Gerald R. Ford: An Honorable Life

Chapter 18 - Challenges

304 Chapter 18 Challenges In the first hour of his Presidency, Gerald Ford had promised the American people straight talk and candor. Five months later, in his first State of the Union address, he kept that promise.“I’ve got bad news,” he said, his voice solemn but firm.“I must say to you that the State of the Union is not good. Millions of Americans are out of work. Recession and inflation are eroding the money of millions more. Prices are too high, and sales too low. This year’s Federal deficit will be about $30 billion; next year’s probably $45 billion. The national debt will rise to over $500 billion . Our plant capacity and production are not increasing fast enough. We depend on others for essential energy.” These were the facts, sobering and critical, Ford said, but it was a time for resolution, not despair. It was time, he said, for immediate action . For himself and for Congress the first priority: “Let us mobilize . . . to put all our people to work.” To spur industry and create jobs, Ford proposed to cut taxes for one year: For individuals, a cash rebate of 12 percent of 1974 payments; for business, large and small, a 12 percent investment tax credit. “Cutting taxes now is essential if we are to turn the economy around,” he said. “Unfortunately it will increase the size of the budget deficit.” That too must be addressed, he said. Confronting Congress head on, Ford told Members they must stop uncontrolled spending, stop enacting programs when “no one knows what they will cost.” As one strong move to curb the growth of Federal spending, he proposed to limit Social Security and Federal pension increases to 5 percent. Affirming his sweeping budget decisions of December, Ford told Congress his Administration would lead the way. For the Executive departments, Challenges 305 “No new spending programs can be initiated this year, except for energy . Further, I will not hesitate to veto any new spending programs adopted by Congress.” Ford’s immediate audience—­ Members of the House and Senate—­ sat on its collective hands as they listened to his grim appraisal of the economic crisis facing the country. Ford had expected little applause, but he was sure he had been right to deliver the bad news. In his judgment, it was his obligation to speak plainly about “what the facts are as to the economy and our situation.” It was Ford’s hope that Congress would share his concern and respond. He was mistaken. Ford’s call to action was disdained or ignored. House Ways and Means Committee Chairman Al Ullman responded that his Members would not even hold hearings on a corporate tax cut, or even consider a limit on Social Security and Federal pension increases. Economizing was not on the 94th Congress’ agenda. Liberal in philosophy, this Congress was even more liberal with public money. From freshman to veteran, Members were committed to creating new programs without regard to cost; to spending and more spending. Ford was learning, seeing the House and Senate from a new perspective, recognizing that he would have to defend the U.S. Treasury from the profligacy of his former colleagues. In the White House Ford was also learning to be an executive, and one measure of his progress was the quality of the new Cabinet he formed. Six months earlier he had insisted on keeping the Nixon Cabinet; now Ford realized that Rumsfeld was right. He must make changes, for the country would not fully recognize that this was a Ford Presidency until he formed a Ford Cabinet. Ford knew what he wanted. “I like to work with people who have a high degree of intellectual capacity and capability, and who are independent individuals in their own right,” he said. “I don’t pretend to be an intellectual. But in fact, I get strength from having those kinds of people around.” Since he had not campaigned for the office, he had no political obligation in appointing his Cabinet. Nevertheless, he respected political experience. “If I had two people of equal ability available for an important job, I would favor the one who had the experience of being elected to office.” Ford’s way of choosing his Cabinet exemplified his methodical approach to decisions: Evaluate each department’s need. Get the facts 306 gerald r. ford about possible choices, pro and con. Talk, face...