humbled by its loss in Vietnam and for a few years did not intervene nearly as much in the rest of the world. I remember being a commenter on WXXI in Rochester, NY after President Carter's 1979 State of the Union speech. He had bragged that not one member of the U.S. military had died in a military conflict the previous year. Although in my comments I was critical of pretty much everything he had done in domestic policy, I gave him credit for that one.
4. There was a growing free-market, anti-regulation movement among economists, even mainstream economists, starting in about 1977.

Ways it was worse.
1. Nixon had imposed price controls so that when the OPEC price increase hit in late 1973 and his price controls restrained the price of crude oil ("old" oil sold for $4.25 a barrel while the world price exceeded $11) and the prices of refined products. Result: shortages, line-ups, and a partial Sovietization of the U.S. economy. Ford continued Nixon's policies and signed the CAFE bill which is still haunting us. Carter pushed on by regulating temperature of buildings and imposing many other energy restrictions.
2. Inflation was out of control, hitting high single digits and occasionally low double digits. It was throwing middle-income people into mid-30 percentage points marginal tax brackets. Many mainstream economists worried in the late 1970s that the wheels were coming off. This was not due to higher oil prices.

Comments and Sharing

COMMENTS (13 to date)
bill woolsey writes:

It wasn't just high inflation, it was the trend on inflation that was worrisome. Look at the figures today. Inflation may have been 10% in 1979, but would it be 15 percent in 1985? Twenty percent in 1990?

David R. Henderson writes:

Bill Woolsey,
Well put. That' what I meant when I said that economists worried that the wheels were coming off.
Thanks for clarifying.

chipotle writes:

Alright, that's enough.

Someone has to say it: The kids of today should defend themselves against the 70s.


Recorded in 1995, sadly relevant today.

Adam writes:

Elimination of the draft was a win for liberty. However, why exaggerate by calling the draft "slavery"? Draftees were not "held as chattel". There were alternatives to military service such as alternative service, going to jail and angling for a dishonorable discharge. Draftees retained rights, including the right to make contracts and hold property. Better said, the draft was temporary form of involuntary servitude or serfdom.

Regarding how things were better in the 70s:

--deregulation was a great step but its consequences were tiny during the 70s. Were trips to Europe suddenly cheaper? I don't recall; I was hard at work trying to grow a tiny wage faster than inflation. The substantial benefits of deregulation were not realized until well into the 80s and 90s.

--It may have been good that the Vietnam defeat humbled our central government, but it also gave the government a cause--rebuilding it's military and proving it's capability, a cause we still live with. The war also left millions of devastated and dead people in both the US and southeast Asia. The devastated included 60,000 US soldiers and 1.2 million Vietnamese soldiers died. More than 300,000 US soldiers came home injured. Millions died after the war in purges and cleansing. In the US, the Vietnam war turned millions of Americans away from traditional American values of freedom, individualism, and liberty, moving them to sympathize with Marxist causes and goals. Many of our current politicians can date their socialist ideologies to that time. I doubt that Che Guevara would be on t-shirts now if it were not for the alienation that resulted from Vietnam war.

--There was indeed a 1970s countercurrent among economists and in conservative politics. Friedman and Reagan were paramount examples and allies. But economists were a minority among the elite and an even tinier fraction of the general population. Moreover, the general economic benefits of the freer market countercurrents didn't arise until after Jimmy Carter's utter failure and long after 1980 election. Inflation was still almost 14 percent in 1980 and the prime rate remained over 21% in 1982! Moderation in inflation and interest rates wasn't seen until the 1983 recovery.

We were a long way into the 80s when we finally escaped the economic consequences of the 70s. Looking around today, however, I doubt we've yet to escape the psychological, ideological, and political consequences.

John Jenkins writes:

So, it's not slavery if you have the option of imprisonment rather than working? I don't think that word means what you think it means.

So, can anyone say for certain what the LAST year was that no U.S. military personnel died in a military conflict?

David R. Henderson writes:

I agree with much of what you wrote and most of it doesn't contradict what I wrote.
You correctly point out that the draft is not chattel slavery. Which is why I didn't use the term "chattel slavery." The fact that the word "chattel" is put in front of the word "slavery" to describe a particular form of slavery suggests that there are other kinds of slavery. The draft is one.
Deregulation: I agree. The main consequences were in the 1980s and 1990s. But for those of us who were cheering for it in the late 1970s, we could start envisioning those consequences. To some extent, I'm judging things in wealth (present value of consumer surplus) terms rather than in income terms.
Vietnam: I agree but I go further. It was good that the U.S. government's failure in Vietnam humbled it. And you're right that those other ugly consequences followed. Another unintended consequence of government intervention.
Point about economists and the culture: I agree and it's a point I made in the second sentence of my post.

John Jenkins writes:

Looks like I can answer my own question. According to the DoD, the most recent year that no military personnel died to hostile action (or terrorist attack) was 1999 (2000 if you exclude terrorist-caused deaths, but that seems to be splitting too fine to me).


Arthur_500 writes:

The elimination of the Draft did indeed eliminate a certain short-tem slavery. One could argue that the oportunity to mix american males, send them all over the country and teach them certain forms of discipline, organization, respect and leadership was a valuable asset to our nation that was lost. I often wonder if some of the irrational exuberance of the last twenty years would have been somewhat tempered if more had had some of those experiences and opportunities.

That said, I'm not advocating for wars.

On the other hand, American males have endured increasing slavery of another kind - discrimination in reverse. This is especially true of white males.

Women have gained many advantages, including not having to register for the draft as men do. I advocate getting the best tools you can to do a job and that does not include discrimination due to non-important factors such as race, color, or creed. However, from the Draft Registration through school scholarships and grants on to actually getting in to schools or jobs, our males have been discriminated against as we try to make things right.

Regretfully, privileged people and/or groups never capitalize on their unfair benefits. You only learn to ride a bicycle when the training wheels are removed and your skin is on the pavement.

Ted Craig writes:

A couple of comments about politics in the '70s. For three presidential elections in a row ('72,'76,'80) you had candidates (Wallace, Carter, Reagan) taking an anti-Washington stance with increasing success. I'd also point out that while Nixon may have proclaimed himself a Keynesian in 1971, the tide turned by mid-decade. Hayek won the Nobel prize in 1974, Friedman in 1976 and Gerald Ford vetoed dozens of spending bills in between.

David R. Henderson writes:

@Ted Craig,
Good points, but one correction. Wallace didn't run in any of those years. He was shot in '72, putting an end to his candidacy. His big year was '68.

Erich Schwarz writes:

How does having had the Marxist dictatorship of North Vietnam successfully invade and enslave South Vietnam in 1975 count as an advance for human liberty?

Ted Craig writes:

Wallace was shot in May 1972. He had won 42 percent of the vote in the Florida primary before that happened. He went on to win the primaries in Michigan and Maryland after that. Michigan was a direct vote against school busing.

David R. Henderson writes:

@Ted Craig,
You're right. I had forgotten about those primaries. I shouldn't have. He was shot while campaigning in the Maryland primary.

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