View original document

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

. Remarks by G. William Miller, Chairman
Board of Governors of the Federal Reserve System at the
U.S. Coast Guard Academy Commencement
New London, Connecticut
May 24, 1978
Admiral Perry, Admiral Clark, distinguished participants
in this graduation, and members of the graduating class, your families
and friends.
I appreciate the generous introduction.

But I've been having

trouble recently because when I am introduced as Chairman of the
Federal Reserve most people immediately raise their eyebrows and
ask, ''What is that?"

I conducted a survey and found that most

Americans think the Federal Reserve is an Indian reservation.


if you will look at your dollar bills and pay careful attention,
you'll see that they are really Federal Reserve notes.

So be nice

to us, because we supply your money.
I'm delighted to address a few words to the class of '78.
I understand you started the day with your flag flying, and I hope
that it will be flying for a long time.

It's a particular privilege

and a special treat for me to stand in this spot today.
ago that I was sitting among the graduating class.

It was 33 years

I've not had the

opportunity to attend an Academy graduation since that time, and yet
I approach this occasion with somewhat the same anticipation and
excitement that I had on that day in 1945.

How well I remember the

exhilaration upon completing, at last, the seemingly long and intense
years, and the thrill of pinning on the gold bars and snapping on the
shoulder boards with those wide gold stripes.



No doubt there will oe disagreement as to who is more turned
on by this graduation.

Apparently when I graduated it was the second

class; they got the biggest thrill.
I must say.

We had a very ef.fective class;

But many will say that the most excitement belongs to the

class of '78, the graduating class, and that's to be expected.


can believe me, whatever rank you obtain there is nothing that will
ever be so rewarding as that commission as an Ensign.
· Others will say that the families and sweethearts who have
also waited so long for this propitious occasion are most excited.
Perhaps some will say it's the second class -- as was the case for
Admiral Clark's class when I graduated.

The second class is about

to become the first class and they are going to take over the cadet
leadership and set everything right again.
But my guess is that it is really the fourth class that's
the most excited.

The Swabs at last will come out from under, and,

boy, what a release that will be.

They arranged the rain because

they're already out celebrating.
Well, may all of you who have waited long and impatiently
for this hour find your true rewards.
My role today, I know, is a great responsibility.

It offers

a moment to reflect about the new life ahead -- before the joys of
celebration with family and friends and before the sadness of farewells
to classmates and faculty.

The test for me is to be brief yet responsive.

When I graduated the address was for 45 minutes.
cut that down.

I'll see if I can


-3When I graduated, the war in Europe had just ended.


departed innnediately for Okinawa and then Japan and began my rather
brief but eventful career in the Coast Guard.

Demobilization carried

many of us back to civilian life, but little did I expect in those
times -- and never did I aspire at any time -- to someday be a banker
certainly not a central banker.

It's clear, however, that the Coast

Guard Academy is good preparation for a wide variety of career

My personal experience bears out the high quality of

the education provided by the Academy's dedicated faculty.
A great deal has changed since 1945; that's to be expected.
But we live in a world of accelerating change.

Political, economic,

technological, and social changes cascade upon us, compelling extraordinary skills and wisdom to navigate a safe societal course.
During your careers you can anticipate


greater magnitudes of

You will be called upon to manage those changes construc-

tively, rather than to become victims of them.
Perhaps before you embark as new Coast Guard officers it
would be well to recall some of the conditions which have prevailed
while you were deciding upon and preparing your careers.
The past dozen years have been characterized by dramatic
shocks and discontinuities.

The war in Vietnam was divisive.


state of domestic tranquility was interrupted by civil disorders.
Failure to pay for that war planted the seeds of inflation.


threat of inflation led to direct wage and price controls which
proved to be both inequitable and ineffective.

The international

-4monetary system broke down.

The U.S. economy was reflated, building

up a head of steam in the kettle.

When the discredited wage and

price controls were removed, the steam blew off and double digit
inflation and double digit interest rates resulted.

To compound

the difficulties, the oil boycott ushered in a 5-fold increase in
world petroleum prices.

The Watergate incident and its aftermath

led to a general distrust of all institutions, public and private.
Finally, there was the great recession of 1975, with 9 percent
unemployment and the greatest economic difficulties since the
depression of the 1930's.
Now we are beginning the fourth year in economic recovery

from those troubled times.

The level of prosperity has advanced

considerably. Social and political co·n ditions have become more

Yet, in the face of progress there is a nagging discomfort.
The reason is not hard to fathom.

issues remains formidable, indeed.

The agenda of unresolved

In the economic field, America's

most serious domestic problem is inflation.

Inflation destroys

values and incomes, dries up job-creating investments, impairs the
prospect for new housing and other construction, and breeds recessions.
Perhaps the best way to illustrate the clear and present
danger of inflation is to consider the consequences for today's

If inflation should be permitted to continue at a

6 percent rate -- and this year we can expect a 7 percent rate
but even at 6 percent, by the time you reach age 65, the dollar you
have in your pocket now will be worth less than 10 cents.

-5We cannot let that happen to you.

We cannot let that

happen to America or to the World.
For you who are devoted to Coast Guard service, my highlighting inflation may seem remote and not relevant to your concerns,
but it should be of a critical concern.
Guard are varied and demanding.

The missions of the Coast

Your ability to accomplish those

missions is greatly affected by the condition of the community at



If that connnunity, national or global, is in a state of

political jnstability and economic distress, your task will become




more difficult, if not impossible.

The resources available to you

will be more limited than needed to get the job done.

That is why

you, as citizens who have elected to serve your countrY, have a special
reason to be concerned.
In my own case, I have now


called back to national

In my new role I must deal with monetary policy and its

interrelationship with other economic policies, in furtherance of
a total commitment to attain our country's goals of full employment
with price stability and with a sound and stable dollar.
conditions are required in order to have a tranquil world.


well-being is essential for lasting peace.
This Academy provided me with invaluable resources tc
meet all the challenges I have ever faced.

The Coast Guard also

guided me in my destiny by sending me to Shanghai, China, where I
met my wife Ariadna.

So I have a great deal to be thankful for about

my own experience as a cadet, as a graduate, and as a Coast Guard officer.


-6Let me note some of the Academy resources which I cherish.
One is discipline.

It was a hard shock as a youn$ster to face the

disciplines of the Academy, but I benefited greatly because it taught
me to use my resources and my talents for a purpose and to organize
myself in a balanced. way to accomplish my goals.

The Academy taught

me preparedness -- Semper Paratus -- and how often I have benefited
by thinking ahead and being ready for the event when it occurred.
It taught me professionalism.

It taught me the merit of finding

out the real facts and of approaching a problem with an objective
viewpoint and a professional attitude.

It taught me loyalty, not

only to my country but to all of the people with whom I serve, and
the importance of working with them as a team.

No one alone can

accomplish the tasks in life, and loyalty to an organization develops
that kind of teamwork that is essential to achieving the greatest.
It taught me responsibility.

When ·! graduated, I was just over 20

years old, and before age 21 I had the experience of command, which
is an opportunity rarely obtained.

That kind of responsibility


matured me and prepared me for the kind of changing world that I
have experienced over the years.

It taught me service, and a

commitment beyond the Coast Guard to the larger world, a commitment
to humanity.

And it taught me hu:nanity, a sense of fairness and

equity, a sense of fair play, a s~nse that everyone has a right to
achieve his best.

Above all, it taught me excellence, the quest for

quality, for superior performance.

It taught me to achieve the best.

that I could, and many more things which you know well.



. -

-7I'm proud of the


Guard, I'm proud of the Academy,

and I am proud of each of you in the Class of '78 and your chosen

It is a great calling.

You have been selected through

years of difficult testing, and you have achieved this final
confirmation of your qualifications.
be going into.

It is a great Service you will

Your personal service is needed;

humanity will

benefit from it.
I wish that each of you will always have fair weather
and a following wind.

' i