There is a need to set the record straight in response to Henry Olsen’s false assertion about inflation in his January 16 Patriot-News column. Olsen says that Ronald Reagan and “his” Federal Reserve Chairman Paul Volcker bravely risked a recession to stem inflation in the 1980s, setting us on the path to 40 years of price stability and economic growth. There are two major problems with this statement, whereby Olsen gives Reagan undue credit.
First, Olsen attempts to rewrite history. Volcker was appointed Federal President by President Jimmy Carter in 1979. Volcker made the first of a series of interest rate increases to fight inflation in October 1979, a year before Reagan was elected and 15 months before Reagan took office. He lowered them briefly in the mid-1980s, only to raise them again late that year, before Reagan took office.
Second, the Federal President, once appointed and confirmed by the Senate, acts independently. He does not coordinate policy with the president. It was candidate Carter Volcker’s monetary policy that defeated inflation in the early 1980s. Reagan had nothing to do with that. In fact, upon taking power, the Reagan administration tried to persuade Volcker to change course, fearing that high interest rates would cause a recession.
I know Olsen is an opinion columnist, but that shouldn’t allow him to blatantly misrepresent the facts.
Gary Tuma, Silver Spring Township, Pennsylvania.