How Nixon and the Rockefellers Teamed Up To Destroy the Dollar
August 15 marks a special date in American history: it commemorates the fiftieth anniversary of President Richard Nixon’s suspension of Bretton Woods. With this decision, the United States stopped redeeming foreign governments’ and banks’ dollars for gold. Consequently, the world economy transitioned to unconstrained central bank discretionary monetary policy, an unprecedented era in monetary affairs.
The traditional justification for such a momentous decision utilizes highfalutin rhetoric and appeals to the public interest: the gold constraint restricted the ability of wise economic planners to fine-tune the economy. However, as I document in Cronyism: Liberty versus Power in Early America, 1607–1849 (forthcoming, Mises Institute, October 2021), the actual reasons for government policies are due to self-interested politicians rewarding themselves and favored business interests at the expense of the public. Bretton Woods is no exception: Nixon suspended gold convertibility to enhance his 1972 reelection chances and benefit the Rockefeller-dominated Chase Manhattan Bank and other expansionary banking interests at the cost of higher inflation. When it comes to government, privileged interests always come before the public.
Nixon is one of America’s most notorious presidents because of his resignation following the Watergate scandal. This infamous attempt to steal the 1972 election is not the only aberration in Nixon’s career; all his life he was paranoid about elections and wanted to win at all costs. The former vice president was convinced that Federal Reserve contractionary monetary policy denied him the 1960 presidential election against John F. Kennedy. Nixon also insisted that Fed restrictionism contributed to Republican setbacks in the 1970 midterms. He was so concerned about elections that after assuming office in 1969 he candidly told his White House advisers that “political considerations” will often override the “economic standpoint.”1 At the top of his priorities was ensuring victory in 1972. To accomplish this, Nixon wanted the Fed to provide “a rate of monetary expansion sufficient to move the economy up on the desired path.”2
Major banks also supported cheap credit. They maintained close links with the administration, particularly the Chase Manhattan Bank, which was dominated by the wealthy Rockefeller family and had the most assets ($31.7 billion) out of any financial institution in 1968. Although Nixon ran against New York governor Nelson Rockefeller in 1968, he cozied up with Rockefeller interests after becoming president. He offered Nelson’s brother David, the chairman of Chase’s board of directors, the secretary of the Treasury position multiple times. Although David declined, the job went to David M. Kennedy, a banker recommended by the Chase board. Under secretary of the Treasury for monetary affairs went to Paul A. Volcker, a former vice president of Chase. Rockefeller men also commanded the State Department, which played a role in international monetary affairs. Nixon’s first secretary of state was New York lawyer William P. Rogers, a law partner of John A. Wells, one of Nelson’s campaign managers. In 1973 the job went to Henry Kissinger, special assistant to the president for national security affairs. Kissinger had assisted Nelson in his presidential bid and later served as vice-chairman of Chase’s international advisory committee. Nelson even gave Kissinger $50,000 three days before he started working for Nixon to
Article from LewRockwell