The Federal Reserve’s great anti-hero deserves a second look

took off, a former Federal Reserve chair has been on the minds of politicians and pundits. A number have argued that Jerome Powell, the current incumbent, must not become the next Arthur Burns. As chair of the Fed in the 1970s, Burns represents central-banking failure: a weak leader who blinked in the face of inflation and steered the economy towards disaster. It is not that this warning from history is incorrect. Richard Nixon picked Burns to run the Fed, viewing him as a friend who would do his bidding. Despite stubborn inflation, Nixon pressed Burns to cut interest rates in 1971, thinking it would help him win re-election. Sure enough, the Fed did just that. Nixon was re-elected and inflation soared, hitting double digits by 1974.