Thursday, January 03, 2008

Was Alan Greenspan a Libertarian?

Increasingly I see statements that a big problem Greenspan had while running the Fed was his Libertarianism. Specifically, Robert Reich says so here and Henry Kaufman says so in today's (still gated)WSJ.

I think this is bunk. Greenspan, by taking the Fed job and then repeatedly and continually practicing discretionary policies and attempting fine-tuning of the economy and pandering to his political bosses, went against pretty much every tenet of Libertarianism I can think of.

Now I've been confused on exactly what comprises Libertarianism in the past and maybe I'm still confused, but to me Greenspan's major malfunctions were egomania and a severe overestimation of his own intelligence, and not any residual damage from his days of Rand and Roses.

Wouldn't a Libertarian, if she would take the job at all, run some sort of predictable transparent rule based policy?


Tom said...

Angus is quite correct about the libertarian attitude toward The Central Bank (and all other Central Planning).

I'm frequently subjected to Robert Reich by a radio program called Marketplace. I have never known him to be right about anything.

John Thacker said...

I believe that Greenspan at one point said something that could be paraphrased as "Yes, a transparent rule would be best... for my successor to follow."

OTOH, if you think that hubris is a particularly likely failing of Randism as opposed to other forms of Libertarianism, it's perhaps not all that surprising. To me it's never seemed a huge leap from the super-skilled individual heroes of business in Rand's books to technocratic dreams of "fixing" the country, despite all the differences in underlying philosophy.

Shawn said...

John...wouldn't the most super-skilled businessman-libertarian realize that the disparate knowledge needed to 'fix the country' can never be contained in one person?

There's a vague correlation, I admit, between the two, but how could they, essentially, not only run their industry, but also those of their competitors and completely separate, unique industry?

How could Dagny oversee her industry, as well as Bill Gates'?

Simon Spero said...

I remember reading an article on Greenspan in "Liberty Magazine" that had some suprising quotes. I can't find the exact reference, but I did find an indirect citation in an article on a gold bug site:

Gold and Economic Freedom

Since finding out that for at least part of last year, the nickel had negative seigniorage I have decided to give up and go back to barter.