Carter's «populism» was not visible in his administration's relationship to the oil and gas interests. It was part of Carter's "energy plan" to end price regulation of natural gas for the consumer. The largest producer of natural gas was Exxon Corporation, and the largest blocs of private stock in Exxon were owned by the Rockefeller family.

Early in Carter's administration, the Federal Energy Administration found that Gulf Oil Corporation had overstated by $79.1 million its costs for crude oil obtained from foreign affiliates. It then passed on these false costs to consumers. In the summer of 1978 the administration announced that "a compromise" had been made with Gulf Oil in which Gulf agreed to pay back $42.2 million. Gulf informed its stockholders that "the payments will not affect earnings since adequate provision was made in prior years."

The lawyer for the Energy Department who worked out the compromise with Gulf said it had been done to avoid a lengthy and costly lawsuit. Would the lawsuit have cost the $36.9 million dropped in the compromise? Would the government have considered letting off a bank robber without a jail term in return for half the loot? The settlement was a perfect example of what Carter had told a meeting of lawyers during his presidential campaign-that the law was on the side of the rich.

The fundamental facts of maldistribution of wealth in America were clearly not going to be affected by Carter's policies, any more than by previous administrations, whether conservative or liberal. According to Andrew Zimbalist, an American economist writing in Le Monde Diplomatique in 1977, the top 10 percent of the American population had an income thirty times that of the bottom tenth; the top 1 percent of the nation owned 33 percent of the wealth. The richest 5 percent owned 83 percent of the personally owned corporate stock. The one hundred largest corporations (despite the graduated income tax that misled people into thinking the very rich paid at least 50 percent in taxes) paid an average of 26.9 percent in taxes, and the leading oil companies paid 5.8 percent in taxes (Internal Revenue Service figures for 1974). Indeed, 244 individuals who earned over $200,000 paid no taxes.

In 1979, as Carter weakly proposed benefits for the poor, and Congress strongly turned them down, a black woman, Marian Wright Edelman, director of the Children's Defense Fund in Washington, pointed to some facts. One of every seven American children (10 million altogether) had no known regular source of primary health care. One of every three children under seventeen (18 million altogether) had never seen a dentist. In an article on the New York Times op-ed page, she wrote:

The Senate Budget Committee recently… knocked off $88 million from a modest $288 million Administration request to improve the program that screens and treats children's health problems. At the same time the Senate found $725 million to bail out Litton Industries and to hand to the Navy at least two destroyers ordered by the Shah of Iran.

Carter approved tax «reforms» which benefited mainly the corporations. Economist Robert Lekachman, writing in The Nation, noted the sharp increase in corporate profits (44 percent) in the last quarter of 1978 over the previous year's last quarter. He wrote: "Perhaps the President's most outrageous act occurred last November when he signed into law an $ 18 billion tax reduction, the bulk of whose benefits accrue to affluent individuals and corporations."

In 1979, while the poor were taking cuts, the salary of the chairman of Exxon Oil was being raised to $830,000 a year and that of the chairman of Mobil Oil to over a million dollars a year. That year, while Exxon's net income rose 56 percent to more than $4 billion, three thousand small independent gasoline stations went out of business.

Carter made some efforts to hold onto social programs, but this was undermined by his very large military budgets. Presumably, this was to guard against the Soviet Union, but when the Soviet Union invaded Afghanistan in 1979, Carter could take only symbolic actions, like reinstituting the draft, or calling for a boycott of the 1980 Moscow Olympics.

On the other hand, American weaponry was used to support dictatorial regimes battling left-wing rebels abroad. A report by the Carter administration to Congress in 1977 was blunt, saying that "a number of countries with deplorable records of human rights observance are also countries where we have important security and foreign policy interests."

Thus, Carter asked Congress in the spring of 1980 for $5.7 million in credits for the military junta fighting off a peasant rebellion in El Salvador. In the Philippines, after the 1978 National Assembly elections, President Ferdinand Marcos imprisoned ten of the twenty-one losing opposition candidates; many prisoners were tortured, many civilians were killed. Still, Carter urged Congress to give Marcos $300 million in military aid for the next five years.

In Nicaragua, the United States had helped maintain the Somoza dictatorship for decades. Misreading the basic weakness of that regime, and the popularity of the revolution against it, the Carter administration continued its support for Somoza until close to the regime's fall in 1979.

In Iran, toward the end of 1978, the long years of resentment against the Shah's dictatorship culminated in mass demonstrations. On September 8, 1978, hundreds of demonstrators were massacred by the Shah's troops. The next day, according to a UPI dispatch from Teheran, Carter affirmed his support for the Shah:

Troops opened fire on demonstrators against the Shah for the third straight day yesterday and President Jimmy Carter telephoned the royal palace to express support for Shah Mohammad Reza Pahlevi, who faced the worst crisis of his 37-year reign. Nine members of parliament walked out on a speech by Iran 's new premier, shouting that his hands were "stained with blood" in the crackdown on conservative Moslems and other protesters.

On December 13, 1978, Nicholas Gage reported for the New York Times:

The staff of the United States Embassy here has been bolstered by dozens of specialists flown in to back an effort to help the Shah against a growing challenge to his rule according to embassy sources… The new arrivals, according to the embassy sources, include a number of Central Intelligence Agency specialists on Iran, in addition to diplomats and military personnel.

In early 1979, as the crisis in Iran was intensifying, the former chief analyst on Iran for the CIA told New York Times reporter Seymour Hersh that "he and his colleagues knew of the tortures of Iranian dissenters by Savaki, the Iranian secret police set up during the late 1950s by the Shah with help from the CIA." Furthermore, he told Hersh that a senior CIA official was involved in instructing officials in Savaki on torture techniques.

It was a popular, massive revolution, and the Shah fled. The Carter administration later accepted him into the country, presumably for medical treatment, and the anti-American feelings of the revolutionaries reached a high point. On November 4, 1979, the U.S. embassy in Teheran was taken over by student militants who, demanding that the Shah be returned to Iran for punishment, held fifty-two embassy employees hostage.

For the next fourteen months, with the hostages still held in the embassy compound, that issue took the forefront of foreign news in the United States and aroused powerful nationalist feelings, When Carter ordered the Immigration and Naturalization Service to start deportation proceedings against Iranian students who lacked valid visas, the New York Times gave cautious but clear approval. Politicians and the press played into a general hysteria. An Iranian-American girl who was slated to give a high school commencement address was removed from the program. The bumper sticker "Bomb Iran " appeared on autos all over the country.