Politics and Economics:
1971-1980
The Nixon, Ford, and Carter
Administrations
Explain how Presidents Nixon, Ford,
and Carter attempted to lead the
United States through domestic and
foreign crises.
The Nixon Administration
• New Federalism: Nixon’s policy of dismantling
a number of federal programs and giving more
control to state and local governments.
– Policy should have given more power to local
governments, but actually made them dependent
on the federal government for funding
– When Congress appropriated money for programs
he opposed, Nixon impounded the funds
Nixon’s Foreign Policy
• Henry Kissinger – Nixon’s national security
advisor
• Détente: relaxation of tensions between the
Soviet Union and China
• February 1972 – Nixon visited China, agreed to
“more normal” relations
• May 1972 – Nixon visited Soviet Union
– Strategic Arms Limitation Treat (SALT I): limit
nuclear arms
Economic Crisis of the 1970s
• Funding both the Vietnam War and Great
Society without raising taxes = deficit
spending
– inflation
• Organization of Petroleum Exporting Countries
embargoed countries that supported Israel
– U.S. created price controls for oil
– OPEC’s increased prices and U.S. controls = oil
shortage and rising prices
A Stagnant Economy
• Decline in manufacturing sector caused by
increased international competition
– Increase in unemployed and underemployed
workers
• Stagflation: a combination of rising prices and
economic stagnation
Ford Takes Over
• September 8, 1974 – Ford granted a “full, free,
and absolute pardon” to Richard Nixon
• Ford stated he was acting in the public’s best
interest, wanted to avoid a public division
during a criminal trial
• By 1975, the economy was in its worst
recession since the Great Depression
Ford’s Foreign Policy
• Ford followed Nixon’s general strategy
• August 1975 – signed the Helsinki Accords
– Leaders of NATO and Warsaw Pact
– Agreed to recognize the borders of Eastern Europe
– Soviets agreed to uphold basic human rights,
including the right to move across national
borders
– Soviets failed to uphold there end of the deal
Carter Battles the Economic Crisis
• Carter believed the nation’s most serious
problem was its dependence on foreign oil
• Encouraged use of renewable resources and
created the Department of Energy
• Carter’s inability to work with Congress
caused many of his programs to fail
– Inflation continued to grow
Carter’s Foreign Policy
• Carter argued that the U.S. must try to be
“right and honest and truthful and decent” in
dealing with other nations.
• Treaty created to give the Panama Canal back
to Panama on December 31, 1999
• Put a grain embargo on Soviet Union and
boycotted the 1980 Olympic games in
Moscow after Soviets invaded Afghanistan
Triumph and Failure in the Middle East
• Camp David Accords (1978): helped to broker
a peace treaty signed between Israel and
Egypt
• Iran Hostage Crisis (1979)
– American supported Iranian Shah overthrown
– November: American embassy in Tehran stormed
and 52 hostages taken
– 1980: failed rescue attempt
– Hostages released the day after Carter left office –
444 days in captivity