Set Up to Fail: The Overmatched Jimmy Carter

On the occasion of Jimmy Carter's death, an excerpt from 'American Exception: Empire and the Deep State' (2022) taken from Chapter 8: "Triumph of the Deep State"

In 1977, Jimmy Carter was sworn in as the 39th President of the United States. Carter’s improbable rise can be attributed largely to his association with David Rockefeller’s Trilateral Commission. In 1973, Carter was selected by leading establishment figures who wanted a southern Democrat to join the new organization. Carter was selected over Florida governor Reuben Askew because, according to Zbigniew Brzezinski, Carter “had opened trade offices for the state of Georgia in Brussels and Tokyo [which] seemed to fit perfectly in the concept of the Trilateral.”¹ The Carter campaign followed the advice of Trilateral figures who would go on to hold important positions in his administration. As far back as 1973, Brzezinski had argued that the Democratic nominee in 1976 would need to “emphasize work, the family, religion, and, increasingly, patriotism, if he has any desire to be elected.”² Samuel Huntington wrote in the Trilateral Commission tome, The Crisis of Democracy, that “the ‘outsider’ in politics, or the candidate who could make himself or herself appear to be an outsider, had the inside road to political office.”³

While this accounts for Carter’s strategy, it does not explain his meteoric rise. For this, the establishment press must be given considerable credit. As late as late January 1976, Carter was the favorite of only 4 percent of voters, according to a Gallup Poll. By the second week of March, he was only one percent behind the leading candidate, Hubert Humphrey. Only very favorable media coverage could account for such an historically unprecedented rise. In mid-January 1976, national media figures like Joseph Kraft and Tom Wicker noted that Carter was, as Kraft put it, “the media candidate for the Democratic presidential nomination.”⁴ It helped that the national media largely omitted reference to Carter’s overworld sponsors. According to Project Censored, the “virtual blackout of information available to the public through the mass media concerning the relationships between Jimmy Carter, David Rockefeller, and the Trilateral Commission” qualified it as “the best-censored news story of 1976.”⁵

Few commentators remarked upon the contradiction between Carter’s elitist backing and the media image of him as a “moral” “political outsider.” One notable exception in the media was Christopher Lydon who, in 1977, wrote that there were some clues that Carter was in effect a Rockefeller Republican:

One was Time magazine, which gave Carter early prominence with a flattering cover portrait in 1971. Through 1975, Time’s advertising in other magazines for its own campaign coverage looked more like an ad for Jimmy Carter: a half-page picture presented the candidate in a Kennedyesque rocking chair under the caption: “His basic strategy consists of handshaking and street-cornering his way into familiarity.” Through 1976 and into 1977, Time’s hagiographers were hard to separate from the Carter promotional staff. [. . .] I couldn’t remember the weekly news magazine extending itself that way in the past except for the more eastern and international (or Rockefeller) wing of the Republican party—for Willkie in 1940, Eisenhower in 1952, and Scranton in 1964.⁶

About the Trilateral Commission Lydon observed that,

[It] was David Rockefeller’s brain child, a somewhat more energetic young cousin of the elite Bilderberg Conferences [. . .] The commission was conceived in 1972 as a private vehicle for planning the industrial world’s course out of the international monetary crisis [and] into a new stability of banking relationships among the First World and of trading agreements with the Third World. [P]resumably the much greater value of [Carter’s] Trilateral membership was the private reassurance it conveyed that David Rockefeller had deemed him a promising student and had gotten his education under way. The Trilateral Commission’s executive director, Zbigniew Brzezinski, became quite literally Jimmy Carter’s tutor, and now, of course, directs the White House foreign policy staff, as Henry Kissinger did in the first Nixon term. How could [Rockefeller] have guessed that his Trilateralists would staff all major policy posts in the new government—including, as if by a miracle, the vice presidency and the presidency?⁷

What Lydon could not have surmised was that the Carter presidency was not a one-off event. The Democratic Party—in the aftermath of the Bretton Woods collapse and of Watergate—had been realigned by overworld forces in such a way as to render it a neoliberal-dominated party in mild opposition to the neoconservative-dominated Republican Party that was poised to deliver the “Reagan Revolution.” The vaguely progressive, New Deal wing of the Democratic Party was consigned to a political wilderness from which it has not returned.

As president, Carter tried to put a greater emphasis on human rights and on a more moral foreign policy. Taking office in the wake of the “Year of Intelligence” and with the HSCA just convening, Carter sought to reign in the intelligence community. He fired George Bush as DCI and replaced him with Stansfield Turner, an admiral who graduated from the naval academy with Carter. Turner would eventually fire important deep state operatives at the CIA, “old boys” who he thought were roadblocks to reform. Among the fired officers were Ted Shackley, Ray Clines, and Ed Wilson. This would have some notable consequences.

Ultimately, Carter’s presidency was undone by deep political forces. Like Kennedy and Nixon, Carter could not reconcile his political position with the accommodations demanded by the neoconservatives or even the neoliberals like his Trilateral patrons. It wasn’t that Carter chose to spurn these constituencies. To the contrary, Carter pursued Reaganism before Reagan. This was in accordance with the post-Watergate rolling political coup that realigned both parties further to the right by making the GOP the party of Reagan and essentially transforming the Democrats into the party of rebranded Rockefeller Republicans. Deregulation, which began modestly under Ford, accelerated under Carter as the trucking, airline, and train industries were deregulated. Regarding banking and finance, Canova summarizes:

[T]he similarities between the Carter and Reagan administrations far outweigh the differences. Both presidents accepted basic free-market premises that were often at odds with market realities. The result was a bipartisan dismantling of the New Deal regulatory regime in banking and finance and a relaxation of the regulatory discipline that had contained market interest rates during the period after World War II.⁸

This is to say that under Carter, the US ushered in the age of Federal Reserve–centered monetarist hegemony and financial deregulation. The latter was most notably accomplished by Carter’s signing of the Depository Institutions Deregulation and Monetary Control Act of 1980 (DIDMCA). This act increased insurance of deposits from $40,000 to $100,000, removed restrictions on thrift institutions (thus beginning the deregulation of savings and loan associations), and called for gradual elimination of interest rate caps on deposit accounts.⁹ The former transpired with Carter’s selection of Paul Volcker to chair the Federal Reserve.

The massive interest rate hike (a.k.a., the Volcker shock) was another key deep state stratagem that served to strengthen US dominance after what seemed on the surface to be setbacks in the wake of Vietnam, the oil shocks, and Watergate. Again, the democratic state was suborned to the will of deep political power. Deep political forces and the Nixon administration worked in concert to create the OPEC oil shocks as a way to deal with the dollar overhang created by Vietnam War spending. Excess dollars went to oil producers’ central banks and from there into US treasury bills and into US banks. Massive loans were then made to the countries of the Global South. This set the stage for the Volcker shock. With US Fed’s huge interest rate hikes, excess dollars further flowed back to the US and developing countries became unable to service their debts. As Yanis Varoufakis summarizes,

While [the Volcker shock’s] did tame inflation, its harmful effects on employment and capital accumulation were profound, both domestically and internationally. [. . .] A new phase thus began. The United States could now run an increasing trade deficit with impunity, while the new Reagan administration could also finance its hugely expanded defense budget and its gigantic tax cuts for the richest Americans. The 1980s ideology of supply-side economics, the fabled trickle-down effect, the reckless tax cuts, the dominance of greed as a form of virtue, etc.—all these were just manifestations of America’s new ‘exorbitant privilege’: the opportunity to expand its twin deficits almost without limit, courtesy of the capital inflows from the rest of the world. American hegemony had taken a new turn.¹⁰

This “new turn” in American hegemony, realized early in Reagan’s presidency, represents the consolidation of the deep state system, i.e., of deep state dominance over the public state and the security state.

Later in his presidency, Carter also pursued policies agreeable to neoconservatives. After previously calling for $5–7 billion in military spending cuts, Carter in 1980 urged Congress to begin increasing the Pentagon budget to the tune of $100 billion over the following five years. Said Carter at the time, “Our forces must be increased if they are to contain Soviet aggression.” He argued at the time that the budget proposals would “meet the increased threat resulting from events in Afghanistan.”¹¹ Notably, it was a Carter policy that had served to provoke the 1979 Soviet invasion of Afghanistan in the first place. At the time, the Soviets justified the invasion in part by asserting that they were fighting against enemies secretly funded by US operations. Though US officials denied this at the time, the accusation was confirmed years later in a memoir by Robert Gates.¹² In 1998, additional confirmation came from Carter’s National Security Adviser himself, Zbigniew Brzezinski, who told an interviewer:

According to the official version of history, CIA aid to the Mujahiddin began during 1980, that is to say, after the Soviet army invaded Afghanistan on December 24, 1979. But the reality, secretly guarded until now, is completely otherwise: Indeed, it was July 3, 1979 that President Carter signed the first directive for secret aid to the opponents of the pro-Soviet regime in Kabul. And that very day, I wrote a note to the president in which I explained to him that in my opinion this aid was going to induce a Soviet military intervention.¹³

The US-induced Soviet invasion served to justify another of Carter’s gifts to US militarists, the so-called “Carter Doctrine” wherein the president declared that any threat to US interests in the Persian Gulf would be met with military force.

Eventually for Carter, as with Kennedy and Nixon, deep political forces would prove his undoing. His focus on human rights was perceived by Establishment imperialists as having led to the fall of two client regimes in Nicaragua and Iran. His much sought-after Salt II treaty never made it through the Senate despite Carter’s various concessions like DIDMCA and the military spending hikes. The Camp David accords earned Carter the antipathy of Israelis and Saudis alike, harming Carter with powerful domestic constituencies like CIA Arabists and AIPAC’s friends and beneficiaries in Congress. Elements of both the CIA and Israel were in alliance with Republican operatives working to defeat Carter by delaying the release of the hostages.¹⁴ The hostage crisis itself only came about because Carter had bowed to a Rockefeller overworld crusade to pressure Carter into allowing the ailing Shah to come to the United States. Rockefeller financed and organized “Project Alpha,” the code name given to the lobbying campaign for the Shah. Sensing the perilousness of such a course, Carter tried to resist. Prior to a meeting with Rockefeller, Carter wrote in his diary that the purpose for the meeting was “to try to induce me to let the Shah come into our country. Rockefeller, Kissinger, and Brzezinski seem to be adopting this as a joint project.”¹⁵ After months spent resisting the lobby, Carter snapped at Brzezinski and Vice President Mondale, cutting them short with the words, “Fuck the Shah. I’m not going to welcome him here when he has other places to go where he’ll be safe.”¹⁶ Carter finally relented following the defection of the last of his key advisors, Cyrus Vance, to the Project Alpha side. After reluctantly agreeing to admit the Shah, the president turned to everyone in attendance and prophetically asked, “What are you guys going to advise me to do if they overrun our embassy and take our people hostage?”¹⁷

Not even Carter’s disastrous acquiescence to his former patron could cement his support from the Rockefeller overworld. Despite Carter agreeing to admit the Shah into the US, David Rockefeller criticized Carter to the World Affairs Council in June of 1980, saying that Carter had subordinated America’s “vital interests” by privileging “worthy but fuzzily defined moral issues—such as human rights and the proliferation of nuclear technologies.” Pressing the cause of human rights may be “only proper” for the US, but “it should be prudent since our interference may be capable of toppling regimes whose substitutes are unknown.”¹⁸ Three months later, Rockefeller and Project Alpha veteran Joseph Reed went to Arlington to see Bill Casey at his Reagan campaign headquarters. At the time, Carter was making progress toward resolving the hostage crisis. Indications are that Rockefeller was meeting with Casey to forestall an “October Surprise”—the dramatic release of the hostages which might rescue Carter’s presidency on the eve of the election. That the Rockefeller-Reed visit was October Surprise–related received confirmation in the form of sworn testimony from CIA officer Charles Cogan. Cogan was present when Reed visited William Casey early in 1981 and reportedly made remarks about how “we did something about Carter’s October Surprise.” In a less official setting, Cogan explained to an investigator that Reed’s words to Casey were, “We fucked Carter’s October Surprise.”¹⁹

It was the summer of 2019 when the above passages were written—the material on the Rockefeller-Reagan campaign operation to sabotage Carter’s “October Surprise” plan to secure the pre-election release of the hostages in Iran. This particular conspiracy theory received further corroboration in a December 2019 New York Times article which reported that “a newly disclosed secret history from the offices of Mr. Rockefeller” reveals how Rockefeller and his agents “worked behind the scenes to persuade the Carter administration to admit the shah, one of the bank’s most profitable clients.”²⁰ The report on the lobbying campaign confirms the previous investigatory works of people cited above like Robert Parry, Kai Bird, and Peter Dale Scott—though the Times article calls it Project Eagle instead of Project Alpha. The more explosive aspect of the story is contained at the end of the article and is disappointingly if unsurprisingly not further explored or given deeper context. Specifically, the article states,

The hostage crisis doomed Mr. Carter’s presidency. And the team around Mr. Rockefeller, a lifelong Republican with a dim view of Mr. Carter’s dovish foreign policy, collaborated closely with the Reagan campaign in its efforts to pre-empt and discourage what it derisively labeled an “October surprise” — a pre-election release of the American hostages, the papers show. The Chase team helped the Reagan campaign gather and spread rumors about possible payoffs to win the release, a propaganda effort that Carter administration officials have said impeded talks to free the captives. “I had given my all” to thwarting any effort by the Carter officials “to pull off the long-suspected ‘October surprise,’” Mr. Reed wrote in a letter to his family after the election, apparently referring to the Chase effort to track and discourage a hostage release deal. He was later named Mr. Reagan’s ambassador to Morocco.²¹

Of course, Reagan’s “October Countersurprise” plot involved much more than a whisper campaign. As detailed [later in the book], the operation also included key deep state and intelligence figures like George H. W. Bush, Ted Shackley, and Robert Gates.²² It remains one of the most well-documented state crimes against democracy. Its unadjudicated status, in the face of so much evidence, renders it emblematic of America’s long global imperialist era—an epoch characterized by democratic decline and deep state dominance.

1. Laurence H. Shoup, “Jimmy Carter and the Trilateralists: Presidential Roots,” in Trilateralism: The Trilateral Commission and Elite Planning for World Management (Boston, MA: South End Press, 1980), 201.

2. Shoup, “Jimmy Carter and the Trilateralists: Presidential Roots,” 203.

3. Michel Crozier, Samuel P. Huntington, and Joji Watanuki, The Crisis of Democracy: Report on the Governability of Democracies to the Trilateral Commission (New York, NY: New York University Press, 1975), 96; Shoup, “Jimmy Carter and the Trilateralists: Presidential Roots,” 203.

4. Shoup, “Jimmy Carter and the Trilateralists: Presidential Roots,” 206–207.

5. “#1: Jimmy Carter and the Trilateral Commission,” Project Censored, July 8, 2015, https://www.projectcensored.org/1-jimmy-carter-and-the-trilateral-commission/; Noam Chomsky, Radical Priorities, ed. Carlos-Peregrine Otero, 3rd ed. (Oakland, CA: AK Press, 2003) 136–137.

6. Christopher Lydon, “Jimmy Carter Revealed: Rockefeller Republican,” The Atlantic, July 1977, https://www.theatlantic.com/magazine/archive/1977/07/jimmy-carter-revealed-rockefeller-republican/404908/.

7. Lydon, “Jimmy Carter Revealed: Rockefeller Republican.”

8. Timothy A. Canova, “The Transformation of U.S. Banking and Finance: From Regulated Competition to Free-Market Receivership,” Brooklyn Law Review 60, no. 4 (1995), 1309, https://core.ac.uk/download/pdf/228616171.pdf.

9. Michael Sherman, “A Short History of Financial Deregulation in the United States,” Center for Economic and Policy Research: Reports, July 2009, 1, http://cepr.net/documents/publications/dereg-timeline-2009-07.pdf.

10. Yanis Varoufakis, The Global Minotaur: America, Europe and the Future of the Global Economy, 2nd ed. (London, England: Zed Books, 2015), 99.

11. George C. Wilson, “Carter Is Converted To a Big Spender On Defense Projects,” Washington Post, January 29, 1980, https://www.washingtonpost.com/archive/politics/1980/01/29/carter-is-converted-to-a-big-spender-on-defense-projects/6a04fed3-ca48-433e-a972-cca13bdf83a0/.

12. Robert M. Gates, From the Shadows: The Ultimate Insider’s Story of Five Presidents and How They Won the Cold War (New York, NY: Simon & Schuster, 1996), 143–149.

13. Jeffrey St. Clair and Alexander Cockburn, “How Jimmy Carter and I Started the Mujahideen,” Counterpunch, January 15, 1998, https://www.counterpunch.org/1998/01/15/how-jimmy-carter-and-i-started-the-mujahideen/.

14. Peter Dale Scott, The Road to 9/11: Wealth, Empire, and the Future of America (Berkeley, CA: University of California Press, 2007), 90.

15. Kai Bird, The Chairman: John J. McCloy & The Making of the American Establishment (New York, NY: Simon & Schuster, 1992), 644–645.

16. Bird, The Chairman: John J. McCloy & The Making of the American Establishment, 648.

17. Bird, The Chairman: John J. McCloy & The Making of the American Establishment, 652.

18. Scott, The Road to 9/11: Wealth, Empire, and the Future of America, 90.

19. Scott, The Road to 9/11: Wealth, Empire, and the Future of America, 91.

20. David D. Kirkpatrick, “How a Chase Bank Chairman Helped the Deposed Shah of Iran Enter the U.S.,” New York Times, December 29, 2019, https://www.nytimes.com/2019/12/29/world/middleeast/shah-iran-chase-papers.html.

21. Kirkpatrick, “How a Chase Bank Chairman Helped the Deposed Shah of Iran Enter the U.S.”

22. Robert Parry, “Clouds Over George Bush,” Consortium News, December 29, 1998, https://www.consortiumnews.com/1990s/c122898a.html.