Alan Greenspan guided American financial policy from the Trickle-Down days of Ronald Regan to just before the Bailout give-away days of George W. Bush.
Alan Greenspan was appointed Fed chairman by President Ronald Reagan in August 1987. He served Presidents Ronald Reagan, George H.W. Bush, William Jefferson Clinton, and George W. Bush.
To understand the damage that Greenspan did to our country, you must remember that he was the most notorious of modern Laissez-Faire advocates. Alan firmly believed that "private regulation generally has proved far better at constraining excessive risk-taking than has government regulation" a fact he verbalized in a May, 2005 speech.
Alan put words to the ideas Ronald Reagan and the Republicans wanted to legalize. They loved him! "Trickle-Down" passed from theory to fact. Nobody had the courage to openly mention "trickle-down" and "Laissez-Faire" or "greed" in the same sentence.
(Note: The "excessive risk-taking" that Alan played word games with was, in fact, the general public's welfare. When Wall Street Financiers were threatened, Alan G. changed his stripes and promoted "bailout" economics.)
Now, in October, 2008, policy makers are struggling to contain the global financial crisis that "Trickle-Down" helped orchestrate. "Trickle-Down", it seems, hit a bottle-neck. From the very beginning, Trickle-Down (i.e. Laissez-Faire, i.e. Greed) never could accommodate the needs of a modern industrialized nation. Trickle-down failed in the 18th Century, the 19th Century, the 20th Century, and the first 8 years of the 21st Century. Now, in October, 2008, Greenspan expresses "shocked disbelief'' that private greed did not regulate itself.
Now, in October, 2008, rescued insurance company AIG , succumbing to pressure exerted by the State of New York, has agreed to freeze a $600 million bonus fund. Poor Martin Sullivan, former AIG Chief Executive Officer won't receive his $19 million for quite a while. Aaah, the high price of Bailout.
Now, in October, 2008, Regulated Economies, call it State Capitalism if you must, again provides the leash that keeps Trickle-Down (i.e. Laissez-Faire, i.e. Greed) from destroying the proverbial goose that laid the golden egg. Control of the American economy has passed from the benign Greedy to the benign State.
Hold on to your purses, the pendulum is swinging.
- 2q(Jim)
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2 comments:
2q, do you have any comments regarding the presidential candidates' tax plans and how they'll affect the economy?
Curt,
Hold on to your wallet!
Whoever inherits the White House will have to increase government revenues. Look for not only income taxes, but ALL taxes, fees, licenses, etc to go up.
At the same time the Feds will probably delay, defer, or deny payments to states and cities.
This will result in local governments increasing taxes, fees, licenses, etc.
In a declining economy, a government has to protect itself, and maintain its own standard of living, by asking J.Q. Average to sacrifice more of the less that he has.
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