The Lies of Alan Greenspan
William Grieder has the definitive, must read takedown of former Fed Chair's recent revisionist history/book tour. Grieder writes in The Nation:
"Alan Greenspan has come back from the tomb of history to correct the record:
-He did not make any mistakes in his eighteen-year tenure as Federal Reserve chairman.
-He did not endorse the regressive Bush tax cuts of 2001 that pumped up the federal deficits and aggravated inequalities.
-He did not cause the housing bubble that is now in collapse.
-He did not ignore the stock market bubble that subsequently melted away and cost investors $6 trillion.
-He did not say the Iraq War is "largely about oil."
Check the record. These are all lies."
Wow.
Go read the full post . . .
Source:
The Lies of Alan Greenspan
WILLIAM GREIDER
BLOG | Posted 09/17/2007 @ 11:13am
http://www.thenation.com/blogs/notion?pid=233482
Wednesday, September 19, 2007 | 08:30 AM | Permalink
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In the dumbness sweepstakes, AG makes a move to pull in front of OJ...
Posted by: wally | Sep 19, 2007 8:35:35 AM
Much like a baseball manager, the Fed. chief always gets too much credit and too much grief from the gallery. That said... The Nation and David Corn are poor examples of solid journalism. Their far-left hysteria renders any article unreadable.
~~~
BR: I am not a reader of the Nation, but I remember Willaim Grieder from his Rolling Stones days -- I used to liked the mag when it was him and Hunter S. Thompson covering national affairs.
Regardless, his criticism remains quite valid.
Posted by: matt m. | Sep 19, 2007 8:54:15 AM
Barry, your quote made Business Week. Couldn't of said it better myself!
The Fed: 'Wall Street's Bitch'
The deeper than anticipated rate cut launched bloggers into feats of rhetorical gymnastics that showcased their wit and wonderment
http://www.businessweek.com/investor/content/sep2007/pi20070918_630235.htm
Posted by: SPECTRE of Deflation | Sep 19, 2007 8:54:58 AM
"-He did not say the Iraq War is "largely about oil."
Someone help me out here: since the Iraq war is and always has been about oil, why can't we do the following: abandon rat holes like Baghdad-- indeed, abandon ALL the cities. Let the Shiites and Sunnis kill each other off, like they've been doing for over 100 years. Put all our troops around the key, biggest oil fields, most of which, presumably are not in urban centers. My understanding is that oil production in Iraq is still BELOW what it was pre-"liberation".
Posted by: Tom B | Sep 19, 2007 9:02:10 AM
Nice typo in the next to last sentence of the ("full post" link) article. Come on Nation, is anyone awake there?
Not to mention that his quibble about the oil issue seems pedantic and childish. Weren't we all a bit taken aback (in a refreshing way) to hear Greenspan acknowledge that Iraq is about oil (in some way)? How much might you have bet against him being this candid? Plenty IMO.
Posted by: PeterR | Sep 19, 2007 9:03:25 AM
Not to mention that his quibble about the oil issue seems pedantic and childish. Weren't we all a bit taken aback (in a refreshing way) to hear Greenspan acknowledge that Iraq is about oil (in some way)? How much might you have bet against him being this candid? Plenty IMO.
Posted by: PeterR | Sep 19, 2007 9:03:25 AM
He's more full of shit than a Christmas Turkey, and anyone who thinks otherwise is a damn fool.
Posted by: SPECTRE of Deflation | Sep 19, 2007 9:13:08 AM
Our leaders would never lie to us! This is America!
Posted by: Marcus Aurelius | Sep 19, 2007 9:58:55 AM
Dad to family:
Kids, your mom and I have some news. We've both lost our jobs due to the recent downturn in the economy. But don't worry - we still have credit cards! Now, what say we pile into the ol' Hummer and head on down to the Outback? I'm in he mood for a rib eye!
Posted by: Marcus Aurelius | Sep 19, 2007 10:04:27 AM
Well, Ben-Dover's plan to help out homeowners is backfiring...
The 10 and 30 year treasuries are swooning. Yield on 10-year is over 4.55%, and 30-year is over 4.86%.
So all those distressed ARM-holders who celebrated the fed cut, thinking they were going to get lower rates are about to get whacked.
Posted by: Pool Shark | Sep 19, 2007 10:13:41 AM
I read the testimony regarding tax cuts that was linked to. Greenspan didn't lie that I can see. His testimony may have been distorted by the administration for its own purposes but there's no endorsement of Bush's tax cuts, just that a tax cut may be useful.
"In today's context, where tax reduction appears required in any event over the next several years to assist in forestalling the accumulation of private assets, starting that process sooner rather than later likely would help smooth the transition to longer-term fiscal balance. And should current economic weakness spread beyond what now appears likely, having a tax cut in place may, in fact, do noticeable good."
"As for tax policy over the longer run, most economists believe that it should be directed at setting rates at the levels required to meet spending commitments...."
"But let me end on a cautionary note. With today's euphoria surrounding the surpluses, it is not difficult to imagine the hard-earned fiscal restraint developed in recent years rapidly dissipating. We need to resist those policies that could readily resurrect the deficits of the past and the fiscal imbalances that followed in their wake."
Of course, I don't recall his speaking out later regarding Bush's cuts and since he was speaking for himself in that testimony he probably should have just kept quiet.
After two wars, massive deficits, two asset bubbles, a massive transfer of wealth to the rich, LBOs and stock buybacks rather than investment, etc, etc, I am no fan of Greenspan and the role he played enabling it all. As always, his comments are hedged.
Posted by: Gary | Sep 19, 2007 10:19:01 AM
Why all the incessant fuss over Elmer Fudd?
We have a new (better) Captain at the helm, and I give him huge snaps for his actions so far. I know many call him Helicopter -- but remember that that quote is taken WAY out of context from where it came.
While people grouse over GS's "legacy", equities are making a HISTORIC move...
Posted by: Fred | Sep 19, 2007 10:39:43 AM
Did anyone catch this...
http://biz.yahoo.com/ap/070919/debt_limit.html?.v=3
This is crazy, basically if congress doesn't bend over for the administration the country could go into default.
Posted by: B. Egan | Sep 19, 2007 10:40:26 AM
From that article alone, I don't think AG is backpeddling on Iraq. According to the article, AG said "it's about oil" in his book and now says "it's about oil security". It's not a contradiction. It's more specific.
No one *I* know who says "it's about oil" thinks Bush went into Iraq to grab Iraq's oil and pump it out for free or even somehow cheaper than market. (Saddam was selling us his oil anyway.) The US is active in the *region* because of oil, to secure oil supplies without a war premium on a long-term basis. (Not that Bush's war has had the desired effect so far. But, after all, he planned to fail.)
So, to repeat, I see no backpeddling by AG on this issue.
Posted by: wunsacon | Sep 19, 2007 10:50:15 AM
"But, after all, he planned to fail."
You mean it wasn't the usual Bush incompetence?
Posted by: Tom B | Sep 19, 2007 11:20:47 AM
I reused the second half the "fail to plan, plan to fail" cliche. Yes, it was W's usual incompetence. (Boy, did that apple fall far from the tree.)
Posted by: wunsacon | Sep 19, 2007 11:26:22 AM
The Bigger they are - the bigger the Target
Alan was very big - he was very strong in our economy - between 1970 and 2000 this for get short term glitches - in that 30 years alan greenspan was the chair of the fed 18 years.
In that 30 years this country did all right and recovered nicely - no one man - giant - can turn an economy of 300 million people as a result of Greed, Politics,etc. He did a pretty good job. Volker did a very good job - Bernanke is the whore - can you imagine the shock of leaving the aura of Princeton and entering the world of, Remember the Star Wars scene in the interspace aeroport at the Bar - can you imagine Bernanke's response to walking into that bar?
Posted by: Paul | Sep 19, 2007 11:27:59 AM
You guys are great. Like a bunch of armchair Fed Chairmen. If you correctly forecasted all of these events, go get your PhD and try to get a job at the Fed. The country obviously needs someone with YOUR intelligence.
Posted by: RM | Sep 19, 2007 11:31:43 AM
Off Topic:
Barry/anyone....can you please analyze the below post by Mish....that FED is actually not printing a lot these days compared to past.
http://www.howestreet.com/articles/index.php?article_id=4744
Posted by: techy2468 | Sep 19, 2007 11:36:34 AM
"You guys are great. Like a bunch of armchair Fed Chairmen."
That's a cheap shot. The problem isn't that Bernecke is stupid or anything, just that he chooses to reward the wrong people; the people who, by and large, DESERVE to lose their shirts. At the COST of screwing EVERYBODY else. The dollar is worthless now-- you know we're like 1:1 with Canadian currency now?
Posted by: Tom B | Sep 19, 2007 11:38:49 AM
Tom B, I agree it was a cheap shot. But, the blame for the dollar can sure be spread around. On average, Americans supported tax cuts and bigger spending. No FED chairman is going to save the "reversion to mean" of a currency of a nation of spenders amidst a deterioration of their competitive advantages.
Posted by: wunsacon | Sep 19, 2007 11:50:46 AM
I used to read The Nation in college, but it never gave me much in terms of a realistic perspective of the world--particularly on economic matters. Their moral crusade is simply to blame the financial system. It's no wonder the American left is of little relevance today. The piece is too simplistic to the point of childish for lack of a better word.
Posted by: maximo zeledon | Sep 19, 2007 12:09:29 PM
wunsacon is correct in saying that Americans support tax cuts- asking them/us if we want a tax cut is like asking a kid if he wants a candy bar. The Republicans know this and have used it to recklessly cut taxes to the great detriment of our long term future. We have gotten to the point that talking about tax increases to cover the cost of government is like a poison pill for a political campaign, even as our country goes into unprecedented debt.
I also agree with Tom B.- Our elected government officials- including many Democrats- have largely shirked their duties to help Americans understand that we can't always have our cake and eat it too. That social services and wars cost a lot of money and that our nation's long term economic health is being endangered by reckless borrowing to avoid some short term discomfort.
Unelected officials such as Bernanke are in a better position to make choices that might cause some pain in the short term but will make us more secure in the long term. This is not to say that elected officials don't have similar responsibilities, but Bernanke does not have the excuse of the need to get re-elected and thus avoid any bad news (i.e. the need to raise taxes) no matter how realistic.
IMO Bernanke has shirked his duties. Unless there is more going on behind the scenes with the big banks and their shaky finances that we are not aware of, his move is hard to understand and wildly irresponsible.
Posted by: riverrat | Sep 19, 2007 12:14:09 PM
"No FED chairman is going to save the "reversion to mean" of a currency of a nation of spenders amidst a deterioration of their competitive advantages."
The competitive advantage can be restored by 1) more school spending 2) modest tariffs. I know the latter point will be a bit controversial, but, consider--- places like China have ZERO quality standards (Lead in toys, etc). American companies (as deregulated as we are) have SOME scruples.
Posted by: Tom B | Sep 19, 2007 12:26:27 PM
"Our leaders would never lie to us! This is America!"
Wait, I thought lying was the virtue of capitalism? You know, like now you have a pension, now you don't.
Posted by: me | Sep 19, 2007 12:36:44 PM
Tom, I don't know that we have to spend more on education. Maybe we do. (I don't know enough.) But, I wish one of our states would try vouchers.
I recall Perot recommending we should impose tariffs until trading partners enact laws like OSHA and establish agencies like the EPA. I would like to see us implement graduated tariffs by country, based on their compliance.
Posted by: wunsacon | Sep 19, 2007 1:31:12 PM
