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MARK AUSTIN THOMAS: The nation’s 38th President Gerald Ford died last night at his home in Rancho Mirage, California. He was 93 years old.
One of the significant accomplishments during his time in the White House was helping to institute the G7 summits, now known as the G8.
Robert Hormats is the vice chairman of Goldman Sachs.
Back in the mid-’70s he was a young economic adviser to President Ford and remembers the significance of those summits.
ROBERT HORMATS: That was very important, sort of bringing the U.S. into this cooperative network with the major European economies and with Japan and Canada. And I think we’ve seen the legacy of that today. There’s a lot closer global, financial and economic cooperation today because of that summit process and Ford didn’t initiate the first one, but he kept the process alive by hosting the second one in Puerto Rico. And it went on after that.
One of the economic challenges Ford faced while in the White House was a rising rate of inflation of around 7 percent a year.
Nixon had tried wage and price controls but that didn’t work. Ford didn’t favor government intervention and instead tried to encourage citizens to WIN or whip inflation now.
Bob Hormats admits that the WIN campaign wasn’t enough to get the job done.
HORMATS: It was basically a very naive policy when you think about it. Particularly when you think what was actually required to deal with inflation, as we found out later on. It was mostly a way of saying you’re addressing inflation, but not really doing the kinds of things you needed to do, particularly very tough measures, in the monetary area.
He says what really helped knock down inflation was double digit interest rates from the Federal Reserve.
Funeral arrangements will be announced today.
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