The Real Legacy of Jimmy Carter

Summary

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The Radio Free Hillsdale Hour

Episode: The Real Legacy of Jimmy Carter
Date: January 16, 2026
Host: Scott Bertram
Guests: Dr. Miles Smith (Hillsdale College), Stephen Hayward (Pepperdine University)

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Overview

This episode explores the enduring legacy of Jimmy Carter’s presidency, focusing primarily on his economic policies, the era’s characteristic malaise, and the Democratic Party’s transformation. The discussion also briefly opens with Dr. Miles Smith on the U.S. Navy’s cultural and strategic crises, before a deep dive into Carter-era economics and legacy with author Stephen Hayward.

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Segment 1: The U.S. Navy’s Strategic and Cultural Identity Crisis

Guest: Dr. Miles Smith
Timestamps: 01:05–19:18

Key Discussion Points

• Cultural Drift and Leadership

  • The U.S. Navy, once defined by Judeo-Christian values and a clear Western liberal identity, has lost strategic and spiritual focus.
  • “The Navy for a long time understood itself as this kind of defender of a Western liberal democratic republic… But I don’t think that’s necessarily what the Navy, not just the Navy, but the military, thought they were doing.” (Dr. Smith, 01:24)
  • Recent leadership changes show signs of a return to tradition and values under Admiral Caudle.

• Complacency and Geopolitical Rivalry

  • Americans take maritime dominance for granted, not realizing that maintenance requires constant effort.
  • China is rapidly increasing naval capacity, drawing parallels with Germany’s challenge to Britain pre-WWI.

• Strategic Isolation and Raw Tonnage

  • Senior naval leadership may be “sleepwalking into defeat” by underestimating the importance of raw ship numbers, as China rapidly expands its fleet.
  • “Since 1980, 87% of our shipbuilding capacity is gone.” (Dr. Smith, 05:02)

• Spiritual and Cultural Foundations

  • The navy's effectiveness historically drew from moral confidence rooted in Western and Christian values.
  • “Secularism at its best is actually an outgrowth of Christianity… [Sailors] should kind of know the world they’re fighting for.” (Dr. Smith, 11:33)

• Logistics, Modernization, and Global Commerce

  • U.S. capacity for shipbuilding and logistical support eroded, while China can produce more vessels—quantity can have its own strategic impact.
  • Oceans remain critical to global trade; “shipping is the lifeblood of the world’s commerce.” (Dr. Smith, 16:27)

• Importance of Allies and Naval Coalitions

  • Allies such as Japan, India, Australia are significant, with India seen as a major player not fully aligned with either the U.S. or China.
  • NATO, though sometimes controversial, plays a vital role in sustaining global maritime freedom.

Notable Quotes & Moments

• “Western navies had swagger back then... That swagger is kind of important.” (Dr. Smith, 07:25)
• “Whoever is controlling the world’s ocean, you want them to have as broad a view of that commerce as possible. Totalitarian regimes just can’t do that. It’s not in their nature to want the freedom of the seas for free exchange…” (Dr. Smith, 17:27)

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Segment 2: The Real Legacy of Jimmy Carter

Guest: Stephen Hayward
Timestamps: 22:12–43:27

The Big Picture: Carter’s Presidency in Retrospect

• Carter’s astonishing rise from obscurity: “He came from 0% an asterisk in the polls at the beginning of the 76 cycle to being inaugurated as the 39th president in 18 months… but all the genius deserted him after he was elected.” (Hayward, 22:43)
• Carter’s presidency signifies the end of classical liberal economics, with stagflation marking a notable failure of Keynesian policy.

Stagflation and Economic Malaise

• Economic Hardships

  • Americans experienced high unemployment and inflation simultaneously—previously thought impossible under prevailing economic theory.
  • Gasoline shortages and rationing led to long lines and limited supply, while inflation became a weekly, visible phenomenon.
  • “You would sometimes have three or four stickers piled on top of one another with a higher price for something that had only been on the shelf for maybe a month or less.” (Hayward, 25:10)

• Origins and Policy Failures

  • While some economic woes began under Nixon, Carter is seen as having worsened them through incorrect diagnoses (“a moral failing of Americans”) and an over-reliance on government intervention.

Deregulation and Contradictions

• Despite liberal bona fides, Carter presided over major moves to deregulate transportation (trucking, airlines) and even took steps that led to the craft beer boom.
• “The principal legislation to decontrol trucking was worked out by Ted Kennedy… staff person who did all the analytical work… Stephen Breyer.” (Hayward, 29:18)
• Attempts at energy deregulation were muddied by fears of corporate profit (“let’s have a windfall profits tax”) and half-measures. True decontrol came only under Reagan.

The Malaise Speech and the Crisis of Confidence

• Carter’s famous “malaise speech” never actually used the word "malaise," but the label stuck. Americans, expecting policy solutions to gas lines and inflation, received a meditation on national soul-searching instead.
• “He spent most of the speech talking about a crisis of confidence in the American soul.” (Hayward, 33:14)
• The speech fell flat, reflecting Carter’s lack of actionable solutions and a growing disconnect from public expectations.

Carter’s Post-Presidency: A Mixed Legacy

• Widely lauded for humanitarian work (Habitat for Humanity, disease eradication), yet often criticized for freelance foreign policy interventions that undermined sitting presidents.
• "He was constantly undercutting President Reagan in the Middle east and elsewhere… Carter was actively calling around to leaders in the Middle east saying you should not cooperate with President George H.W. Bush’s coalition [in 1991]." (Hayward, 38:10)

Contrasting Carter and Reagan

• Reagan’s optimistic, empowering rhetoric and prompt, clear actions contrasted sharply with Carter’s handwringing and slow pivots.
• “A speech like that is really expressing the defects of our leader and not of the American people.” (Hayward, 40:01)
• Carter’s term catalyzed the Democratic Party’s transition, with growing tensions between liberal and conservative wings and a legacy echoed in later presidencies.

The Long-Term Democratic Party Legacy

• Carter’s transitional status between the old and new Democratic Parties paved the way for future progressives—Clinton, Kerry, Obama, and Biden.
• “Carter, he kind of sold out partly to the left. I mean, he appointed a lot of very left wing people that caused him problems… He was the transitional figure trying to hold the party together at a time the Democratic Party did not want to be held together." (Hayward, 41:03)

Notable Quotes & Memorable Moments

• “This was the closest America ever came to picking a name out of the phone book and making him president.” (Hayward, 22:43)
• “You know, the verdict of the 1972 election... was that government is best, which McGoverns least.” (Hayward, 41:03)
• “The most significant achievement of Ronald Reagan was proving that the presidency was not an obsolete institution and that in fact a person could govern effectively…” (Hayward, 37:42)

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Timestamps of Key Segments

• Opening and Navy Segment: 01:05–19:18
• Jimmy Carter’s Legacy (main interview): 22:12–43:27
  • Economic Malaise and Stagflation: 22:43–28:00
  • Deregulation Debates: 28:14–32:28
  • The “Malaise” Speech and National Mood: 33:14–34:42
  • Comparing Carter and Reagan: 40:01–40:47
  • Democratic Party Legacy: 41:03–43:02

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Conclusion

This episode provides a thorough review of Jimmy Carter’s presidency, reflecting on his rise, his struggles with stagflation and energy crises, ambitious-yet-contradictory deregulation moves, the famous “malaise” speech, and the lasting effects on the Democratic Party and American presidential politics. Peppered with vivid anecdotes, frank appraisals, and bite-sized history lessons, it strikes a tone both analytical and engaging for listeners seeking to understand why the Carter era still animates debate about American leadership and party identity.

Notable final quote:
“A speech like that is really expressing the defects of our leader and not of the American people.”
— Stephen Hayward (40:01)

Transcript

[A]

From the historic campus of Hillsdale College in Hillsdale, Michigan, where the good, the true and the beautiful are taught, nurtured and honored, this is the Radio Free Hillsdale Hour, bringing the activity and education of the college to listeners across the country.

[B]

He came from 0% * in the polls at the beginning of the 76th cycle to being inaugurated as the 39th president in 18 months. Politically, it was a work of genius, but all the genius deserted him after he was.

[A]

Elected. This is your host, Scott Bertram. Welcome to the Radio Free Hillsdale Hour, part of the Hillsdale College Podcast Network. That was Stephen Hayward, professor at Pepperdine, senior fellow at the Pacific Research Institute, and author of the Real Jimmy Carter. Later on in today's program, we talk in depth with Stephen about the Carter legacy. First, we're joined by Dr. Miles Smith, Assistant professor of history here at Hillsdale College. Dr. Smith, thanks for joining.

[C]

Us. Thanks for letting me be on.

[A]

Scott. Talking today about an essay you had published over at Real Clear Defense. Navy has a cultural crisis. And you open by saying that the US Navy is adrift strategically, culturally and spiritually. So what the heck's gone wrong over.

[C]

There? Well, I think that militaries need an identity. I'm writing a lot on the military right now. We started a military history center here at the college. So if our listeners don't know, that's really cool. Come out and participate in some of the events. So I think that what's happened is the Navy for a long time kind of understood itself as this kind of defender of a Western liberal democratic republic that was largely predicated on Judeo Christian values. And that sounds like something you would take for granted. But, but I don't think that that's necessarily been what the Navy, not just the Navy, but the military, as I thought they were doing. And because of that, I think you've seen strategic ossification. We're not really sure what it's there for. Even an idea of the freedom of the seas, which comes from Great Britain, has kind of gotten lost. So what's the Navy for? Obviously, it's huge, it's expensive, it's powerful. And so, and Americans pay for all of those things. They pay for the hugeness and the, the powerfulness of the U.S. navy. So they might ask, okay, all, all I ever hear about is you guys are running into each other, right? There's a series of mishaps over the last couple years. Those seem to be dying down, thank goodness. And so I think there's, there's a, there's A sense where the Navy sort of needed to recapture what it was really about. And I think that's happened. By the way, the new cno, Admiral Caudle is I think by disposition a relatively conservative man. He's from near where I grew up. He has a strong southern accent. He was reared in a Southern Baptist church. So he's kind of one of these OG kind of American type guys who really believes in what you kind of think of the good old fashioned mom and pop style military establishment. And I think that's a good thing. And so I think in a lot of ways, even since I've written the article, important changes have been made. The military is meeting its recruiting goals, but I think there had to be some sort of shift away. I won't call it the Biden era military because it's bigger than the Biden era, but there had to be some.

[A]

Change. Looking at the importance of the Navy, do Americans got to take maritime dominance and in fact maritime peace for granted? What's at stake when we talk about.

[C]

This? Yeah, we definitely take it for granted. The US Navy is the single most powerful maritime force that's ever existed. Each of our carrier groups is the size of a medium European Navy. And so we have hopefully we have the capability for to put 12 of them to sea. Usually there's only about six or seven of them at sea at any one time. Right now it's more like four. And so our navy is really powerful. But I think what we do is we take for granted that superiority you have to maintain that naval thinkers throughout history understand it's something you have to choose. We kind of get a little bit, we sit back, rest on our laurels and forget that a country like China wants to challenge us. And so if anything, it's a little bit like the end of the 19th century where Britain had this massive navy and Germany decided to challenge it. Now they can never get quite parody, but they put up a pretty good fight. And so I think the United States is clear thinking we don't want that to even get to where Germany was in 1914 challenging Britain. We would much rather have a navy that can overpower pretty much any and all comers. In the 19th century, that meant the US shooting the British Navy wanted to be twice as big as the two biggest navies after.

[A]

It. You quote a warning here in the piece at Real Clear Defense that Navy leadership is sleepwalking into defeat. What's wrong with the way that senior leaders are, are being chosen or thinking about their.

[C]

Jobs? I think some of It's a philosophy of history. Questions. When was the last time there were major naval battles? Probably in World War II. Right. So there just hasn't been anything. It's been 80 years. Right. It's been a healthy human lifetime since there's been significant ship to ship combat. There's broad belief amongst late 20th century Naval thinkers that aircraft carriers have fundamentally reshaped navies, that we don't need raw tonnage. There's a lot of people who in the past five years have said, no, that's wrong. Just raw tonnage does matter. China is building more. Raw tonnage has a capability of outweighing the U.S. navy considerably. We've. I think there's only about 87. I think since 1980, 87% of our shipbuilding capacity is gone. So this is something that you probably need to take seriously if you're an American, that if you want China to control the world's oceans, we should keep doing what they're doing. I don't want that. I don't think that the President of the United States want that. I don't think the American high command wants that. And so hopefully policymakers will make changes in order to keep that from being the.

[A]

Case. You write here that there's a spiritual problem inside the Navy as well, not just a strategic problem. What do you mean by that? And how does that manifest itself inside the.

[C]

Institution? Yeah, I think that the United States Navy is the United States Navy. It's not just merely some sort of, sort of gnostic bureaucracy that gets put on top of ships. Right. There's culture that comes with it, there's beliefs that come with it. In the end of the 19th century, there was this kind of assumption that, hey, we Westerners actually are superior and we need to act like that. And that's kind of a dirty thing to say. Now, luckily, I work for Hillsdale College, so I don't think Dr. Arne's going to fire me for saying that the Western political and intellectual and spiritual tradition is the superior one. But even military thinkers thought that. And so it wasn't to exclude people who weren't Westerners, it was to invite them in. And so Western navies and Western militaries kind of presented themselves to East Asian countries at the time as models to be emulated, not enemies to fight against. And so it kind of.

[B]

Works.

[C]

Right. The Japan, Korea, China, much later start to actually ape Western military norms. And for the most part, it's good for those countries. In the case of Japan, you might say it's too good Right. They begin to really act. They want to be like Germany and Britain. And so nonetheless, like, there's a reason for that sort of superior edge. It's almost like navies had swagger. Western navies had swagger back then. And that swagger is kind of important. It's not very popular to talk about that kind of era superiority, but it's important. It's important for the US Navy to have that over and against, especially the communist Chinese military, which they don't even call it the Navy, by the way. It's the People's Liberation, People's Liberation Army.

[A]

Navy. Dr. Miles Smith with us, Assistant professor of history here at Hillsdale. His piece at Real Clear Defense on the Navy, you draw on Alfred thayer Mahan, a 19th century naval strategist still influencing thinking today. What lessons from him do we.

[C]

Need to relearn that sea power is actually what controls the world? His famous book is called the the Influence of Sea Power on World History, 1662-1789. And so you have a real sense of controlling the world's seas is how a given country kind of controls its own fate. Whoever is able to control the seas basically controls the.

[A]

World.

[C]

Now. This is different than some of the military theories that kind of have anybody who controls the Eurasian land mass actually controls history or something like that. Mahan thought that if you had a big navy, you were going to run the show. And he goes through world powers like Britain and the Dutch, for example. Holland's this tiny little country, and yet it has outsized influence in the.

[A]

World.

[C]

Why? Because it has a huge navy. Same thing with Britain. Britain even in some ways exponentially more powerful than the Dutch ever were. But Great Britain's not that big. The whole island's smaller than Colorado, and it commanded a fourth of the world's land surface by the. By by 1900. So you get the feeling that navies actually matter. And Mahan realizes this. For the United States, we had kind of settled into being okay with being this continental power. And Mahan says, no, that's not good enough, because believe it or not, we can't control our continent unless we can control the oceans around.

[A]

It. Dr. Miles Smith with us. His recent essay at Real Clear Defense on the US Navy's cultural crisis will return him in a moment. But first, an opportunity to start the year on the right foot and learn something about classical music and do it in a fun way. The Hillsdale College online course, the history of Classical Chopin through Gershwin, is available now. Hillsdale. Edu new course. Your teacher is Hyperion Knight, a distinguished fellow here at Hillsdale College and also a fantastic concert pianist. Classical music is beautiful, and Hyperion Night is the person who can open the door to your enjoyment of classical music. Whether you're a novice or even an expert, it's a joy to hear him talk about the great composers who have shaped this music and also play the music right alongside those stories. This is part two, but don't worry if you haven't taken part one, you. You can still start with this second section, the History of Classical Music. Part two can be found now at Hillsdale. Edu Newcourse Hillsdale. Edu New Course we continue with Dr. Myles Smith from Hillsdale College. His essay at realcleardefense.com, uS Navy's Cultural Crisis. Mahan linked strategy to a sense of Western and Christian moral confidence as a more secular, more pluralistic America. Now, can we still have that kind of moral grounding in our strategic.

[C]

Outlook? Yeah, I think secularism at its best is actually an outgrowth of Christianity. Right. Secularism is really just a statement that churches don't need to control everything. Of course, you can have Judeo Christian Western values without them sort of being perpetuated by a specific church. And so I think at its best, of course, we don't need kind of theocracy or anything to perpetuate the superiority of the west or to sort of maintain Western superiority. We just have to believe in that tradition. I think that it's something as simple as I don't need every sailor to go to church. You know, guys, go have fun, play video games, get all your tattoos, go to B dubs on the weekend. You know, that's. We don't. No one wants to make these guys, you know, church boys or choir boys, but at the same time, they should kind of know the world they're fighting for. Like, what type of freedoms, what type of liberties, what type of place you want to be able to come back to. And so it's just as simple as that. Like, I want guys to be able to know that, hey, you know how it's cool to go buy whatever video games we want or go out to eat. All those little things are actually downstream from Judeo Christian values because Chinese people can't do all those things. Things and people in total, totalitarian countries can't do all those.

[A]

Things. Talking with Dr. Miles Smith, his piece at Real Clear Defense on the Navy and its cultural crisis. You say that logistics is the key to victory in the Pacific. What's our biggest shortfall in that department. And what would it take to fix it before a potential real crisis with.

[C]

China? The Sealif Command, it's not as big per capita as it once was. I lived in Norfolk, Virginia for a long time and so you can see all the ships coming in and out. U.S. navy's aging. We don't build as many ships as we used to. It takes us a long time to refit a ship. And so some of it is is just the raw numbers of holes we put together. Takes us a long time to do that compared to, for example, the prc, which does it fairly quickly. Doesn't mean they're putting together good ships, but it does mean at some point, three or four bad ships can actually put a dent in a military situation. And so I think that that's something significant to think about. Our ability to get the stuff we need to as fast as possible, as efficiently as possible in craft that are seaworthy and superior is something to think about. And like I said, I think those things are being addressed slowly but surely. It'll take us a couple of years to actually see what happens on the.

[A]

Ground. We can see by actions that clearly China wants to establish itself or elevate itself as a naval power. How do you assess that challenge posed by China's Navy presently? Are they already ahead of us in areas that we should be concerned.

[C]

About? No, but we should want to keep it that way. I think that there's a lot of, especially on the right, there's a lot of sort of, you know, hand wringing about China's superiority. China's not superior to us. Their aircraft carriers are basically what we would think of as 1970s technology. We're way ahead of them, but we should really fight to stay ahead of them. And I think that that's what is kind of concerning. Do we have the willpower to maintain our superiority over a country like the prc? Do we have the willpower to push them around a little bit? Interestingly enough, Argentina seems to be willing to do this. Argentina regularly is sort of pushing out at least small Chinese support craft from Argentine waters. It'd be interesting to see what other countries are willing to do.

[A]

That. We talk a lot about the US and China, obviously. Who are the other naval powers we should know about around the.

[C]

World? Japan is probably one that is going to start not saber rattling in a nefarious sense, but it's going to make sure, especially with the new Prime Minister coming in. She's very much a China hawk. She wants to re establish Japan's naval superiority in the Sea of Japan and in Japan's kind of broader sphere of influence, other players in the region, Australia, Malaysia, Thailand. But probably for our purposes, the single most important one is one that doesn't even really have a stake in this India big giant navy, a well trained navy, a professional Western style navy, but one that isn't reflexively in either the camp of the United States or.

[A]

China. So why are the oceans of such vital importance to the peace and prosperity of both the US and the global community? Why should we be so concerned about.

[C]

This? Well, because, I mean, shipping is, is the lifeblood of the world's commerce. Obviously we have airplanes. Airplanes are great. But if you've ever lived near a big ship and lived near a big airplane, you know that ships are a lot bigger than airplanes. One of my favorite things to do is when I lived in Norfolk, if people just go over the battleship, the USS Wisconsin, it's huge, it's 900ft long on just under 900ft long, you know, it's 150ft wide, and you're going, good grief, this is huge. And I'll imagine freight ships that are even bigger than that. A battleship, a World War II battleships, nowhere near as big as modern freighters are. So we can just ship a lot of stuff. And actually you can move over water fairly efficiently too. And so I think that oceans are still kind of the lifeblood of the world commerce. We ship cars. There's things you can't ship in airplanes. And so cars, big containers, stuff like that, all of that stuff needs maritime commerce. And so whoever is controlling the world's ocean, you want them to have as broad a view of that commerce as possible. Totalitarian regimes just can't do that. It's not in their nature to want the freedom of the seas for free exchange of goods. And so that's why I think the United States should be the country that controls the world's.

[A]

Oceans. Are we a little more cognizant of that based on what we've seen in the Middle east shipping channels there, problems of the past 12, 18.

[C]

Months? Yeah, the Houthis in Yemen closing down the southern interchange points in the Red Sea. You don't want a powerless United States Navy because you want to be able to remove rogue players who would shut down the world's major shipping points. The Sunda Strait is another one you can think about. You want obviously NATO controlling the North Sea, NATO controlling the areas in and around Iceland. So I think that this is why NATO is controversial today. I think a lot of Americans are like, well, why do we have it? Europe's so weird, right? And I get that. I totally agree. But one thing that's useful about NATO is that it's more than just a bunch of land units facing Russia. Right. It's also major Western navies who, for all of their government's problems, all seem to be invested in maintaining the freedom of the seas. That's a good thing. You want those 27, 28 navies all doing that. So as goofy as their countries may be, whatever people might think about the Russia, Ukraine conflict, you really want these big Western navies maintaining the freedom of the.

[A]

Seas. Dr. Miles Smith, assistant professor of history here at Hillsdale College. You can find his piece about the Navy's cultural crisis over at real clear defense. Dr. Smith, thanks so much for joining us here on Bo Radio Free Hillsdale.

[C]

Hour. Thanks.

[A]

Scott. Up next, Stephen Hayward joins us. He wrote the book the Real Jimmy Carter, and we discuss Carter's legacy specifically on the economic side of things. I'm Scott Bertram. This this is the Radio Free Hillsdale Hour. Classical music is one of the.

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Network. Great books, great people, great ideas. Learning about these things is critical to being a well educated human being. And we can help with the Hillsdale Dialogues. Each week, Hillsdale College President Larry Arne joins radio veteran Hugh Hewitt to discuss topics of enduring relevance. And from time to time, they also talk about current events, but always with an eye toward more fundamental truths. And they want you to tune in to a conversation like no other. The Hillsdale Dialogues are posted every Monday on the Hillsdale College Podcast Network at podcast hills hillsdale.edu. that's podcast hillsdale Edu. Or listen via Apple Podcasts, Spotify, YouTube or wherever you find your audio. Welcome back to the Radio Free Hillsdale Hour. I'm Scott Bertram. Be sure to check out the Hillsdale College Podcast Network. Do it at podcast hillsdale.edu. you can find all of our shows wherever you find your audio, including at YouTube. We're joined by Stephen F. Hayward. He's professor of Public Policy at Pepperdine University, senior fellow at Pacific Research Institute, and the author of the book the Real Jimmy How Our Worst Ex President Undermines American Foreign Policy, Coddles Dictators and Created the Party of Clinton and Kerry. Stephen, thanks so much for joining.

[B]

Us. Well, thank you for having me.

[A]

Scott. People might pick up on the title of the book. It was written about 20 years ago. You're here on Hillsdale's campus now as part of our CCA lecture series and delivering a lecture on the Carter economy, essentially. And today we'll talk about deregulation, stagflation, malaise and all things Jimmy Carter. The big picture, though, when we talk about the Carter years and the Carter presidency, what comes to your mind? First, if someone didn't live through the Carter years, how would you describe that.

[B]

Era? Yeah, well, it's nearly 50 years ago now, since he was first elected. And it's really quite amazing that this, there was one historian who said this was the closest America ever came to picking a name out of the phone book and making him president. I mean, no one had heard of this guy. He came from 0% an asterisk in the polls at the beginning of the 76 cycle to being inaugurated as the 39th president in 18 months politically. And this is just a phenomenon of running for president. It was a work of genius, but all the genius deserted him after he was elected. And so I think what most people remember who were alive then was that's when stagflation got out of control. And it was kind of the end of the road for liberal economics. We had both high inflation and high unemployment at the same time, which classical Keynesian theory said you couldn't have and could be easily fixed by turning the knobs of the fine tuning instruments. And then we had the second inning, I like to say, of the energy crisis. There was no energy crisis. It was a government policy crisis. But Carter took a bad situation and made it all.

[A]

Worse. For average everyday Americans in the late 1970s, what was life like for them dealing with gas lines and dealing with things that had not previously dealt with in.

[B]

Decades? Right. Well, there are two things really stick out from people from the time. And I tell students about it sometimes and they find it hard to believe. But yeah, we had to line up for gasoline in the summer of 1979, four or five in the morning, and that's because the gas stations would stop selling gas by about 10 in the morning and they limited you to 10 gallons in most cases. In other words, we had gasoline rationing just by making you wait in line instead of by price or coupons or something. And this was all madness. It takes a long time to unravel. But the other thing was inflation. Everyone nowadays is used to either shopping online or with barcodes. But in late 70s at the grocery stores, you still had stickers on peanut butter jars and all the items. And that was a big job then for teenage kid, was the stock boy would go around and put the stickers on all the, every single jar, every single box of cereal. And my mother, who did the shopping in my house would come home and she would start peeling off the stickers. In other words, you would sometimes have three or four stickers piled on top of one another with a higher price for something that had only been on the shelf for maybe a month or less. You know, peanut butter and jelly and things of that kind. That really brought it home to people when you could see prices rising almost in real time in your week to week grocery.

[A]

Shopping. We did have something similar during the Biden inflation era at restaurants, specifically go to a restaurant, look at the menu. Instead of putting up new menus every two weeks, sticker, sticker, sticker. As prices increase on everything across the.

[B]

Board. Yeah. When inflation first started taking off to 8, 9% in 1978, Jimmy Carter said, well, this is just a temporary aberration. And then we saw the echo in the Biden years. It was transitory inflation. And nobody believed it then and nobody believed it.

[A]

Now. Talking with Steven Hayward here on Hillsdale's campus about Jimmy Carter and the Carter economy. Stagflation, high inflation, high unemployment, together. You mentioned it wasn't supposed to be possible. So why was it possible? How did it happen? And why was it hard to fix? Oh.

[B]

Right. That's a really important story. One of the reasons that happened. Well, high monetary growth is what leads to inflation. I mean, Milton Friedman won his Nobel Prize, I think it was 1970, and his theories weren't at that time widely accepted. They're still controversial today with some people on the left. But monetary growth had just run out of control in the Carter years. It was over 10% a year in basic monetary growth. And that's too high. And Carter finally figured that out by 1979. I mean, Friedman, other monetarists, their ideas caught on by 1979. And that's when Carter reversed course, appointed Paul Volcker as chair of the Federal Reserve and began the long because it is Always long and painful process of bringing inflation down. But the other reason you had the swoon in employment and job creation was because taxes were too high, especially in an era of inflation. So it was in the middle of Carter's term that you had the beginning of supply side economics. It was the Kemp Roth tax cut, which Carter vigorously opposed. Said it was a giveaway. All the cliches we hear now give away to the rich tax cut for millionaires and so forth. And you know, today we're so used to venture capital and startups out of Silicon Valley and elsewhere, and there was almost none of that happening. And so the tax cut passed Congress by large bipartisan majorities, even liberals, some could see the logic of you can't have 50% taxes on capital gains. One of the persons who voted for that tax cut in the Senate was a first term senator from Delaware named Joe Biden. Even he could figure it out back then. And lo and behold, in the first year after the tax cut passed in 1978, Carter relented on his threat to veto it because he was going to lose a veto override. Venture capital activity soared about 15 fold. Capital gains tax revenue went up, proving the famous Laffer curve that if you lower rates, especially on a discretionary thing like, you know, when you take capital gains, how you invest, it's productive for the economy. And of course that really was the spark that sets the boom of the 80s when you had huge job growth, huge startups and so.

[A]

Forth. We did have win buttons before Jimmy Carter with inflation. Now, so how much of this was due to Carter's specific policies? And were there some things that were already put in place when he took.

[B]

Office? Yeah, I mean, to be fair, Carter did inherit a bad economic situation from his Republican predecessors, but then he made everything worse. I mean, his theory of inflation, in addition to thinking this is just temporary, was, and this is kind of shocking to look back on now, but it represented a moral failing of Americans. It was because of our materialism. And they thought big spending, it won't really cause inflation. In other words, they didn't have a clear economic doctrine or to the extent they did, it was wrong. But yeah, I mean, inflation really gets started under Nixon and it goes down a little under four. Just there was a recession and so forth. So it was already baked in the cake. But then Carter put another layer on that cake is the way I put.

[A]

It. Stephen Hayward with us. As we talk about Jimmy Carter's economic legacy when it comes to deregulation, it might surprise people that this Liberal Democrat started the wave of deregulation. So why was he motivated to do so? I find it hard to believe it was because of his free market. What motivated Carter to go about this.

[B]

Deregulation? Well, it was a lot of people around him who figured out that we were over regulating or shouldn't be regulating at all certain basic industries, especially transportation and later a little bit energy a certain way. But transportation, airlines and deregulation. They said it's crazy to still be having the federal government setting trucking rates and airline airfares, which we were doing very aggressively. And it's a long story I love telling students about what really I think broke the dam was when Southwest Airlines was founded in Texas because it was intra state, just operating in Texas, they were immune from federal rate setting. So I think Southwest used to run introductory fares from Dallas to San Antonio for $12. I interviewed the president of it back then, Herb Kelleher, one of the founders. He said our competition wasn't the other airlines, it was Greyhound. And people looked up and said, well wait a minute. And then you had other competitive airlines joined in in California, had Pacific, Southwest Airlines just operating LA into San Francisco, very cheap fares. And so someone said, you know, why don't we let the marketplace set airfares? And also trucking is a more complicated and amusing story. And some of his own people and some Democrats, you know, the principal legislation to decontrol trucking was worked out by Ted Kennedy of all people, his staff person who did all the analytical work, a young Harvard law graduate named Stephen Breyer, who famous in song and story on the Supreme Court decades later. So even liberals could see that that old school regulation needed to go. On the other hand, during the 70s you had a huge upswing in social regulation. So while we were starting to back away from sort of New Deal style market regulation, we now had the epa, the Consumer Product Safety Commission. The Carter administration was all in on that. They thought about proposing a whole cabinet level Department of Consumer affairs which would have been a regulatory nadirite nightmare. But then there's something in between on not really social regulation, but Carter, who was a teetotaling Southern Baptist, decontrolled or deregulated beer brewing. Yes, and the whole brew pub explosion we've all enjoyed the last few decades. We can thank Jimmy Carter for that, believe it or.

[A]

Not. Why did he stop there? Or why did the administration stop there if they were seeing success in deregulation of certain.

[B]

Industries? Confusion, right. I mean there were a number of people who said, you know, the Energy market was heavily regulated, it still is in certain ways in electric utilities. But oil and gas were regulated, both prices, and we had these allocation quotas that were Byzantine. And Carter agreed in principle, yes, we ought to deregulate, but he was worried that, well, oil companies might make too much money. So he said, let's deregulate the price, but let's have a windfall profits tax. This made no sense at all. And so all their decontrol impulses were only half measures. It didn't really get changed until literally day one of the Reagan administration. One of the first things he did, first day in office, was completely decontrol the price of oil in the country. Liberals said gas is going to go to $2 a gallon. It was then about a dollar and a quarter. Instead, the price of gas immediately fell below a dollar and stayed there for most of the.

[A]

1980S. Talking with Steven Hayward, professor of public policy at Pepperdine, also senior fellow at the Pacific Research Institute Institute, his book is the Real Jimmy Carter. Here on Hillsdale's campus, giving a lecture on Jimmy Carter, Mostly on the economy here, but a little foreign policy as well. As we talk about the malaise speech and energy in the country. I was just telling my students about this. We're not familiar with the malaise speech at all. But the word malaise is never uttered by Jimmy Carter in the malaise speech. I believe it was confirmed by a spokesman after the fact said, could we call that the malaise speech? Yeah, I think you could. So it's now the malaise speech, but it's the crisis of confidence speech that Jimmy Carter gives. Why did that speech strike such a nerve? And did it reveal certain things about his.

[B]

Presidency? Right, yeah. So that speech was given in the middle of the summer of 1979, in the middle of the gasoline crisis. And everyone thought it was going to be a speech of what we're going to do about this crisis. And Carter, it's a strange story. He disappeared for about two weeks to Camp David before the speech. He canceled the first scheduled date for it. And then when he came back, Americans tuned in in large numbers. What are we going to do about these gas lines and all the other things that go along with it? Inflation. Instead, he spent most of the speech talking about a crisis of confidence in the American soul. And one of the things that struck you so odd about this was a year before, Alexander Solzhenitsyn had given his famous Harvard commencement address where he said similar things about too much materialism in America, a loss of belief and the Carter administration vigorously criticized that speech, and now they were saying something very similar to it. And, yeah, it turned out that the story about the speech is kind of Byzantine also. But he was much taken with the sociologist Christopher Lasch, an interesting theorist, and he'd used the word malaise to describe America in the 70s. I think there is a certain aspect in which the speech really does capture the mood of the 70s in some ways, but coming from a president from whom he wanted action steps, it landed with a thud. And, yeah, so it's now malaise forever. I do tell students, in the words, famous words of Yogi Berra, you have to see it not to believe it. People should watch it on YouTube. And I've shown it to students today, and usually their jaws.

[A]

Drop. This crisis of confidence that Carter talks about gas lines, and you have New York City in the late 70s, which is a total mess, a complete disaster. And you look overseas, the Iran hostage crisis is playing out at this point, the Soviet invasion of Afghanistan. There's a sense of just pessimism, whether it be domestic or foreign, among Americans from coast to coast. How does all that come together to create the sense of this.

[B]

Crisis? Yeah, so, I mean, I guess the. The one sentence summary of the Malay speech which connects to foreign policy is, remember that Carter ran for President in 1976 on the slogan a government is good as the people. And in that speech, in the summer of 79, he was essentially saying, the people are no good. And so that wasn't lost on people overseas. He came to office saying, we need to get over our inordinate fear of Communism. And he was all for detente, he was all for arms control. And then suddenly, the Soviet Union is getting very frisky. They invade Afghanistan, and then suddenly Carter says, oh, wait a minute, these people are bad. He reversed course and announced the Carter doctrine that any Soviet move in the Middle east will be an attack on a military America, increase the defense budget. So it showed that, like regulation, he was capable of learning just very.

[A]

Slowly. I was telling students as we talked about this crisis of confidence speech that there was a sense among some pundits, analysts, that the presidency was becoming far too big for one person. We can't look at Carter. Carter's a governor, Southern governor. We all liked him. We voted for even. He can't handle all the. All the other duties of the presidency. We need two presidents. I mean, certainly you'd need to have a constitutional amendment, all these. But how serious was this conversation saying, we need change, we need more than one person to run this.

[B]

Country. Well, there are a variety of reform ideas, but that was a very serious conversation. You can go back and look at the literature in leading academic journals, Time magazine, things of that kind, elite media. And they all said, and take the long story, Ark, they said, we now have four failed presidencies in a row. You know, Johnson ends in disaster with Vietnam and the Great Society. Nixon gives us Watergate. Ford was a placeholder but wasn't reelected. And then Carter, we thought this smart person trained in engineering can't cope with this and the presidency is too big. And so, yeah, have more than one president, have members of Congress be cabinet members, like in a parliamentary system, have a single six year term. That was a popular idea. All these would have required or most of them a constitutional amendment. And that is in fact, I always say the most significant achievement of Ronald Reagan was proving that the presidency was not an obsolete institution and that in fact a person could govern effectively and maintain the support of the American people. And I think almost all of Reagan's successors have demonstrated that. We've had several two term presidents since then. You know, the ups and downs and the usual controversies, but they did manage to govern.

[A]

Effectively. Stephen Hayward with us. His book the Real Jimmy How Our Worst Ex President Undermines American Foreign Policy, Coddles Dictators and Created the Party of Clinton and Kerry. As I mentioned, the book was about 20 years old, but the sentiment remains, especially around Jimmy Carter's passing. We heard a lot of people say, you know, he might not have been the best president we ever had, but as an ex president he was outstanding, he was great post presidency. Why are they.

[B]

Wrong? Yes, well, there's two or three reasons. One is, of course he helped build up Habitat for Humanity. He didn't found that, but he lent his celebrity to it and built it up. And that's a good thing. He led a crusade in the developing world to eliminate guinea worm disease, which is a terrible disease. Props to him for that. But as an ex president, he was constantly meddling in foreign policy. You know, he had his Carter center in Atlanta and he was sort of running his own private State Department. He'd have Soviet officials down to meet and talk about arms control. He was constantly undercutting President Reagan in the Middle east and elsewhere. And the ultimate interference came in the first Gulf War in 1991. Carter was actively calling around to leaders in the Middle east saying, you should not cooperate with President George H.W. bush's coalition to oust Saddam Hussein from Kuwait. The Bush administration learned of this from diplomats in the Middle east and were shocked that an exist president would so actively insert himself into a world crisis of this kind. I mean any, of course president's not a normal private citizen, but still any private citizen who did that, say Bill Gates or Elon Musk or somebody, would risk prosecution under the Logan Act, a little enforced act from the beginning of the republic. So he did a lot of things like that that call into question his judgment, his self regard and several other less appealing traits of his.

[A]

Character. Following Jimmy Carter's presidency, Ronald Reagan takes office for two terms. And after the first two years, when there's some fits and starts as policies begin to take effect, really turns the country around both in terms of literal economic performance, but also there's no more crisis of confidence. How would you contrast how Carter attempted to deal with America's problems with how Reagan actually dealt with, with America's problems? What can we say about the two styles of.

[B]

Leadership? Right, yeah. So you know, Reagan reacted very harshly to the Malay speech when it was given. And I think he put his finger on it. He said something along the lines of, you know, a speech like that is really expressing the defects of our leader and not of the American people. And Reagan's disposition, starting with his, I think fabulous first inaugural address, was you. The people are where the solution to the country's problems lie and you're great people and, and you've always been capable of great things. We're going to get off your back and help you when we can, get out of the way when we can't. And remember Reagan's reelection campaign in 1984. The slogan was it's morning in America. I think there's some reasons to criticize that in some ways, but in other ways it did capture the rapidly turning mood of the country. We forgot about the dreariness of the 70s really.

[A]

Fast. The book again talks about how Carter helped create the party of Clinton and Kerry. We're past that a little bit at this point. How would you describe or what would be Carter's now really long term effect on the shape of the Democratic.

[B]

Party? Well, he was a transitional figure, I put it that way, between the old Democratic Party, which still existed in the 70s, and today's. I say new Democratic Party, which is pretty far to the progressive left. And Carter had some conservative instincts or inclinations that were kind of fuzzy at times. But I'd like to say that, you know, the verdict of the 1972 election, to borrow my old mentor Stan Evans line, was that government is best, which McGoverns least one of his great witticisms. And the problem was is that McGovern captured the heart and soul of the Democratic Party, just not the voters. Carter understood that he barely won in 76 after all the scandals with Republicans. He barely eked into office which showed the country was trending to the right, I think. And what happened was, is that Carter was a disaster for Democrats, as we know. And ever since then, all the Democrats have either been from the aggressive left like Obama, or they have concealed their leftism. That would have been Clinton. Kerry, of course, lost and certainly Joe Biden, who as I've said was a moderate to conservative Democrat in the 70s and as president sold out completely to the progressive left of his party. Where are we today? Well, you know, right now as we're talking, the polls show the Democratic Party at its lowest level of respect by Americans ever. And you have an effort to try and bring the Democratic Party back to the center. We'll see how that goes. But Carter, he kind of sold out partly to the left. I mean, he appointed a lot of very left wing people that caused him problems. Andrew Young as UN Ambassador, other names that are now completely forgotten that I will forget, will not mention now. But he was the transitional figure trying to hold the party together at a time the Democratic Party did not want to be held together. Remember last fact, Carter had huge majorities in the House and Senate, 62 Democratic senators. So it was filibuster proof. He could hardly pass anything through Congress. And the Congress was always bitterly divided about things in his own.

[A]

Party. Stephen Hayward, he is a professor of public policy at Pepperdine, also senior fellow at the Pacific Research Institute Institute. His book, the Real Jimmy Carter, here on Hillsdale's campus giving a lecture as part of our CCA lecture series. You can find that full lecture @freedomlibrary hillsdale.edu. stephen, thanks so much for joining us here on the Radio Free Hillsdale.

[B]

Hour. Well, thank you, Scott. I enjoy listening in to you guys now and.

[A]

Then. That will wrap up this edition of the Radio Free Hillsdale Hour. Our thanks to Dr. Miles Smith from Hillsdale College and Steven Hayward from Pepperdine and the Pacific Research Institute. Remember, you can hear new episodes every week on this station. You also can find extended versions of some of our interviews or listen anytime to the podcast. Find it at podcast hillsdale.edu or wherever you get your audio. Until next week, I'm Scott Bertram and this has been the Radio Free Hillsdale.