by Dick Cheney
As assistant director for operations, I oversaw some three thousand IRS agents tasked with enforcing wage and price controls. At one point I sent a team of them to visit the major food chains, such as Safeway and Giant, and report on how they were complying with our regulations. The agents reported back that, depending on how a single regulation was applied, any one of several different prices might result, from one high enough to give the chain a significant profit to one low enough to cause a terrible loss. It was pretty clear which option the chains would pick—and who could blame them? They were dealing rationally with the arbitrary rules we were trying to impose.
As a junior staffer in the White House, I didn’t see that much of the president, but occasionally I attended meetings at which he presided, usually so I could flip charts as Rumsfeld made a presentation. One day at a meeting in the Cabinet Room, I sat in one of the chairs lining the wall as the president’s economic advisors debated reimposing a freeze on food prices. After letting the discussion continue for a while, Nixon finally spoke. He recalled a conversation he had had with Nikita Khrushchev at the Soviet premier’s dacha back in 1959. After a long lunch, Khrushchev became expansive. He said that sometimes in order to be a statesman, you have to be a politician. If the public sees an imaginary river in front of them, the politician doesn’t tell them there’s no river. A politician builds an imaginary bridge over the imaginary river. Nixon told the story as though there was guidance to be found in it, and I took his point to be that if the public thought food prices were a problem, the politician should offer a solution, thereby preserving his ability to make statesmanlike decisions another day.
A year after I heard President Nixon tell the Khrushchev story, he imposed another price freeze, apparently hoping in the midst of Watergate for some political benefit. But he didn’t get it. Among other things, the freeze made raising animals for market unprofitable. A Texas hatchery drowned forty-three thousand baby chicks. Pigs and cows were slaughtered—and the president announced an early end to his 1973 effort to freeze prices.
By this time I had grown wary of government economic control. At the start of my tenure at the Cost of Living Council, when I had been immersed in getting things going, I hadn’t had much time to think about it, but by now I realized that every day millions of people were making millions of economic decisions, and it didn’t matter how smart we were or how many regulations we wrote. There wasn’t any way we could intervene without doing more harm than good.
These thoughts confirmed my innate skepticism about what government could and couldn’t do. We could write checks, and we could collect taxes. We could run the whole military and defense side of things. But when something as big and ham-handed as the federal government tries to run something as complex and dynamic as the American economy, the result is sure to be a train wreck.
AT CLC RUMSFELD CONTINUED his usual pace, in early, out late, and cramming more into his average day than many manage in a busy week. And he was sending out hundreds of small notes, requests for information or demands for action that were so numerous we called them “snowflakes.” His secretary, Brenda Williams, would type them up in memo form for forwarding to the relevant departments or individuals. Lest the whole place be overwhelmed, however, she would bring the snowflake memos to me first, so I could try to put them in some kind of realistic priority, based on my knowledge of what Rumsfeld really wanted and needed. I would decide which ones should be sent and which could probably be safely ignored. Brenda kept copies of both in separate files.
One morning my direct line from Rumsfeld rang. “Get down here now,” he said. When I rushed in, Brenda was already there. Rumsfeld was looking at two substantial piles of paper on his desk. I could see that they were the carbon copies of the snowflakes and I could figure out what the two piles represented—what we’d sent and what we hadn’t.
After a moment of silence, he said calmly, “I just want you to know that I know what you’re doing.” That was it. And that was all. We were dismissed and we returned sheepishly to our desks—and continued exactly as before. But we had shared what I think of as a classic Don Rumsfeld moment. He had somehow figured out what we were doing. He didn’t say that we had been wrong. And he didn’t tell us not to do it anymore. But he wanted us to know that he knew. So he told us and let us draw our own conclusions.
ON JUNE 12, 1972, George Shultz, who had been director of the Office of Management and Budget, was sworn in as secretary of the Treasury. On his first day in his new office, Secretary Shultz scheduled a meeting with the CLC senior staff. He closed the door, sat down, and said, “Okay, gentlemen, the first thing we’re going to do is get out of these controls.”
And that is what we did. We put together a strategy for moving into Phase Three (which would depend on voluntary self-restraint by business and labor regarding increases in prices and wages), and, finally, into Phase Four (which was intended to complete the return to the free market). Rumsfeld and I left the Cost of Living Council before these strategies were fully implemented. Others would oversee the process by which a massive interference with the American economy ended nearly three years after it had begun. Or mostly ended. In the oil industry, the price controls that went on in 1971 didn’t come off until President Reagan removed them in 1981. For nearly a decade, price controls on oil and gas acted as a disincentive to achieving the fuel efficiency that we finally came to recognize as crucial.
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ON NOVEMBER 7, 1972, Richard Nixon was reelected in one of the biggest victories in presidential history. Lynne and I stood near the front of the crowd that gathered to celebrate his victory in the ballroom of the Shoreham Hotel. People were excited—at least until the president took the stage. He was subdued, not at all like a man who had just been reelected to the presidency with forty-nine out of fifty states. It was almost as though he were anticipating the scandal and tragedy that would soon engulf his administration.
Over the last several months in the White House and during the campaign, Rumsfeld had become increasingly disenchanted with the president and his senior staff; and, at least on the part of the senior staff, I think the feeling had been reciprocated. If they saw him as a non–team player, he saw them as out of touch and riding for a fall. He turned down the domestic positions they offered him, including head of the Republican Party, and accepted an appointment as ambassador to NATO, which was headquartered in Belgium.
Rumsfeld asked me if I would like to go to Brussels with him, but it didn’t seem right for me and my family, and I had another opportunity. A group of friends, Alan Woods, Bruce Bradley, Tony Brush, and Paul Ripp, had set up an investment advisory business in Washington. Alan was getting ready to leave, and I was asked to join the firm as a partner. At Bradley Woods we gave political and policy advice to clients, which were mostly big banks, insurance companies, and mutual funds. We deciphered legislation and explained how it might impact portfolios and investment strategies. Having been a behind-the-scenes man for so long, I found that I actually enjoyed getting up in front of groups and talking about what I knew and thought and answering questions.
I quickly got used to relatively normal working days, having weekends off, and moving beyond a government salary. Lynne and I bought our first house, a three-bedroom in Bethesda, Maryland, with a fenced-in yard for the kids and the dog.
LIKE EVERYONE ELSE, I was first surprised and then appalled as the details of the Watergate scandal reached critical mass in the spring of 1973. I had known some of the people involved. I had attended meetings with them and eaten lunch with them at the round staff table in the White House Mess.
I had very few direct dealings with Haldeman or Ehrlichman on a daily basis when I was working for Rumsfeld. But one incident was perhaps emblematic of the attitude that led to some of the problems. In February 1970, Rumsfeld took a few days to go skiing with his family in Colorado. When an urgent meeting was scheduled in Washington, we decided that I would ride out on the military plane that was going to pic
k him up, so that I could bring all the necessary documents and briefings and we could work together on the flight back to D.C. Then I got a call asking if I would mind leaving early enough to make a detour to deliver an important package to Ehrlichman, who was skiing in Sun Valley, Idaho.
A White House car picked me up at home and brought me to the West Wing, where the package—a securely taped manila envelope—was waiting. We continued on to Andrews Air Force Base, where I boarded a small government jet. When we landed in Idaho, a car sped out on the tarmac. Two armed MPs emerged and boarded the plane. One introduced himself as the courier who would deliver the package to Ehrlichman. I handed it to him and figured that my assignment was now completed.
“Sir, do you know what the contents are?” he asked. I told him that I didn’t know. He asked if I minded whether he opened it, and I told him to go ahead if he thought it was important. He slit the tape, opened the flap, and removed copies of the most recent issues of Time, Newsweek, and U.S. News & World Report. I hid my dismay as the MPs carefully put the magazines back in the envelope, saluted, and disembarked. Rumsfeld ran such an obsessively frugal and ethical operation that I could hardly believe someone would send a government plane eight hundred miles out of the way to deliver magazines. I later wondered if this episode didn’t reveal some of the arrogance that led to Watergate.
FROM THE OPENING OF the Senate Watergate committee hearings in May 1973 until the House Judiciary Committee voted out three articles of impeachment in July 1974, the flow of stories and leaks and charges went on day after day, week after week, month after month. The scandal unfolded like a novel, with one stunning revelation after another, most of them coming by way of the Washington Post. Many mornings Lynne and I didn’t want to wait for the newspaper to be delivered to our door, so one of us would leave our Bethesda house in the predawn hours and walk to a nearby street corner, where a delivery truck dropped off bundles of the Post. We’d extract a copy, leave a note for the paper boy telling him not to deliver us another one, and then head home to read about the unraveling of the Nixon administration. It was a sad and amazing spectacle, and as I watched the story unwind, I felt a sense of relief in being away from the whole thing.
Deciding to get out of government when Don Rumsfeld departed for Brussels was turning out to be one of my wiser choices in life. I had no idea that I was soon to be drawn back in.
A phone call was my first indication. It came on August 8, after I’d had dinner at the northwest Washington home of our friends Bill and Janet Walker. My family was in Wyoming, so the Walkers had invited me over, and we watched President Nixon announce that he would resign the next day. When I got back to my empty house in Bethesda, the phone was ringing. It was Lee Goodell, Don’s assistant, telling me that Don had been asked to come back to Washington by Vice President Gerald Ford. Would I meet his flight, she asked?
The next day I watched President Nixon’s farewell address on a television set in my H Street office. I watched the Fords walk him out to the helicopter and saw Gerald Ford sworn in at noon. Then I headed for Dulles International Airport, where Rumsfeld’s plane would soon be landing.
CHAPTER THREE
Backseat
While I waited for Rumsfeld’s flight, I was joined by a White House driver carrying a message for Don. The new president wanted Rumsfeld to head up his transition team. As we left the airport and headed for D.C. in the White House car, Don showed me the message and asked me if I would take a few weeks off from my job to help him out. It wasn’t a question I had to think twice about. A president had just resigned under the most extraordinary circumstances, another had been sworn in, and I had a chance to assist in the changeover.
As we drove into the White House complex through the southwest gate, I couldn’t help but think with amazement that I had left government eighteen months ago, and now here I was right back in it. I was fully aware that the fact that I had left before Watergate erupted was one of the reasons I was here, and the same was true of Don. He and I had one other advantage. We were both young and foolish enough to think there wasn’t anything we couldn’t do.
The transition office was in the basement of the Old Executive Office Building, and I spent the next ten days there, writing and reviewing sections of the transition report. I wasn’t senior enough to be in the meetings with the president, but the orders I got secondhand were unequivocal and unmistakable: We were to stick to organizational and domestic matters. President Ford didn’t want any recommendations for changing foreign policy. He believed that continuity there was essential. Indeed, on the night before he became president, he had stepped outside his house in Virginia to announce that Secretary of State and National Security Advisor Henry Kissinger would be staying on.
Perhaps the new president’s most pressing decision involved the selection of his vice president—and that was also to be outside the purview of the transition committee. Bryce Harlow, an old Washington hand trusted by all, was instrumental in the process. Harlow prepared a tally sheet on a yellow legal pad, listing all the possible vice presidential choices down one side and their qualifications on the other. Ford later told me that his choice had really come down to three individuals: Nelson Rockefeller, George H. W. Bush, and Don Rumsfeld.
Ford said he viewed Bush and Rumsfeld as the future of the party, and Rockefeller as the establishment candidate. He went with Rockefeller, in large part because the unique circumstances of Ford’s sudden accession to the presidency called for a vice president who needed no introduction to the world.
On the evening of August 19, 1974, Don happened to be at our house in Bethesda. We listened to the kitchen radio as news reports described the unfolding scene at Rockefeller’s New York estate, where aides and family members were gathering. A fleet of sedans was lined up, and Rockefeller family jets stood by ready to fly the whole entourage to Washington. Don laughed at the superior resources Rockefeller brought to the competition. “Here’s Nelson Rockefeller with planeloads of people flying down from New York,” he said, “and all I’ve got is you, Cheney.”
Shortly after the Rockefeller announcement, the transition team presented its report to the president. Rumsfeld and I went our separate ways, he back to his NATO post in Brussels and I back to Bradley Woods. Thus, like most of America, I was surprised a few weeks later when on September 8 President Ford announced that he was granting a “full, free, and absolute pardon” to Richard Nixon. He described his action as a way to “shut and seal” the matter of Watergate and to mitigate the suffering of Richard Nixon and his family.
All these years later, the wisdom and generosity of Gerald Ford’s instincts have been recognized for their courage and honored for their rightness. But at the time the pardon was controversial and unpopular. I was among the majority of Americans who thought then that it was a mistake. While I was prepared to believe that it might be justified eventually, I was sure that it would cost Ford too much of his support in the near term.
The immediate result was indeed a firestorm of controversy and criticism. According to a Gallup poll, Ford’s approval rating dropped from 71 percent to 49 percent. The press corps declared the pardon indefensible. They condemned the president and lionized their former colleague Jerald terHorst, whom Ford had just named as the White House press secretary. When terHorst was informed about the pardon, he resigned in protest just as the president was about to go on camera. Across the country people who had been relieved by Ford’s becoming president turned negative. There were widespread rumors about a secret deal, with Ford being elevated to the presidency in return for promising to pardon his predecessor. News of all this was accompanied by stories of bitter turmoil and conflict between Nixon and Ford people in the White House—at least some of which were true.
In addition to the negative impact on the president’s own approval rating, the pardon clearly hurt us in the 1974 elections, which followed less than two months after the pardon was issued. Many commentators believe it ultimately cost Ford reelection. The
impact of the pardon was intensified by the fact that it was a total surprise to everyone. Ford announced it on a Sunday morning at a time when not many people were watching television, so few Americans heard his explanation directly. Additionally, the announcement was made without any notification to the Congress or discussion in the press. I always believed that the negative impact could have been lessened if more thought had been given to how the pardon was announced.
While I was unfortunately accurate in my assessment of the negative political impact, I was wrong about the wisdom of the pardon itself. It was clearly the right decision, and over the next few years in the White House, I was thankful that Watergate was behind us rather than hanging over our heads with a former president facing trial.
A week or so after the pardon, I was in Florida on a business trip when I got a call from Rumsfeld. Once again the president had asked him to come back from Europe, and once again he wanted to meet with me before he went to the White House. On Saturday night, September 21, we met in his room at the Key Bridge Marriott, just across the Potomac River from Georgetown, and he said he believed President Ford was going to ask him to be White House chief of staff. If he took the post—and given the serious disarray at 1600 Pennsylvania Avenue, that was a big if—he wanted to know whether I would agree to sign on with him. I said I would. When he called me the next morning, he had accepted the job and asked me to be his deputy.
A week later, on Sunday, September 29, I met President Ford for the first time.
With President Ford during one of our daily sessions in the Oval Office (Official White House Photo/David Kennerly)
Rumsfeld had a meeting at the White House, so I went with him to look around the chief of staff’s West Wing suite in preparation for moving in. I remember being particularly fascinated with the desk that Nixon’s chief of staff, Bob Haldeman, had designed especially to meet his needs. It was enormous, covering an entire wall, and it was an electronic masterpiece that included the ability to record office conversations. The phones were all equipped with “cutout” buttons that permitted a secretary or an aide to pick up an extension and listen in without the outside party hearing any telltale clicks.
