Gas Shortage and Price Controls
The gas shorted was, in large part, caused by price controls, implemented by Ford and Nixon. Carter relaxed, if not eliminated, these price controls. This resulted in the measured increase in inflation. Carter did not cause the inflation. He caused the inflation to become apparent, and then took measures to reduce it (How gas price controls sparked ‘70s shortages).
Carter selected Volker. It was Volker, during the Carter administration, who tightened monetary policy, reducing inflation (Volcker’s Handling of the Great Inflation Taught Us Much). Of course, monetary policy does not have an immediate impact, and restricting the supply of money was a hard pill to swallow. But had the price controls not been lifted, and had the supply of money not been reduced, the fallout would have been far worse. Basically, the bitter medicine worked. But it was not until the Reagan administration that people realized the benefits.
Carter did not increase taxes. In fact, under the Carter administration, tax rates were simplified and the marginal tax rates, for the average earner, declined (U.S. Federal Individual Income Tax Rates History, 1862-2013 (Nominal and Inflation-Adjusted Brackets)).
Aside from lifting price controls, Carter deregulated multiple industries, including the airline and railroad industries. This was part of an extensive plan to deregulate transportation.
Motor Carrier Act of 1980
Carter should also be well known for the deregulation of the trucking industry. He, along with others during his administration, worked to craft the Motor Carrier Act of 1980. The act largely eliminated rate controls and shipping route monopolies. Before the act, in order to enter the market, a new trucking agency would basically have to purchase the rights to a shipping route from an existing carrier. The deregulation of the industry greatly reduced costs and increased competition among carriers. This cost reduction was passed on to the consumer, reducing overall shipping costs. (Trucking Deregulation)
He also legalized home brewing, at least on the federal level (How Jimmy Carter Sparked the Craft Beer Revolution – KegWorks Blog). Without home brewing, there would be far fewer microbreweries, because people would not have been able to learn how to brew, try test batches, show those batches to friends, etc.
Did spending increase under Carter? Yes. By any significantly higher rate than it has in most other administrations, especially recent ones? No (Government Spending Chart).
From 1976 through 1980 spending grew from $5,180 per capita (inflation adjusted) to $5,878 per capita (inflation adjusted) for an annualized rate of ~3.2% Meanwhile, under Reagan per capita spending grew from $5,878 to $7,035 for an annualized rate of ~2.3% Was this lower than Carter’s spending? Is the difference in actual spending anywhere near as great as what people perceive it to be? Probably not.
Not all of Carter’s decisions were good. Carter implemented the Community Reinvestment Act, an act which would eventually help bring about the “Great Recession.” However, the original form of the act was far more benign, and had it been left alone, things would probably be different today. The major changes to the CRA took place in the 90s (Here’s How The Community Reinvestment Act Led To The Housing Bubble’s Lax Lending – Business Insider). And as mentioned before, he did increase spending by more than many other presidents. Government spending is certainly not the answer.
Lack of Perspective
But even with his mistakes, he was a far better president than people want to admit. So why does Carter get a bad reputation? It’s partly due to the fact that he only had one term. It often takes years for the effects of policy decisions to take hold. In some cases, it can take decades, in which case we need to look back on history and reevaluate our past biases, based on what we know today. Unfortunately this is often difficult with all the political rhetoric. Carter was blamed for the bitter effects of the medicine which fixed the economy, while Reagan was lauded for the benefits of Carter’s decisions.
If we were to truly look back, we would see a president who deregulated industries and lifted government manipulation of prices, supported intelligent monetary policy, and cut taxes. By all accounts, Carter would be listed as a fiscal conservative and probably even as a libertarian, by today’s standards.