Paul McCracken, former chairman of the Council of Economic Advisers under President Richard Nixon and University Professor Emeritus of business administration, died in Ann Arbor at the age of 96 on Friday.
Upon graduating from William Penn University, McCracken took a position teaching English at Berea College in Kentucky. After obtaining a master’s degree in economics from Harvard University, he joined the Department of Commerce in 1943 where he made the prediction that would put him on the economic map.
While most economists believed the post-World War II economy would revert back to Depression-era conditions in a process known as “secular stagnation,” McCracken went against the grain, predicting a surge in economic growth that turned out to be true, according to Sidney Jones, a colleague of McCracken in both the Nixon administration’s Council of Economic Advisers and the Ross School of Business.
“McCracken, as a remarkable young man, made this correct forecast, and it really made his reputation,” Jones said.
McCracken — an Edmund Ezra Day Distinguished University Professor Emeritus — came to the University in 1947 where he taught in the Business School while also holding positions in Washington D.C., serving Presidents Eisenhower, Kennedy, Johnson, Nixon and Ford in a range of capacities.
With his jobs in government service, a doctorate in economics and a past that included business consulting work for companies such as Dow Chemical and General Motors, McCracken implemented his varied experiences in the classroom.
“He really had these three legs to the stool, so when he would talk to students he could tell them practical things,” Jones said of McCracken’s teaching method.
Former colleagues and students also lauded McCracken’s passion for teaching. Herb Hildebrandt, University Professor Emeritus and long-time friend and coworker of McCracken’s, said McCracken would always make time to connect to students and faculty even after retiring from the Business School.
“In his early nineties, he would sit after lunch … in the main room of the Business School and whoever came by — students, faculty — he would speak with. He did that for years,” Hildebrandt said.
Hildebrandt added that McCracken initially came to the University for the scholarly opportunities and the desire to teach the principles of economics and business to students. McCracken was a fixture at the Business School until his death, receiving eight honorary degrees in his lifetime, according to the University News Service.
Though McCracken was a member of the Business School faculty, he was primarily an economist, specializing in “business, international, national and world economics,” Hildebrandt said. However, Hildebrandt added that due to conflict between the Business School and the economics department, McCracken was never a member of the economics department at the University.
Hildebrandt told the News Service that one of his fondest memories of McCracken was his strong emphasis on ethics.
“Paul lived a life of ethical elegance,” he said. “He stubbornly believed that a fitting coda to one’s life should be that ethics and morality should walk hand in hand with whatever one does. He taught me many things, but most importantly, he taught me humility.”
Though McCracken considered himself a moderate Republican, he believed the government should take an active role in the business world, both in terms of regulation and granting aid to the unemployed, according to The New York Times.
McCracken based his model of employing a strong governmental role in the economy after economist Milton Friedman of the University of Chicago Department of Economics, according to the News Service.
In 1995, Friedman said McCracken’s work transcended economics, adding that he was a great academic who influenced both sides of the political spectrum.
“Paul McCracken has earned a deservedly high reputation in three different worlds: the academic, the governmental and the business … few academics have achieved so wide a range of influence,” Friedman said.
But McCracken was also influenced by the Keynesian school of thought as a result of studying under Alvin Hansen at Harvard, who was known as “The American Keynes.”
“He combined the two schools, the Keynesianism and the (Chicago School) Monetarism, and it made him really quite unique,” Jones said. “Most economists of that era would be either a Keynesian … or they’d be a monetarist … but McCracken had both capabilities, and that made him quite unusual.”
During the 1960s and ’70s McCracken attempted, albeit unsuccessfully, to curb inflation, according to the Times.
“Government was never during the 1970s able to bring itself to meet the first fundamental requirement of a successful price-stabilization policy — namely, that its policies, quite simply, would not accommodate inflation,” McCracken told the Times in 1980.
After serving presidents Kennedy and Johnson, McCracken was asked by president-elect Nixon to serve as chief economic adviser.
McCracken and Nixon disagreed over the use of wage and price controls, in seeking to stop inflation, and this tension led to McCracken’s resignation from the economic council in 1971. According to Jones, though McCracken opposed wage and price controls, which were declared on Aug. 15, 1971, he refused to speak out and didn’t resign until December of that year because of loyalty.
“I thought that was a very gentlemanly thing to do, a very classy thing to do,” Jones said. “That was very typical of what Paul McCracken is.”
Despite leaving the council, he continued to advise organizations including the Academic Advisory Board for the American Enterprise Institute for Public Policy Research, according to the News Service.
Business Prof. Alison Davis-Blake said in a statement that McCracken will be remembered for his commitment to quality education in addition to his economic accomplishments.
“I loved seeing Paul frequent our building, long past his ‘retirement.’ ” Davis-Blake said. “He set a wonderful example for our current faculty and students and is a testament to the enduring legacy of education.”
McCracken is survived by his two daughters, Linda Langer and Paula McCracken.
–The Associated Press contributed to this report.