The following interesting post appeared (December 31, 2006) in Brad DeLong's influential Semi-Daily Journal
blog and in Econbrowser
by James Hamilton and Menzie Chin (posted by James Hamilton on December 29, 2006). The quotation from the ITEM
was subsequently repeated and characterized as a "smoking gun" in Kling and Caplan's EconLog
on January 9, 2007:
- "When Nixon himself became president in 1968 and had the opportunity to appoint a new Chair for the Federal Reserve in 1970, the man he turned to was the same Arthur Burns who had advised him to ease up on monetary policy prior to the 1960 election. Milton Friedman offered these impressions in a 2000 interview that is included in the book Inside the Economist's Mind:
From the moment Burns got into the Fed, I think politics played a great role in what happened. So far as Nixon was concerned, there is no doubt, as I know from personal experience. I had a session with Nixon sometime in 1970-- I think it was 1970, might have been 1971-- in which he wanted me to urge Arthur to increase the money supply more rapidly [laughter] and I said to the President, 'Do you really want to do that? The only effect of that will be to leave you with a larger inflation if you do get reelected.' And he said, 'Well, we'll worry about that after we get reelected.' [page 116]."