Kent Chronicles
January 2013
Flailing American Economy (most of the 1970s)The American economy was already strained by
funding the increased commitment to the Vietnamese
war in the late 1960s and finally broke in 1973 when
OPEC retaliated against American support of Israel by
initiating an oil embargo. The shock to the oil supply
had a profound effect on the entire American
economy, leading to rising inflation (prices rose) and
increasing unemployment (people had less money)
which is not a good thing! What was worse, the
govnerment did not appear to have a good way to help
end the economic downward trend because the
stagnant economy combined with the risk of inflation
was not a common economic condition.
The Yom Kippur War (October 6, 1973)
The war was a joint surprise attack launched by the armies of Egypt and Syria with varying degrees of
support from Saudi Arabia, Lebanon, Iraq, Libya, and Jordan. The aim was to gain back the Sinai
Peninsula (Egypt) and the Golan Heights (Syria) which were lost after the Six Day War of 1967. Initially,
the Arab nations achieved success, but after two days the tide turned and Israeli arms recouped the lost
territory and took the battle into both Egypt and Syria. An act of the United Nations effectively ended
the conflict
Why does it matter to the US?
There was a Cold War element to the fighting, Egypt and Syria used mostly Soviet made war material
while the Israelis used American made weapons. A key to the Israeli’s fighting efficiency over the length
of the war was the willingness and ability of the United States to airlift supplies into the country. The
Soviets attempted to do the same for their Arab allies but were unable to keep up with American
logistics.
Saudi Arabia had the answer for hitting back at the United States though an oil embargo that the
government initiated on October 19, 1973 and the rest of OPEC followed suit.
Intertwined in the energy crisis was the Watergate scandal. Four days after the start of the war, as the
Nixon was still working out his response to the conflict, Spiro Agnew resigned from the Vice Presidency.
The day after the embargo started, Nixon fired special prosecutor Archibald Cox. As the economic crisis
broadened the Watergate cover-up became clearer.
In 1972, the US imported ____________________ of its oil from the outside. For reference, in 2011 the
US imported 45% of the oil it consumed.
In the US, the price of a gallon of gasoline rose from about 38.5 cents in May of 1973 to about 55.1 cents
in June 1974.
Personal Effects of the Embargo
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Government and Business responses to the embargo
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The embargo was officially ended on March 18, 1974, however, the economy took years to recover and
there were other consequences that are still unresolved. The reputation of oil companies still hasn’t
recovered from the accusations of profiteering. More importantly, the federal government’s lack of
effective response raised serious questions about what role, if any, it should play in the free market. It is
safe to say that we are still arguing about that in 2013.
Environmental Protection Movement
In many ways, the early 1970s was the high water mark for optimism and action for the environmental
protection movement.
In the 1960s, a small movement developed that raised awareness about the costs that modern society
exacted on the planet. Most famously, Rachel Carson’s book, ________________________________ ,
discussed the effects that the pesticide DDT had on wildlife. When coupled with other obvious
examples of pollution both nationally and locally, the need for action was palpable.
In April 1970, 22 million Americans demonstrated the strength of concern by participated in the first
Earth Day. They clean up parks and road ways, attended talks, danced, sang, and generally showed their
support for Earth. The government, as is its custom, followed the votes.
Enter Stage, Nixon
Nixon had already signed into law the bill that created the Environmental
Protection Agency on December 2, 1970.
Other Acts that followed included:
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_____________________________________________ 1970
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_____________________________________________ 1972
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_____________________________________________ 1972
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_____________________________________________ 1973
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_____________________________________________ 1973
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_____________________________________________ 1976
Quick Benefits
Between 1974 and 1977 the number of unhealthy days in 25 major cities dropped by 15% while the
number of very unhealthy days dropped by 35%.
At What Cost?
Who pays for environmental cleanup? You will notice that most of the base line legislation that
governed environmental protection was signed before the oil embargo crashed the economy.
Washington would not be so eager to legislate for the Earth again until the mid 1990s. Why?
The EPA came to enforced miles of bureaucratic red tape in regulating the different types of pollution
that accompanied business growth. It became more expensive to build and operate because of the
restrictions placed on building materials and the management of by products.
When the economy was good there was enough support for environmental legislation, however, when
the economy flailed and unemployment rose new legislation was often reassessed. The slower business
growth became a real factor in loosening legislative restrictions. This argument is on-going.
Love Canal (1976-1978)
The Love Canal scandal occurred when a chemical company shut its doors, buried its waste, and sold the
land to the city. The city knew of the chemical waste but proceeded to build a school and housing
development. Investigations started when there was an increase in the health defects and birth defects.
It became evident that it was the chemical waste that was causing the problems. The site was mostly
cleared and families were relocated.
One response to the incident was the Superfund, which was a tax put on the chemical and petroleum
industries that was collected over five years (1980-85) which raised 1.6 billion dollars. The money was
put into a trust fund to be used to clean up hazardous waste sites.
We have three sites in Kent that were identified in the 1980s, including the Western Processing
Company site, the Midway Landfill, and the Seattle Municipal Landfill. All three sites were cleaned up
using superfund money and are still under observation.