Flexible Exchange Rates as a Vehicle for Nixon’s Re-election

Abstract

With a witch-hunting reputation to live down, Nixon’s chances of winning in 1968 were regarded as ‘dim’. Both Edward Kennedy and Hubert Humphrey were in favour of the draft and Nixon’s narrow victory has been partly attributed to Nixon’s conversion to Friedman’s long-held advocacy of an all-volunteer army. This was the marriage of ideas and vested interests, transmitted to Nixon via the head of his research department, Martin Anderson (Anderson 1993, 173–4; Friedman 1977, 12; Friedman and Friedman 1998, 377–81; Safire 1975, 77). Shortly after taking office, Nixon was again exposed to Friedman’s proposal to take the wind out of the anti-Vietnam war rhetoric by announcing a timetable for the phasing out of conscription. Defense Secretary Melvin Laird was an advocate of Friedman’s position. Nixon scribbled: ‘Get Laird’s comment on this intriguing proposal’ (cited by Reeves 2001, 51, 77).