The Economy: Pocketbook Politics

Buoyed by prosperity, most Americans by 1968 were able to forget economics at the ballot box and vote other imperatives instead. Their sense of financial freedom further weakened the traditional New Deal coalition, assisting Richard Nixon into the White House. Now that situation seems to be changing. Higher prices, rising unemployment, scarce credit, an erratic stock market have restored the pocketbook as a prime issue in this election year.

To meet that challenge, the Administration has made a massive and partly successful effort to restore calm and confidence. Both the politics and the economics of the slump depend heavily on mood....