Gerald Ford's presidency faced significant challenges following Nixon's resignation. He granted Nixon a full pardon, aiming to heal the nation but sparking controversy. This decision, along with ongoing Watergate fallout, hindered Ford's efforts to restore public trust in government.

Ford also grappled with severe economic stagflation, characterized by high inflation, slow growth, and unemployment. His response included the symbolic Whip Inflation Now program and tax measures, but these efforts had limited success in addressing the underlying economic issues.

Ford's Presidency: Pardoning Nixon

Reaction to Nixon's pardon

• Ford granted Nixon a full, unconditional pardon for any crimes committed during his presidency aimed at helping the country move forward and avoid a lengthy, divisive trial
• Political reaction was mixed with some Republicans supporting the decision as necessary for healing while many Democrats and some Republicans criticized it as a "corrupt bargain" and abuse of power
• Public reaction was largely negative with many Americans feeling Nixon should have been held accountable for his actions in the Watergate scandal leading to Ford's approval rating dropping from 71% to 50%
• The pardon had a lasting impact on Ford's presidency by contributing to public perception of him as weak and ineffective, undermining efforts to restore trust post-Watergate, and potentially contributing to his defeat in the 1976 presidential election against Carter

Restoring trust post-Watergate

• Ford faced the difficult task of restoring public trust in the presidency after Watergate severely damaged the credibility and legitimacy of the office leaving many Americans skeptical of government and political leaders
• Sought to rebuild trust through openness and transparency by holding regular press conferences and interviews and pledging to work with Congress and the public to address the country's problems
• However, the pardon of Nixon undermined efforts to restore trust with many Americans seeing it as a betrayal of justice and continuation of Nixon-era corruption reinforcing perception of a "corrupt bargain"
• Also faced challenges dealing with fallout from Watergate by navigating ongoing investigations and legal proceedings and facing pressure from Congress and the public to hold Nixon and other officials accountable
• Despite efforts, Ford struggled to fully restore public trust with approval ratings remaining low and lingering effects of Watergate and economic challenges continuing to undermine public confidence in government

Ford's Presidency: Economic Stagflation

Causes and effects of stagflation

• Stagflation refers to a period of high inflation, slow economic growth, and high unemployment that erodes purchasing power, leads to stagnant wages and reduced job opportunities, and leaves many people out of work and struggling financially
• Several factors contributed including the 1973-74 oil crisis sharply increasing energy prices, the end of the Bretton Woods monetary system in 1971 declining the dollar's value and increasing inflation, and government policies like price controls and high spending
• Effects were severe and widespread with rapidly increasing cost of living, businesses struggling with rising costs and reduced demand leading to layoffs and bankruptcies, poor stock market performance eroding investments and savings, and declining public confidence contributing to a sense of malaise and frustration

Ford's economic crisis response

• Implemented several measures to combat inflation and stimulate the economy:
  1. Launched the largely symbolic Whip Inflation Now (WIN) program in October 1974 encouraging voluntary reduction in energy use and spending, limiting price and wage increases, and promoting awareness through distributed buttons and materials
  2. Imposed a temporary 5% tax increase on corporations and high-income individuals to reduce the budget deficit and curb inflation
  3. Proposed a $16 billion tax cut to stimulate consumer spending and economic growth
• However, efforts had limited success with the WIN program having little practical impact, the tax increase and budget cuts proving unpopular and facing Congressional resistance, and the delayed and reduced tax cut limiting its stimulative effect
• Faced criticism for policies being too little, too late and not addressing underlying structural problems like declining productivity and international competition
• Despite efforts, the economy continued to struggle with inflation peaking over 12% in 1974, unemployment reaching 9% in 1975, and sluggish real GDP growth averaging only 2.2% during Ford's tenure