His Due

by digby

Here’s an interesting article about Alan Greenspan’s new book. It sounds oddly gripping yet bizarre:

Mr. Greenspan returns repeatedly to the far-reaching importance of communism’s collapse. He says it discredited central planning throughout the world and inspired China and later India to throw off socialist policies. He recalls meeting a former manager of a produce distribution center in China who says he once had to labor to allocate produce according to government edict; now the allocations are made by auction. “Now I don’t have to get up at four a.m.,” he quotes the manager as saying. “I can sleep in and let the market do my job for me.” Mr. Greenspan recalls his amazement when an adviser to Russian President Vladimir Putin asks him to discuss Ayn Rand, the libertarian philosopher with whom Mr. Greenspan had been friends.

I have a feeling that advisor just wanted to see if it was actually true that the single man with the most influence on America’s economy, and the world’s, could really still be impressed with that adolescent romance novelist. It’s hard for me to believe too. But he wasn’t just a fan. He was a member of Rand’s inner circle:

Greenspan was initially a Keynesian and logical positivist, but was converted to Objectivism by Rand. During the 1950s and ’60s Greenspan was a proponent of her philosophy, writing articles for Objectivist newsletters and contributed several essays for Rand’s 1966 book Capitalism: the Unknown Ideal including an essay supporting the gold standard.[7] During the 1950s, Greenspan was one of the members of Ayn Rand’s inner circle, the Ayn Rand Collective, who read Atlas Shrugged while it was being written.

Imagine that. Reading Atlas Shrugged while it was being written! I’ll bet that makes college Republicans and Jonah Goldberg feel all funny in their pants just thinking about it.

I’ll look forward to the economists around these parts delving into his explanations and rationales for what he did over his long run at the fed. It sounds as if he spends quite a bit of time tap dancing. But I’m most interested in his take on the various presidents he worked with. For instance:

he believes that “Richard Nixon and Bill Clinton were the most intelligent, he wrote, while he found Ford the most normal and likeable. Ronald Reagan was the most devoted to free markets, though his grasp of economics “wasn’t very deep or sophisticated.”

Whodda thunk? The current miscreants apparently come in for quite drubbing:

Soon after Bush took office, Greenspan wrote in a new book, it became evident that the Treasury secretary and White House economists would play secondary roles in decisions on taxes and other issues. In addition, officials with whom he had worked in the administration of President Gerald Ford changed after Bush brought them back to Washington, he said he found.

“The Bush administration turned out to be very different from the reincarnation of the Ford administration that I had imagined. Now, the political operation was far more dominant,”

Is he suggesting that Dick Cheney’s famous dictum, “Reagan proved deficits don’t matter…this is our due,” is not sound economic policy? How odd. And I wonder if he thinks that encouraging broke, indebted home buyers who had no chance of economic improvement to buy those volatile ARM’s as he did a couple of years ago was sound economic policy too? I guess I’ll have to read the book to find out.

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