Patrick's Rants


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3/15/2005

Is it time for Greenspan to go?

Filed under: Politics,Sensible Tax Reform,Social Security — site admin @ 5:23 pm

Alan Greenspan has been a long time neutral voice concerned merely with the financial fitness of the country. He has run the Federal Reserve Board with pragmatism without letting politics get in the way of his recommendations on interest rates. He bucked George HW Bush’s request to lower interest rates when it would have been in GHWB’s favor to have lower rates. Indeed GHWB blamed Greenspan for his election loss to Bill Clinton in 1992.
Greenspan urged Clinton to lower the national debt, lower the deficit. Clinton did and one of the best economies that we have seen in years, some might say since before Jimmy Carter, followed. Mr Greenspan cautioned against “exhaulted exuberance” in the stock market, he saw stocks that could not reasonably be priced the way they were without some kind of correction. The “tech bubble” popped not too long after.
He has been right more times than not, he is even arguably a financial genius. Why is it then that he is backing Dubya’s Social Security private accounts? Perhaps senility is setting in, perhaps he wants to be reappointed to his position on the board which expires in 2006, perhaps he is letting his politics get in the way of rational thinking.
George W Bush has raped this economy. Jobs have sloughed off faster than Dan Rather can spit out old country sayings. Dubya has spent more of the budget surplus built up under Clinton than can possibly be restored in 10 to 20 years by “cutting” taxes, paying reporters to write glowing reports supporting no child left behind, eroding the church and state bond through “faith based initiatives” and throwing money at a revenge war all the while cutting services that many have come to depend upon. To top it off at a town hall style meeting, a mother struggling to feed her children by working three jobs questioned Bush about the Social Security accounts. After her recounting of how difficult life was for her just trying to stay even Dubya responded with an enthusiastic, “that’s fantastic!” and went on to sell the privatization to her. It’s fantastic that she has to work three jobs and barely sees her children. The man is out of touch – perhaps a residual “high”.

I might start the cry for Greenspan to step down, but who might be waiting in the wings is even more frightening. I mean any time Dubya talks about or to one of his lackies he tells them what a “great service” they have done for the country (we owe Rummy a “debt of gratitude” for his “patriotic service”) which slows down the call for Greenspan’s resignation. Greenspan is not Dubya’s lacky, but there is a concern when he agrees with the raw sewage that spews from Dubya’s Alfred E. Newman characature of a face.

In case there wasn’t enough here on Social Security pillaging I profer the following links:

  • aarp.org
    discussion on Social Security reform.
  • aarp.org
  • A so-called balanced look at reform in a pro-con format with a suspiciously overweighted pro side.
  • factcheck.org looks at costs of managing private accounts while remaining neutral on support for privatization.
  • mynippon.com visits an interesting/scary/quietly under reported concepts of a zero gain for investor’s in private accounts. According to the article, once you reach retirement age you turn over your private account to the Social Security Administration. This article demands more information.
  • This page has a less dire point of view… yet, even Greenspan’s subdued mumblings cause consternation in the markets.
  • Finally, the previous article I wrote regarding my own ideas of reform

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