“It’s the economy, stupid.”
- President Jim Rhodes, when asked what the most important issue to Americans was.
With the foreign policy team getting things under control on the international stage, Rhodes took to the field for his domestic agenda. The first order of business would be his budget.
The first Rhodes budget saw a dramatic shift in priorities. The
Tax Cuts and Jobs Act, as it was called, saw military spending way up compared to the McCarthy years to boost conventional arms, weapons sales, and the foreign policy team’s calls for investments in neutron bombs, anti-ballistic missile platforms, and the B-1 bomber. Social welfare spending was slashed, particularly Crusade Against Poverty legislation, and the Environmental Conservation Agency, already working on the smallest budget McCarthy could get away with giving them, was further cut. Part of the money, but not all of it, went to funding Rhodes’ job creation program, Jobs for Americans (JFA). The rest of the social spending money went to paying off part of the debt, despite the fact that the
Tax Cuts and Jobs Act was itself a deficit budget plan. As the title suggested, there were tax cuts across the board, but were particularly focused on small business owners and the middle class. Despite opposition from the Congressional Democrats and the most hawkish of budget hawks, the
Tax Cuts and Jobs Act easily passed through the Republican majority in both the House and Senate.
With his budget, Rhodes worked to ingratiate himself to Congress in an unprecedented wave of pork barrel legislation. Although technically speaking, pork barrel is defined as legislation not requested by the President and favouring a particular riding, you wouldn’t know it from what Rhodes was covering. Dams were paid for across the Midwest, South, and Western Interior, funding was boosted for facilities that may have otherwise been on the budgetary chopping block, and road maintenance was given extra mileage. When expenditures began to balloon beyond the budget estimates, Rhodes called for the use of self-issued state bonds to cover the rest of the costs, a tried and true method in Ohio [1]. The most notable of these projects was one of Rhodes’ big dreams for Ohio. When he was Governor, Rhodes had proposed a bridge crossing Lake Erie, connecting Cleveland to somewhere in southern Ontario, in Canada. His plan had been dismissed as impractical and overly-costly when Governor, but as President, Rhodes had money put aside to look into the idea. The most direct route would be connecting Cleveland to Rondeau Provincial Park, but that would raise all sorts of complications on jurisdictions between Canada’s Prime Minister, Pierre Trudeau, and Ontario’s Premier, Bill Davis.
The proposed location, in red, of Rhodes' Lake Erie Bridge, connecting Cleveland, Ohio, to Rondeau Provincial Park, Ontario, Canada.
Beyond the general pork barrel, Rhodes also put significant spending into building community colleges and the infrastructure to make them easily accessible. Rhodes was a high school graduate, but only attended Ohio State University for a semester before dropping out, a fact that he made sure as few people knew as possible. Because had always been self-conscious of his less-than-stellar education, and always put public and private education near the top of his list when it came to dole out funding.
Outside of the budget, Rhodes also made major changes to energy and infrastructure throughout his first year. Although, as of yet, there hadn’t been an economic war between the United States and the Organization of Arab Petroleum Exporting Countries (OAPEC), Secretary of State Nixon advised that in the likelihood that the Second War of Attrition escalated between Israel and Egypt, that the US would have to side with Israel, and OAPEC would attempt an oil embargo, as they had during the Six-Day War of 1967, but with a much more damaging effect on the American economy. This aligned with Rhodes' plans for ramping up the domestic energy sector. Oil, coal, and natural gas subsidies were boosted, and massive hydraulic fracturing (or high-volume hydraulic fracturing) was encouraged to more economically extract natural gas from sandstone, while the government also began to invest in means of more efficiently extracting shale fossil fuel and natural gas deposits through hydraulic fracturing. Oil drilling was also opened up in the Arctic National Wildlife Refuge in Alaska, despite significant pushback from environmentalists, Democrats, and Secretary of the Interior Clifford Hansen [2]. Rhodes also put price deregulation into place to lower consumption costs for Americans, but several other plans were sidelined, including proposals for a government-mandated synthetic fuel corporation, and a consolidated joint government-private coal company similar to Amtrak. The only consolation for environmentalists was Rhodes’ personal fascination in the idea of hybrid, gas-electrical cars. Rhodes had recently heard from Len Immke, the Owner and President of Len Immke Buick Columbus, that a local man had made a functional prototype of a hybrid vehicle. Interested by the idea, Rhodes had Immke work with a federal commission to investigate the possibility of mass production [3].
Secretary of the Interior Clifford Hansen was the most vocal opponent to drilling in the Arctic National Wildlife Refuge in Alaska within the Rhodes Administration.
Speaking of Amtrak, Rhodes also met with the transportation sector and their unions. Rhodes had no strong feelings either way when it came to unions, acknowledging their role in worker safety, as long as they didn’t get too much in the way of productivity. Meeting with the General President of the Teamster’s Union, Frank Fitzsimmons (who had replaced the recently disappeared Jimmy Hoffa), Rhodes maintained he had no intention of deregulating the transportation industry. Likewise, Rhodes met with the big airline corporations, such as Eastern, Midway, Braniff, Pan Am, Continental, Northwest, and TWA to work out an agreement. Rhodes agreed to maintain the regulations that kept out new competitors, in exchange for them lowering ticket prices to an agreed upon competitive cartel rate, and accepting reform and reorganization of the Civil Aeronautics Board (CAB). The CAB was notoriously sluggish and stuffed with red tape, and Rhodes intended to streamline the process of opening up new airspace to accommodate the increasing popularity of civilian air travel through. The giants of the airline industry agreed, and an de facto cartel was formed between them and the CAB [4]. Rhodes’ cooperation with the airlines was due in large part of his economic philosophy that could best be described as ‘liberal corporatism.’ Under Rhodes, the CAB continued to regulate and set fares for the airlines in a controlled competition that kept the ‘Big Seven’ airborne, and the unions together, but America’s airlines remained uncompetitive internationally, and ticket costs remained high.
An American airline first class lounge with open bar. Due to Rhodes coming to an agreement with the 'Airline Cartel,' air travel remained similarly extravagant and expensive, with large cushioned seats, plentiful legroom, and catering, despite attempts to lower costs for consumers.
But, transportation serves no purposes if there’s nowhere to go. Rhodes also worked to improve state and federal roadways to America’s cities, but caught a snag on the matter of New York City. In 1976, in one of his last acts as President, McCarthy had approved a sizable financial bailout of New York City, which had been facing bankruptcy. With the new money to work with, Mayor Abraham Beame was able to use austerity measures to keep the city solvent for the foreseeable future, but was in the midst of a political crisis from a series of riots that broke out in New York following a blackout. Once the riots were over, Beame tried to handle the city’s financial damages some more, and was able to do so with the bailout. Although he hadn’t been challenged within the Democratic Party, Beame was facing a narrow re-election compared to the Republican-Liberal Party alliance under the candidacy of Roy M. Goodman [5]. The question Rhodes was faced with was whether to continue with the precedent. Cities on hard financial times were now calling for similar bailouts, which Rhodes was inclined to grant for the sake of his own popularity, but he didn’t want every town in America calling for cash.
New York Mayor Abraham Beame was facing a tough, but not impossible, re-election against the Rockefeller Republican, State Senator Roy M. Goodman in 1977.
It was indeed the very issue that he was mulling over in late 1977 in the Oval Office when Nixon burst in with news from the Soviet Union…
“We can’t all just cut each others’ hair.”
- President Jim Rhodes on service economies
[1] Once elected IOTL, Jimmy Carter was notorious in Congress for cracking down on what he saw as wasteful pork barrel spending in legislation, even in Democratic ridings. Rhodes has basically done the opposite of that by relying on state bonds to pay for pork barrel.
[2] IOTL, Jimmy Carter, with the help of Mo Udall, passed legislation that protected the Arctic National Wildlife Refuge until OTL’s 2017 Tax Cuts and Jobs Act passed by the Trump Administration, which put large parts of the refuge up for sale.
[3] In a possibly apocryphal story, Rhodes claimed that he, along with Len Immke and Wendy’s founder Dave Thomas, had been in touch with a man who built a working hybrid car in the 1970s, but that, ultimately, no investment was made into it. For the purposes of the TL, I am assuming the story is true.
[4] IOTL, Carter deregulated the airlines, making tickets much more affordable and air travel much more common, with new airlines popping up to compete with the old giants (who almost all eventually went bankrupt). The end of broad airline regulation also ended the lavish and 'living room' airplane design in place of the more compact seating we know today.
[5] IOTL, Gerald Ford didn’t give New York a straight bailout, with a famous headline claiming “Ford to [New York] City: Drop Dead.” To cover costs, Abraham Beame put incredibly harsh austerity in place, and got third place in the Democratic primaries, behind Ed Koch and Mario Cuomo, with Koch ultimately beating Cuomo in the general. ITTL, without the highly unpopular austerity measures, Beame was able to ward off any serious primary challengers.