18
MICHAEL HARRINGTON
end the Korean War, refuse the Nixon-Radford proposal of nuclear
intervention in Indochina, invite Khrushchev to the United States, etc.
And John F. Kennedy was able to persuade the Senate to agree to the
nuclear test-ban treaty. In each of these instances, I submit, another
man could have acted differently and with momentous consequences.
In saying this, I do not pretend to great optimism. My analysis sug–
gests that it is difficult, if not impossible, to mobilize domestically in order
to change a President's mind on how he should act internationally. Yet,
I am convinced that Lyndon Johnson
could
end our tragic commitment
in Vietnam if he wanted to. He is not the victim of his fate, or of History,
but, in this instance, of his own judgment and temperament.
2. The problem of inflation was created by federal policy to a large
extent and the way in which this was done makes it unlikely that the
crisis will be resolved in a progressive fashion . The poor, as usual, will
lose.
In 1961 when President Kennedy sought to get the economy mov–
ing again, he was persuaded by the "moderates" within his Administra–
tion (Walter Heller, Paul Samuelson) to take the route of fiscal stimula–
tion through tax cuts. He turned down his more liberal advisers (Gal–
braith, trade-union economists) who argued for direct social investments
in housing, schools, hospitals and the like. This decision gave the Ken–
nedy boom its peculiar quality. Roughly twenty billion dollars a year in
various types of tax cuts were distributed and, given the income structure
of America, the overwhelming bulk of these funds went to the rich (both
individuals and corporations). In addition, a handsome investment tax
credit and a new method of computing depreciation powered a lopsided
surge in capital goods production. In this setting, big business increased
its profits at a rate more than double that of wages. So instead of a
vast expansion, from the bottom up, of the social consumption of the
people there was this top-down stimulation of the economy through
profits, capital goods and private consumption.
When, however, the war in Vietnam began to escalate, the Admin–
istration faced a problem. It had made a modicum of economic progress
by helping the rich to get richer. Could it now completely reverse direc–
tion and demand "equality of sacrifice" from those very corporations
which it had so generously encouraged to profiteer? The answer, in
Lyndon
B.
Johnson'S Washington, was obvious. So inflation was com–
batted in the same way that prosperity was promoted: by securing the
interests of the best-off. As a result, it suddenly turned out that 4 per
cent unemployment was as far as we could go, social spending was cut
back and some hundreds of thousands at the bottom of the heap were
declared to be unemployable.
