In July 2004, Derek Seidman and I did an interivew for Counterpunch. Here is a brief comment from that interview.

“I think a lot about Nixon these days. It would be interesting to see that kind of crisis of legitimacy flowing into the second dip of a recession… maybe even another period of stagflation.”

Now things begin to get interesting as the impact of rising oil prices, exacerbated by the US war against Iraq, begins to bite. Here are a few excerpts from recent news stories:

Jun 16, 2006

EYE ON AMERICA
Stagflation becomes a danger
By Peter Morici

On Wednesday, the Labor Department reported that the Consumer Price Index rose 0.4% in May on a seasonally adjusted basis, as energy prices surged 2.4%. The consensus forecast was 0.5%, and my forecast, published by Reuters, was also 0.3%. Seasonally adjusted, food prices were up 0.1% in May after virtually no change in April. Wholesale prices for food fell 0.5% in May and rose only 0.1% in April, indicating inflationary pressures from food prices should be moderate through the summer. FULL

U.S. ‘Stagflation’ Worries Mount
Inflation data and a possible Fed rate hike stir fears of prices rising amid a languishing economy.
By Lisa Girion, Times Staff Writer
June 15, 2006

With inflation heating up amid the prospect of another interest rate hike from the Federal Reserve, some economists said Wednesday they were beginning to worry about a ghost from the past: stagflation.

Their concern over the dreaded affliction of rising prices in a languishing economy — last seen in the 1970s — follows a second day of bad inflation news. FULL

Get Ready For Stagflation
Richard Lehmann, Forbes/Lehmann Income Securities Investor 06.27.06, 2:35 PM ET

Media reports are full of inflation fears, and of speculation about the U.S. Federal Reserve’s policies for its containment. Fed Chairman Ben Bernanke is being hailed as the great inflation fighter who must raise interest rates to 5.25% or even 5.5% to head off this most onerous of economic events, even if it means tanking the economy. It reminds me of the battle over global warming, where environmental reform proponents argue that it is better to limit economic growth than risk the consequences of global warning, whatever those consequences may actually be. FULL

The Democrats think too much, say the Republicans; such men are dangerous. Vote for us; we’re dumb but tough. This may not be a surefire prescription for electoral success, but given the hole the Republicans have dug themselves into, I think Nixon would be proud. FULL

What is behind this? As is the case of much of the worst that happens in the US, Vice-President Dick Cheney’s fingers are all over it. Cheney served in the White House of Gerald Ford after Richard Nixon resigned in disgrace, and subsequently as a Republican member of a Democrat-controlled Congress. He bitterly opposed the assertion of Congressional and judicial power balancing presidential power. September 11 gave him the opportunity he had been waiting for. Five days after the attack he said in relation to the intelligence agencies: “And so it’s going to be vital for us to use any means at our disposal, basically, to achieve our objectives.”

Shades of Nixon.

When asked years after his resignation why he had undertaken illegal activity, Nixon replied: “Well, when the President does it, that means it is not illegal.” He went on: “If the President, for example, approves something because of national security then the President’s decision enables those who carry it out to (do so) without violating the law.”

So there it is. The real Nixon doctrine. FULL