When Volcker Ruled

In the late 1970s, the national mood was dark. In the words of President Carter, Americans faced a "crisis of confidence." Inflation reached double digits. Stagflation entered the lexicon. An OPEC price increase led to an energy crisis. And there was the Iran hostage fiasco of 1979. As his presidency strained to regain its footing, Carter made an appointment that would leave a lasting mark on history. He picked Paul Volcker to lead the Federal Reserve. Volcker took up his new post by taking a sledgehammer to inflation, sending interest rates soaring above 20 percent and tipping the economy into recession in the election year of 1980. Volcker's policies loom large today as Federal Reserve chairman Jay Powell struggles to curb the worst inflation since the early 1980s. In this episode, economist and Volcker biographer William Silber talks about the towering legacy of the Federal Reserve chairman, as well as the historical lessons Powell might heed.