President Jimmy Carter shakes hands with Paul Volcker, left, as he is sworn in as Fed chairman, Aug. 6, 1979, at the White House.
Paul Volcker, who died Sunday at the age of 92, will be remembered as the Federal Reserve chairman who beat inflation down as it galloped at nearly 15% during the final year of Jimmy Carter’s presidency.
In an oral history with the Fed, Volcker explained “why I probably don’t like inflation.” It was 1945. He was 18 at the time, going off to college at Princeton.
“My mother said, ‘We’ll give you an allowance of $25 a month.’
“I said, ‘That’s not enough. I’m a boy. I need more than that.’
“My mother said, ‘That’s what your sisters got, and that’s what you’re going to get.’
“I said, ‘My sisters don’t need as much money. Ruth went to college in the middle of the Great Depression, and so did Louise. And we’ve had inflation, Mother. I need more.’
“She said, ‘I don’t care.’
“So I wrote a letter to all my sisters and asked whether they felt it appropriate that I get more. And they did, given inflation. They all wrote back dutifully to my mother. They agreed that I should be entitled to more money.
“My mother said, ‘I don’t care about all that. You’re going to get $25, just like what your sisters got.'”