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Charles Zwick, 91, helped engineer 1969 federal surplus

  • NEW YORK TIMES

    Charles J. Zwick, who as President Lyndon B. Johnson’s last budget director, created a $3.2 billion surplus for the fiscal year ending June 30, 1969. It was the only surplus generated by the federal budget from 1960, the last full year of the Eisenhower administration, to 1998, under President Bill Clinton.

Charles J. Zwick, who as President Lyndon B. Johnson’s last budget director helped engineer the only federal surplus posted within a span of nearly four decades, died Friday at his home in Coral Gables, Fla. He was 91.

The cause was cancer, his wife, Barbara, said.

In 1968 Zwick faced a clamor among congressional conservatives for cutbacks in Great Society social-welfare programs. But he also had to contend with Johnson’s demands to safeguard that agenda and relieve the continuing budgetary pressures imposed by the Vietnam War.

Zwick managed to reconcile these competing forces with an income tax surcharge.

“When you couldn’t support both guns and butter without an increase in taxes, then you were in trouble,” Zwick said in 1968 in an interview for the Lyndon B. Johnson Presidential Library.

The president had originally asked for a 6 percent tax surcharge. Congress wanted a $6 billion spending cut. When Johnson’s final budget was passed, he got a 10 percent surcharge, while Congress managed to pare domestic programs by only $4 billion.

Fueled by a booming economy, the surcharge resulted in a $3.2 billion surplus for the fiscal year ending June 30, 1969, by which time Richard M. Nixon was in the White House. It was the only surplus generated by the federal budget from 1960, the last full year of the Eisenhower administration, to 1998, under President Bill Clinton.

“It was not cutting expenditures,” Zwick recalled in 2000 in an oral history interview with the University of Florida history department. “It was growing revenues that really balanced the budget.”

Zwick’s assistant budget director, Peter A. Lewis, also gave credit for the surplus to what he described as Johnson’s uncomplicated formula for bankrolling federal disbursements.

“Rather than closing this or that loophole,” Lewis said in a telephone interview, “at the end of your tax form, you just added 10 percent.”

Zwick was director of the Bureau of the Budget (now the White House Office of Management and Budget) for a year, until Johnson left office in January 1969. He was then chairman and chief executive of Southeast Banking Corp. in Florida until 1991, when he resigned after the company recorded losses in real estate.

In 2010 Zwick gave $1 million to the University of Connecticut to finance expansion of the renamed Charles J. Zwick Center for Food and Resource Policy.

In 2011 he donated $1 million to the RAND Corp. to establish the Zwick Impact Fund, which has studied autonomous vehicle safety, the benefits of educating prison inmates, the prevention of hazing in the military and the cost of caring for patients with dementia.

Zwick enlisted in the Army and served in Japan after World War II, then completed his bachelor’s and master’s degrees in agricultural economics in 1950 and 1951 at the University of Connecticut. He later earned a doctorate in economics from Harvard.

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