I have not read Alan Greenspan's latest missive, nor do I intend to. However, I have been hearing interviews and reading news articles. And I find myself saying over and over, "What? That is either far-fetched or terribly eccentric thinking." I am not the only one. Here is one sample of a critic.
Take for instance his musings on the results of the fall of communism in a recent WSJ article.I quote:
He attributes the housing boom to the end of communism, which he says unleashed hundreds of millions of workers on global markets, putting downward pressure on wages and prices, and thus on long-term interest rates.That is the first time I have ever heard such a thing.
Then I hear him in an interview recently saying that the current Administration is fiscally irresponsible and overly political with economic policy. But if I recall, it was he who supported Bush's tax cuts. He says that this was contingent on a Pay-go-system. I don't recall that part of his congressional testimony back in 2001.
In an NPR interview on Sept 19 he was suddenly expressing great concern over the Baby Boom retirement and the stress it will place on benefit programs. WHOOA! Now that Mister-let's-cut-rates-to-1% is in retirement, he is suddenly worried about our medicare shortfall? Remember the "lock box" that was forgotten not long after Al Gore's orange make-up and exasperated sighs?
He is also concerned with the increasing income gap, which he says may lead to an erosion of cultural ties in the country and then to violence. Well, gee, ya think? But his "libertarian-Republican", Ayn-Rand loving self makes him fear a populist Congress more than a conservative Congress. Yet it was populism that built a solid middle class in this country and conservativism that has tore that down. So,I don't get his logic.
In the NPR interview, he went on to say that our actual deficits are - wait for it- small. He supported tax cuts because at the time, our surpluses were- wait for it- too large. But the seriously ironic part of all of this is that he said he was afraid of what the Administration would do with the surplus.
He then said that unfortunately the surpluses dried up much more quickly than anticipated. This is why we are now in trouble. Well, Mister Money, "Your unwarranted exuberance nearly destroyed the world. And "until you pay back the ten trillion dollars this operation cost me, you're married to it!"