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When Georgia governor James Earl “Jimmy” Carter announced that he would run for president, he was virtually unknown outside his home state. But after a 2-year campaign during which he cultivated a reputation as a Washington outsider, Carter won the 1976 presidential election with 50.1% of the popular vote, edging out the Republican incumbent Gerald Ford. During his tumultuous one term in office, Carter's outsider credentials evaporated. Democrats were disappointed by his compromises and his moralistic tone. Republicans found Carter to be a convenient scapegoat for the economic and foreign policy setbacks of the late 1970s.

During his campaign, Carter took advantage of his political strengths. As a Southerner, he portrayed himself as a simple peanut farmer and born-again Baptist. In 1976, he won the electoral votes of every southern state except Virginia. To sway voters outside the South, Carter emphasized his governorship, which reversed the segregationist tradition of former Georgia governor Lester Maddox. Trained at the U.S. Naval Academy as a nuclear power engineer, Carter described himself as a pragmatic problem-solver. He impressed journalists, even jaded reporters such as Rolling Stone's Hunter S. Thompson, with his ability to speak eloquently about the theology of Reinhold Neibuhr and the lyrics of Bob Dylan. Most effectively, Carter convinced voters of his plainspoken honesty, a trait very much in demand following the resignation of President Nixon in 1974 and his subsequent pardon from Gerald Ford.

Carter won with the backing of a coalition of social groups that had supported Democrats since the era of Franklin D. Roosevelt: southern Democrats, African Americans and ethnic minorities, urban voters in cities run by Democratic machines, and working-class voters who distrusted the anti-union Republican Party. After two terms of Republican presidents, many of these groups expected Carter to reanimate the Great Society reforms of the Johnson-Kennedy years. But Jimmy Carter's term proved to be a disappointment.

Carter envisioned the presidency as an office of moral leadership that should rise above the horse-trading of interest-group politics. He also strove to make the federal government more efficient and cost-conscious. So when a crisis erupted during his first months in the White House—a shortage of home heating oil during a bitterly cold winter—Carter responded with a plan that aggravated Americans of all political persuasions. One part of the plan called for removing price controls on fuel in order to encourage conservation. Critics on the left assailed price deregulation as a regressive policy that harmed poor families the most. Thinking like an engineer focused on comprehensive solutions, Carter created a cabinet-level Energy Department, which critics on the right detested as a wasteful expansion of government. The energy crisis also created one of the enduring images of Jimmy Carter in the public mind: wearing a cardigan sweater in the Oval Office and urging national television viewers to turn down their thermostats.

The energy crisis persisted throughout Carter's term, and it was part of a larger economic malaise that Carter could not remedy. Unemployment and inflation began their upward spiral in the early 1970s and by 1980 added up to over 20%, a benchmark economists began calling the Misery Index. Simultaneously high rates of unemployment and inflation defied Keynesian economic theory, which held that the two rates should always move in opposite directions. As a result, Carter began slowly to embrace monetary theory as a way to cure the ailing economy. Many of the policies later championed by Ronald Reagan, such as deregulation of industries and raising interest rates to bring down prices, were Carter initiatives. As such, Carter's policies disillusioned many core Democrat voters who felt he had abandoned the party's traditional method of stimulating the economy through government spending.

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