The unraveling was largely Nixon’s doing. Connally had left Treasury in 1972, and while his successor, George Shultz, favored floating rates, he generally restricted himself to doing the president’s bidding. As for Nixon, it wasn’t so much that he wanted to destroy Bretton Woods and the gold standard as that he couldn’t be bothered to save them. Garten offers this exchange from the White House tapes between the president and his chief of staff, H. R. Haldeman:
Haldeman: Did you get the report that the British floated the pound last night?
Nixon: No. I don’t think so, they have?
Haldeman: They did.
Nixon: That’s devaluation?
Haldeman: Yeah. [White House aide Peter] Flanigan has a report on it here. …
Nixon: I don’t care. Nothing we can do about it.
Haldeman: [Federal Reserve Chair] Burns is concerned about speculation about the lira.
Nixon: Well, I don’t give a shit about the lira.
Nixon’s main concern in 1971 had been avoiding a recession that could cost him the 1972 election. He badgered Burns into keeping rates low in the face of rising consumer prices, and saw the barrage of policy moves that together constituted the “Nixon shock” as a way to take decisive-seeming action against inflation and other economic woes without causing a slowdown. The policy that got the most attention at the time was not the gold decision but a wage-and-price freeze that was initially popular but ultimately ineffectual, giving way to a new inflationary spiral that made sticking to any managed exchange-rate regime impossible.
Garten doesn’t gloss over any of this, which makes his positive verdict at the end a little jarring. He’s not necessarily wrong, though. The attempt to stick to the gold standard in the 1930s has in recent decades been identified by economists as a major reason for the depth of the Great Depression, putting the choice to abandon it in the 1970s in a better light. And while many of the decisions that led to floating rates appear to have been myopic and half-baked, to a seasoned Washington veteran that may just be par for the course.
Garten is one such seasoned Washington veteran, having joined the Nixon White House in a junior role in 1973, then staying on at the State Department for the Ford and some of the Carter years before embarking on a Wall Street career. He returned in the early 1990s as an under secretary of commerce in the Clinton administration, leaving that job for a successful 10-year run as dean of the Yale School of Management, where he continues to teach. He is now best-known to the wider world as the recurring character “Jeffrey” on the long-running Food Network show “The Barefoot Contessa,” hosted by his wife, Ina Garten. But he remains a well-connected, well-respected emeritus member of the financial-political elite.
That point of view robs “Three Days at Camp David” of much of the bite it might have if written by a journalist or conventional academic. But it adds a perhaps useful appreciation for how hard it is to get things right in government.