In "The Age of Turbulence: Adventures in a New World," published by Penguin Press, Mr. Greenspan criticizes both congressional Republicans and President George W. Bush for abandoning fiscal discipline.
Mr. Greenspan, who calls himself a "lifelong libertarian Republican," writes that he advised the White House to veto some bills to curb "out-of-control" spending while the Republicans controlled Congress. He says President Bush's failure to do so "was a major mistake." Republicans in Congress, he writes, "swapped principle for power. They ended up with neither. They deserved to lose."
Mr. Greenspan retired in early 2006 after 18 years as chairman of the Federal Reserve. He had served under six presidents as either Fed chairman or adviser. He now runs a private consulting company; his only formal public role is adviser to British Prime Minister Gordon Brown. Penguin paid an advance of more than $8 million last year for Mr. Greenspan's book, according to people familiar with the matter.
Mr. Greenspan writes that when President Bush chose Dick Cheney as vice president and Paul O'Neill as treasury secretary -- both colleagues from the Gerald Ford administration, during which Mr. Greenspan was chairman of the Council of Economic Advisers -- he "indulged in a bit of fantasy" that this would be the government that would have resulted if Mr. Ford hadn't lost to Jimmy Carter in 1976. But Mr. Greenspan discovered that in the Bush White House, the "political operation was far more dominant" than in Mr. Ford's. "Little value was placed on rigorous economic policy debate or the weighing of long-term consequences," he writes.
From serving under so many presidents, Mr. Greenspan concludes that there's something abnormal about anyone willing to do what it takes to get the job. Mr. Ford, he writes, "was as close to normal as you get in a president, but he was never elected." The Watergate tapes, he says, show Richard Nixon as "an extremely smart man who is sadly paranoid, misanthropic and cynical." He recalls telling someone who had accused Nixon of anti-Semitism that he "wasn't exclusively anti-Semitic. He was anti-Semitic, anti-Italian, anti-Greek, anti-Slovak. I don't know anybody he was pro."
Ronald Reagan's ability to instantly tap one-liners and anecdotes in support of a particular policy represented an "odd form of intelligence." Mr. Greenspan makes no mention of his successor as Fed chairman, Mr. Bernanke, other than in a caption accompanying a picture: "I was very comfortable leaving the post in the hands of such an experienced successor," it reads.
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Bill Clinton emerges as the political hero of "The Age of Turbulence: Adventures in a New World," Greenspan's 531-page memoir, which is being published Monday. Greenspan, who had an eight-year alliance with Clinton and Democratic Treasury secretaries in the 1990s, praises Clinton's mind and his tough anti-deficit policies, calling the former president's 1993 economic plan "an act of political courage."
But he expresses deep disappointment with Bush. "My biggest frustration remained the president's unwillingness to wield his veto against out-of-control spending," Greenspan writes. "Not exercising the veto power became a hallmark of the Bush presidency. . . . To my mind, Bush's collaborate-don't-confront approach was a major mistake." He says, "Little value was placed on rigorous economic policy debate or the weighing of long-term consequences." The large, anticipated federal budget surpluses that were the basis for Bush's initial $1.35 trillion tax cut "were gone six to nine months after George W. Bush took office." So Bush's goals "were no longer entirely appropriate. He continued to pursue his presidential campaign promises nonetheless."
Greenspan accuses the Republicans who presided over the party's majority in the House until last year of being too eager to tolerate excessive federal spending in exchange for political opportunity. The Republicans, he says, deserved to lose control of the Senate and House in last year's elections. "The Republicans in Congress lost their way," Greenspan writes. "They swapped principle for power. They ended up with neither." He singles out J. Dennis Hastert, the Illinois Republican who was House speaker until January, and Tom DeLay, the Texan who was majority leader until he resigned after being indicted for violating campaign finance laws in his home state. "House Speaker Hastert and House majority leader Tom DeLay seemed readily inclined to loosen the federal purse strings any time it might help add a few more seats to the Republican majority," he writes. By the end of last year, Greenspan writes with some bitterness, Washington was "harboring a dysfunctional government. . . . Governance has become dangerously dysfunctional."
However, he calls Clinton a "risk taker" who had shown a "preference for dealing in facts," and presents Clinton and himself almost as soul mates. "Here was a fellow information hound. . . . We both read books and were curious and thoughtful about the world. . . . I never ceased to be surprised by his fascination with economic detail: the effect of Canadian lumber on housing prices and inflation. . . . He had an eye for the big picture too." During Clinton's first weeks as president, Greenspan went to the Oval Office and explained the danger of not confronting the federal deficit. Unless the deficits were cut, there could be "a financial crisis," Greenspan told the president. "The hard truth was that Reagan had borrowed from Clinton, and Clinton was having to pay it back. I was impressed that he did not seem to be trying to fudge reality to the extent politicians ordinarily do. He was forcing himself to live in the real world." Dealing with a budget surplus in his second term, Clinton proposed devoting the extra money to "save Social Security first." Greenspan writes, "I played no role in finding the answer, but I had to admire the one Clinton and his policymakers came up with."
Greenspan interviewed Clinton for the book and clearly admires him. "President Clinton's old-fashioned attitude toward debt might have had a more lasting effect on the nation's priorities. Instead, his influence was diluted by the uproar about Monica Lewinsky." When he first heard and read details of the Clinton-Lewinsky encounters, Greenspan writes, "I was incredulous. 'There is no way these stories could be correct,' I told my friends. 'No way.' " Later, when it was verified, Greenspan says, "I wondered how the president could take such a risk. It seemed so alien to the Bill Clinton I knew, and made me feel disappointed and sad."
Known for his restrained if not incomprehensible public statements over the past several decades, Greenspan's direct criticism of Bush and his economic policies comes as the economy is emerging as an issue in the 2008 presidential race. And the man Greenspan praises so highly for fiscal probity is married to the current front-runner for the Democratic nomination, Sen. Hillary Rodham Clinton of New York.
The politically charged observations are scattered through the first half of the book, in which Greenspan offers a standard memoir covering his birth in the Washington Heights neighborhood of New York City in 1926 through his years as Fed chairman, from when he was appointed in 1987 by President Ronald Reagan to his retirement in 2006. His theme is the unequaled power of free-market capitalism; Greenspan calls himself a "libertarian Republican."
Without elaborating, he writes, "I am saddened that it is politically inconvenient to acknowledge what everyone knows: the Iraq war is largely about oil."
For all his wonkish ways, Greenspan writes with delight about his marriage to journalist Andrea Mitchell and their travels, friends and mutual love of classical music. He knows how to enjoy a good Vivaldi cello concerto in Venice.
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Mr. Greenspan, who calls himself a "lifelong libertarian Republican," writes that he advised the White House to veto some bills to curb "out-of-control" spending while the Republicans controlled Congress. He says President Bush's failure to do so "was a major mistake." Republicans in Congress, he writes, "swapped principle for power. They ended up with neither. They deserved to lose."
Mr. Greenspan retired in early 2006 after 18 years as chairman of the Federal Reserve. He had served under six presidents as either Fed chairman or adviser. He now runs a private consulting company; his only formal public role is adviser to British Prime Minister Gordon Brown. Penguin paid an advance of more than $8 million last year for Mr. Greenspan's book, according to people familiar with the matter.
Mr. Greenspan writes that when President Bush chose Dick Cheney as vice president and Paul O'Neill as treasury secretary -- both colleagues from the Gerald Ford administration, during which Mr. Greenspan was chairman of the Council of Economic Advisers -- he "indulged in a bit of fantasy" that this would be the government that would have resulted if Mr. Ford hadn't lost to Jimmy Carter in 1976. But Mr. Greenspan discovered that in the Bush White House, the "political operation was far more dominant" than in Mr. Ford's. "Little value was placed on rigorous economic policy debate or the weighing of long-term consequences," he writes.
From serving under so many presidents, Mr. Greenspan concludes that there's something abnormal about anyone willing to do what it takes to get the job. Mr. Ford, he writes, "was as close to normal as you get in a president, but he was never elected." The Watergate tapes, he says, show Richard Nixon as "an extremely smart man who is sadly paranoid, misanthropic and cynical." He recalls telling someone who had accused Nixon of anti-Semitism that he "wasn't exclusively anti-Semitic. He was anti-Semitic, anti-Italian, anti-Greek, anti-Slovak. I don't know anybody he was pro."
Ronald Reagan's ability to instantly tap one-liners and anecdotes in support of a particular policy represented an "odd form of intelligence." Mr. Greenspan makes no mention of his successor as Fed chairman, Mr. Bernanke, other than in a caption accompanying a picture: "I was very comfortable leaving the post in the hands of such an experienced successor," it reads.
online.wsj.com/article/SB...whats_news
Bill Clinton emerges as the political hero of "The Age of Turbulence: Adventures in a New World," Greenspan's 531-page memoir, which is being published Monday. Greenspan, who had an eight-year alliance with Clinton and Democratic Treasury secretaries in the 1990s, praises Clinton's mind and his tough anti-deficit policies, calling the former president's 1993 economic plan "an act of political courage."
But he expresses deep disappointment with Bush. "My biggest frustration remained the president's unwillingness to wield his veto against out-of-control spending," Greenspan writes. "Not exercising the veto power became a hallmark of the Bush presidency. . . . To my mind, Bush's collaborate-don't-confront approach was a major mistake." He says, "Little value was placed on rigorous economic policy debate or the weighing of long-term consequences." The large, anticipated federal budget surpluses that were the basis for Bush's initial $1.35 trillion tax cut "were gone six to nine months after George W. Bush took office." So Bush's goals "were no longer entirely appropriate. He continued to pursue his presidential campaign promises nonetheless."
Greenspan accuses the Republicans who presided over the party's majority in the House until last year of being too eager to tolerate excessive federal spending in exchange for political opportunity. The Republicans, he says, deserved to lose control of the Senate and House in last year's elections. "The Republicans in Congress lost their way," Greenspan writes. "They swapped principle for power. They ended up with neither." He singles out J. Dennis Hastert, the Illinois Republican who was House speaker until January, and Tom DeLay, the Texan who was majority leader until he resigned after being indicted for violating campaign finance laws in his home state. "House Speaker Hastert and House majority leader Tom DeLay seemed readily inclined to loosen the federal purse strings any time it might help add a few more seats to the Republican majority," he writes. By the end of last year, Greenspan writes with some bitterness, Washington was "harboring a dysfunctional government. . . . Governance has become dangerously dysfunctional."
However, he calls Clinton a "risk taker" who had shown a "preference for dealing in facts," and presents Clinton and himself almost as soul mates. "Here was a fellow information hound. . . . We both read books and were curious and thoughtful about the world. . . . I never ceased to be surprised by his fascination with economic detail: the effect of Canadian lumber on housing prices and inflation. . . . He had an eye for the big picture too." During Clinton's first weeks as president, Greenspan went to the Oval Office and explained the danger of not confronting the federal deficit. Unless the deficits were cut, there could be "a financial crisis," Greenspan told the president. "The hard truth was that Reagan had borrowed from Clinton, and Clinton was having to pay it back. I was impressed that he did not seem to be trying to fudge reality to the extent politicians ordinarily do. He was forcing himself to live in the real world." Dealing with a budget surplus in his second term, Clinton proposed devoting the extra money to "save Social Security first." Greenspan writes, "I played no role in finding the answer, but I had to admire the one Clinton and his policymakers came up with."
Greenspan interviewed Clinton for the book and clearly admires him. "President Clinton's old-fashioned attitude toward debt might have had a more lasting effect on the nation's priorities. Instead, his influence was diluted by the uproar about Monica Lewinsky." When he first heard and read details of the Clinton-Lewinsky encounters, Greenspan writes, "I was incredulous. 'There is no way these stories could be correct,' I told my friends. 'No way.' " Later, when it was verified, Greenspan says, "I wondered how the president could take such a risk. It seemed so alien to the Bill Clinton I knew, and made me feel disappointed and sad."
Known for his restrained if not incomprehensible public statements over the past several decades, Greenspan's direct criticism of Bush and his economic policies comes as the economy is emerging as an issue in the 2008 presidential race. And the man Greenspan praises so highly for fiscal probity is married to the current front-runner for the Democratic nomination, Sen. Hillary Rodham Clinton of New York.
The politically charged observations are scattered through the first half of the book, in which Greenspan offers a standard memoir covering his birth in the Washington Heights neighborhood of New York City in 1926 through his years as Fed chairman, from when he was appointed in 1987 by President Ronald Reagan to his retirement in 2006. His theme is the unequaled power of free-market capitalism; Greenspan calls himself a "libertarian Republican."
Without elaborating, he writes, "I am saddened that it is politically inconvenient to acknowledge what everyone knows: the Iraq war is largely about oil."
For all his wonkish ways, Greenspan writes with delight about his marriage to journalist Andrea Mitchell and their travels, friends and mutual love of classical music. He knows how to enjoy a good Vivaldi cello concerto in Venice.
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