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In some political quarters there was open defiance: Democrat Preston Smith, John Connally's successor as Governor of Texas, announced that he had ordered state officials to proceed with scheduled 6.8% pay raises for teachers and other state government workers. There are problems with teacher contracts elsewhere. Most of them take effect at the start of the school year. Nixon took Smith's defiance calmly. "I think Governor Connally can take care of him," Nixon said. The Justice Department intends to ask for an injunction against Smith this week.
Connally may have a somewhat more difficult time taking care of congressional objectors to the President's New Economic Policy. Nixon held the Hill leaders' feet to the fire at their briefing early last week. "The basis of this program is legislation," he said. "If you don't hurry, it will hurt. We've got to do these things and we've got to do them now. Now."
Democrats hastened to spell out their objections. Wages are frozen, but not interest rates; strikes are discouraged, but profits are free to rise; the Administration's chief social welfare innovation, the family assistance program, carrying a guaranteed minimum income, has been deferred for a year as part of the price of economic stability. Said a Muskie aide: "You create enough money for millionaires to buy Cadillacs, and you create jobs for chauffeurs." Senator Muskie was more guarded, but he made approximately the same point. Said Muskie: "I don't believe that the best way or the fairest way to stimulate the economy is a series of large tax breaks for industry which far exceed their ability to expand, and which will depend on benefits trickling down to the consumer." Oklahoma's Senator Fred Harris described Nixon's program as "an economic fan dance which attempts to hide the pro-business bias of his proposals."
TIME Washington Correspondent Simmons Fentress summed up: "The Democrats have been embarrassed by this President who opened their closet and stole their shoes. They are by no means boxed in, however, and they are opening up alternate lines of attack." Post-Freeze Problems TIME Washington Correspondent Simmons Fentress summed up: "The Democrats have been embarrassed by this President who opened their closet and stole their shoes. They are by no means boxed in, however, and they are opening up alternate lines of attack."
Post-Freeze Problems
Neither the narrower political consequences nor the broader effectiveness of the New Economic Policy will be known for some time. Nixon's store of national good will is not overwhelming, but it should be enough to persuade most Americans to go along for the initial 90-day period, given the near universal dissatisfaction with the way the economy stood. More important, though, is what happens after the freeze expires—and that is a problem that the Administration is already worrying about.