G. William Miller

Infobox_President | name =George William Miller
nationality =American


imagesize =176px
order =11th
title =Chairman of the Board of Governors of the Federal Reserve
term_start =March 8, 1978
term_end =August 6, 1979
president =Jimmy Carter
predecessor =Arthur F. Burns
successor =Paul Volcker
order2 =65th
title2 =United States Secretary of the Treasury
term_start2 =August 6, 1979
term_end2 =January 22, 1981
predecessor2 =W. Michael Blumenthal
successor2 =Donald Regan
birth_date =birth date|1925|3|9|mf=y
birth_place =Sapulpa, Oklahoma
death_date =death date and age|2006|3|17|1925|3|9
death_place =
spouse =
profession =Lawyer| George William Miller (March 9, 1925 – March 17, 2006) served as the 65th United States Secretary of the Treasury under President Carter from August 6, 1979 to January 20, 1981. He previously served as the 11th Chairman of the Federal Reserve, where he began service on March 8, 1978.

Miller was the first and currently only Federal Reserve Chairman to come from a corporate background, rather than from economics or finance. He is also the only person to have served both as Federal Reserve Chairman and as Treasury Secretary.

Early life and career

William Miller was born in Sapulpa, Oklahoma. His family soon moved to Borger, the largest city in Hutchinson County, Texas, where Miller spent his childhood. After attending Amarillo College for the 1941-1942 school year, he received an appointment to the U.S. Coast Guard Academy. He graduated in 1945 with a B.S. in marine engineering and served until 1949 as a Coast Guard officer in the Far East and on the U.S. West Coast. During his time with the Coast Guard, he met and then married Ariadna Rogojarsky, a Russian emigre. He received a law degree from the Boalt Hall School of Law at the University of California, Berkeley in 1952, and joined the law firm of Cravath, Swaine & Moore in New York City.cite news |first=Adam |last=Bernstein |title=Obituary: Fed Chairman G. William Miller, 81 |url=http://www.washingtonpost.com/wp-dyn/content/article/2006/03/19/AR2006031901108.html |publisher="The Washington Post" |date=2006-03-20 |accessdate=2007-11-21 ]

In 1956, Miller joined Textron, Inc as an assistant secretary. He became a Vice President of the company in 1957 and President in 1960. In 1968 he became Chief Executive Officer of Textron and was elected Chairman and Chief Executive Officer in 1974, a post he held until he came to the Federal Reserve Board.

Miller also forayed into politics. From 1963 to 1965, Miller was Chairman of the Industry Advisory Council of the President's Committee on Equal Employment Opportunity; in 1966 and 1967, he was a member of the National Council on the Humanities. Miller also served in the "think tank" Club of Rome. In 1968, he aided Hubert Humphrey's presidential campaign as chairman of a Democratic-leaning business group.cite news |title=Obituary: G. William Miller |last=McFadden | first=Robert D. |url=http://www.nytimes.com/2006/03/19/national/19miller.html |publisher=The New York Times |date=2006-03-19 |accessdate=2007-12-06 ]

At the time he joined the Federal Reserve Board, Miller was a director of the Federal Reserve Bank of Boston and of several corporations. He was also a member of the Business Council and the Business Roundtable and Chairman of the Conference Board and of the National Alliance of Businessmen.

Federal Reserve Chairman

Miller succeeded Arthur Burns as Fed Chairman in January 1978. He inherited a high inflation economy, still suffering from the increase in oil prices from OPEC. The change in the Consumer Price Index was 4.9% in 1976 and 6.7% in 1977. [ [http://www.bls.gov/cpi/home.htm Consumer Prince Index] , from the Department of Labor] Nevertheless, Miller maintained a Keynesian belief that inflation could "prime the pump" of the economy, and would at any rate be self-correcting. [cite web |url=http://www.buyandhold.com/bh/en/education/history/2000/paul_volker1.html |title=Educate Yourself: Paul Volcker |accessdate=2007-12-06 ] He thus pursued a strongly doveish policy and opposed raising interest rates. The effect of this was to send the dollar's value spiraling downward. In November 1978, only 11 months into his term, the dollar had fallen nearly 34% against the German mark and almost 42% against the Japanese yen, prompting the Carter administration to launch a "dollar rescue package" including emergency sales from the U.S. gold stock, borrowing from the International Monetary Fund, and auctions of Treasury securities denominated in foreign currencies.cite web |url=http://www.federalreserve.gov/monetarypolicy/files/fomcropa19781121.pdf |title=Record of Policy Actions: November 21, 1978 |accessdate=2007-11-29 |date=1978-11-21 |format=PDF |publisher=Federal Open Market Committee] This proved only a short-term fix; while temporarily steadying the dollar, it soon resumed its fall.cite news |title=The Squeeze of '79 |url=http://www.time.com/time/magazine/article/0,9171,947495-3,00.html |publisher="Time" |date=1979-10-22 |accessdate=2007-11-27 ] The portmanteau "stagflation", the combination of "stagnation" and "inflation", increased in popularity during this time to describe the high rate of inflation that was failing to spur the economy.

Miller's lackadaisical measures against inflation caused distress among members of the Carter Administration itself. Treasury Secretary Blumenthal, Inflation Adviser Alfred Kahn, and Chief Presidential Economist Charles Schultze all advocated for increasing the interest rate prior to the April 1979 meeting, where Miller opposed such measures. Carter had to admonish his own staff over the press leaks used to carry on the dispute.cite news |title=The Fed vs. Jimmy's Aides |url=http://www.time.com/time/magazine/article/0,9171,723928,00.html |publisher="Time" |date=1979-04-30 |accessdate=2007-12-06 ]

Miller was not perceived as having great prestige; not coming from an economics or Wall Street background, he was seen as an "outsider."Belden, Susan. [http://links.jstor.org/sici?sici=0022-2879(198911)21%3A4%3C432%3APPOFMA%3E2.0.CO%3B2-X Policy preferences of FOMC members as revealed by dissenting votes] ] A 2003 article in "The Economist" said that "America's central bankers have all made their weight felt across the political sphere, with the possible exception of William Miller, whose brief tenure in 1978-79 was notable for his attempts to ban smoking at the board." [cite news |title=After Alan |url=http://www.economist.com/world/na/displaystory.cfm?story_id=E1_VDNVGNS |publisher=The Economist |date=2005-08-13 |accessdate=2007-11-16 . The order of the sentence is reversed for clarity here.] It is rare for the influential chair's opinion to not carry the vote at the Federal Reserve's meetings, but Miller was outvoted by the Board of Governors at a meeting in 1979 where he opposed an increase in the discount rate, the rate at which the Federal Reserve lends to banks.

Economic historians have generally considered Miller's short tenure unsuccessful. The high inflation that Miller allowed required harsh "shock therapy" treatment by his successor Paul Volcker to bring under control, which sent the U.S. economy into recession from 1980-1982. Steven Beckner, a Federal Reserve analyst, offered a particularly harsh assessment:

Treasury Secretary

Miller was Fed chairman for just over a year when Carter appointed him Secretary of the Treasury in August 1979, replacing Michael Blumenthal as part of a major cabinet shuffle in which five Cabinet members were replaced.cite news |title=Carter's Great Purge |url=http://www.time.com/time/magazine/article/0,9171,948464,00.html |publisher="Time" |date=1979-07-30 |accessdate=2007-12-06 ] Blumenthal had previously clashed with the administration, and Miller desired his post.fact|date=November 2007 Miller leaked certain unsavory personal details about Blumenthal to Carter, and soon Blumenthal was gone.fact|date=November 2007 Carter appointed Paul Volcker to replace Miller. He thus became the only person to serve as both Treasury Secretary and Chairman of the Federal Reserve. As Treasury Secretary, Miller is best known for his role on the Chrysler Loan Guarantee Board, which oversaw management of a $1.5 billion loan to rescue the carmaker from bankruptcy. This attracted some controversy as the bailout was thought to reward mismanagement and impede fair trade relations between the United States and Japan. Miller agreed that "The administration does not favor, as a general proposition, government aid to private corporations," but thought an exception should be made in Chrysler's case. Chrysler recovered in the early 1980s and paid off the loan early.

Miller is also known for managing the freezing and partial unfreezing of $12 billion in Iranian funds held in the United States during the Iranian hostage crisis. He also pushed through an accord with labor unions on wage-price guidelines that had been "stalemated for months."

Miller's economic policies failed to contain inflation and had little impact on rising unemployment rates. The poor state of the economy was a major factor in Carter's 1980 defeat by Ronald Reagan.

Later years

After Carter's administration ended, Miller founded G. William Miller & Co., a Washington private investment company that he likened to a discreet, Swiss-style merchant bank. He also served positions on a number of charitable and nonprofit organizations. This included treasurer of the American Red Cross, a trustee and director of the Washington Opera, and chairman of the Washington-based H. John Heinz III Center for Science, Economics and the Environment. He also was chairman and chief executive of Federated Stores Inc. (now Macy's, Inc.) from 1990 to 1992.

William Miller died on March 17, 2006 from idiopathic pulmonary fibrosis, a lung condition.

References

* Department of the Treasury Resignation of W. Michael Blumenthal and Nomination of G. William Miller To Be Secretary. July 19, 1979 American Reference Library

External links

* [http://www.ustreas.gov/education/history/secretaries/gwmiller.shtml Secretaries of the Treasury, G. William Miller] - Official profile
* [http://www.federalreserve.gov/monetarypolicy/fomc_historical.htm Minutes and Policy Actions of the Federal Open Market Committee, Historical]