The Strengths And Weaknesses Of Coalition Government Politics ..
587 Words Essay on politics of coalition government (India)
Nixon was not yet prepared to institute a wage-prize freeze or make the transition to a government board to recommend caps on wage and price increase, partly because of strong divisions within his administration over taking those steps. But the Business Council decided that it did not want to wait any longer for action. In a meeting at the White House with Nixon in May, the president of a major corporation of that era, Cummins Engine "espoused the immediate adoption of temporary wage and price controls." Then the Business Council as a whole took "the unprecedented step of taking a straw vote on the issue, subsequently conveying to the president an expression of discontent at the administration's failure to secure smaller wage and price increases" (Marchi 1975, p. 340). Strikes in several different industries in the summer of 1971, which resulted in major wage hikes, including a 30% wage increase over a three-year period for the United Steel Workers, finally forced Nixon's hand (Matusow 1998, p. 110).
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Faced with these criticisms, Nixon nonetheless tried to maintain a gradualist policy for dealing with inflation to avoid alienating the union leaders that supported his Vietnam policies. But with the inflation rate averaging 18% for the first year of new government construction contracts, he asked the members of the Construction Industry Collective Bargaining Commission in mid-January 1971 to come up with a plan for dealing with inflation within 30 days. When the business executives and labor leaders on the commission could not agree to a plan. Nixon then turned to the remedy favored by the Construction Users Anti-Inflation Roundtable, a suspension of the Davis-Bacon Act in February 1971. The suspension ended a month later with the trade unions agreeing to a new Construction Industry Stabilization Committee, "whose task it was to abate wage increases to something like the rate that had prevailed from 1961 to 1968" (Marchi 1975, p. 332). All settlements would have to be approved first by craft-level dispute boards and then by the new industry stabilization committee.