Nixon—Domestic Policies and Political Scandal

In addition to dealing with the Cold War, the war in Vietnam, and riots and protests on the home front, President Richard Nixon also dealt with a host of domestic issues during his presidency.

The Economy

Largely due to the war in Vietnam, the economic growth that had persisted after World War II came to a screeching halt.  Inflation and unemployment grew quickly, and economists began using the term “stagflation” to refer to the unusual situation of having simultaneous inflation and unemployment growth.  The American economy was also losing ground internationally; in 1971, the U.S. imported more than it exported for the first time in the twentieth century.  Although Nixon had always opposed government intervention in the economy, he now advocated a government remedy and in the summer of 1971 announced a “new economic policy.”  The policy called for a ninety-day freeze on increasing prices or wages, as well as government oversight of future increases.  Nixon also purposefully devalued the dollar, making American goods cheaper—and hopefully more competitive—overseas.  This did not work as he hoped, as imports continued to grow at a faster rate than exports.

“New Federalism”

Nixon attempted several changes in domestic programs during his tenure; some succeeded and some did not.  Nixon succeeded in getting Congress to go along with his “new federalism” plan.  This revenue-sharing plan returned a percentage of federal tax revenues to state and local governments.  Given in “block grants,” the state or local governments were allowed to use the funds as they chose, rather than being told how to use them by the federal government.

Congress and Social Welfare

During the Nixon years, Congress—controlled by Democrats—increased the aid available to those in need.  Congress approved Supplementary Security Insurance payments to disabled, blind, and elderly persons, as well as large expansions of Medicare and Medicaid.  Congress also authorized Social Security benefits to automatically increase with inflation.  During the 1970s, the percentage of the national budget allocated to social welfare programs rose from 40.1 percent to 53 percent.

The Supreme Court

When Nixon campaigned for the presidency, he made it clear that he opposed the Warren Court—he said he would appoint justices who would “apply” the law, rather than “make” it.  After Earl Warren’s retirement, Nixon appointed Republican-minded Warren Burger as Chief Justice.  He also appointed Harry Blackmun, William Rehnquist, and Lewis Powell—all Republicans—to the Supreme Court.  Learn more about the justices in Nixon’s Supreme Court Appointees Interactive.

The Burger Court dealt with a variety of rights-related cases.  The Court found that the states could cap the amount of money paid to welfare recipients if they chose, basically rejecting the idea that welfare was a national right.  In regard to health, safety, and environmental laws, however, the Court upheld the national government’s right to institute regulations such as the Occupational Safety Act of 1973.  The Court also upheld the national government’s authority in relation to abortion; in 1973, the Court issued its Roe v. Wade decision, finding that states did not have the right to outlaw abortion.

Watergate

A perpetual sense of paranoia and suspicion led President Nixon to worry about his enemies, both real and perceived.  Nixon's staff created their own secret intelligence entity—infamously dubbed “the plumbers”—to work out of the White House.

The Pentagon Papers

In the summer of 1971, State Department employee Daniel Ellsberg leaked top-secret government papers on the Vietnam War to the New York Times.  The classified papers stated that the government was misleading the public, that there was no hope of winning the war, and that the situation in Vietnam was basically a civil war that did not involve the U.S.  Outraged, Nixon tried to get a court order to stop publication of the information.  That failed, so Nixon sent his “plumbers” to Ellsberg’s psychiatrist’s office to look for anything to discredit Ellsberg.  This was the first in a series of stunts and crimes undertaken by the Nixon Administration; many of these endeavors were financed by Nixon’s 1972 campaign funds.

The Election of 1972

Nixon won re-election easily in 1972, defeating Democratic Senator George McGovern of South Dakota in a landslide.  Unfortunately for Nixon, he and his advisors worried that the situation in Vietnam as well as domestic economic troubles might cause him to lose the election.  They created a campaign organization of their own, separate from the Republican Party.  CREEP—the Committee to Re-elect the President—raised millions of dollars, largely illegally.  Scroll over the 1972 Presidential Election Interactive to see Nixon’s victory.

The summer before the election five men were arrested for breaking and entering the Democratic National Committee headquarters in the Watergate office complex.  Investigations conducted by the FBI, Senate and House committees, and the press exposed the burglary as one in a series of illegal activities authorized and executed by Nixon’s staff and advisors.  The various crimes attributed to CREEP and Nixon’s inner circle included campaign fraud, political sabotage, break-ins, illegal wiretapping, and illegal fundraising.

White House Tapes

President Nixon and his advisors scrambled to cover up the break-in soon after it occurred.  A two-year investigation ensued and it was eventually disclosed that every conversation held in Nixon’s Oval Office had been taped.  Known as the “White House Tapes,” these recordings were sought by Congress, the independent prosecutor appointed to the case, and the judge presiding over the trial of the Watergate burglars.  Nixon refused to release the original tapes.  In July 1974, the Supreme Court ruled in U.S. v. Nixon that Nixon could not use “executive privilege” to refuse to release the tapes. The Court's decision coupled with congressional hearings on the Watergate matter meant that impeachment was inevitable. Nixon chose to resign rather than suffer the humiliation of being impeached, tried in the Senate, and removed from office.

Legacy of Watergate

On August 8, 1974, President Nixon went on television and announced his resignation.  Nixon’s vice president, Gerald Ford, assumed the office of the presidency upon Nixon’s resignation, and his first act as president was to pardon Nixon on September 8, 1974.  Although there was no evidence that Ford and Nixon had worked together to get Nixon off the hook, the pardon left a bad taste in the mouths of many Americans.  Many people at the time believed that the events surrounding the Watergate scandal had posed a serious threat to constitutional government.  The events of Watergate combined with the Vietnam War and other upheavals of the 1960s and early 1970s to shake Americans’ faith in government and created a lasting cynicism among many Americans.