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drscottPres. Bush has nominated Ben Bernanke as new head of the Fed. This was widely viewed as good news, since he seems capable and likely to follow Greenspan's path.
Alan Greenspan has become the center of a cult of personality without actually having one. His tenure at the Fed has been characterized by an understanding of his symbolic role as guarantor of the currency, and while one can point to many small missteps (like failing to rein in the stock bubble a bit, while possibly overdoing the loosening in response to the crash and Asian financial crises), on the whole he provided more stability and reassurance than his predecessors. His past as a devotee of Ayn Rand didn't seem to prevent him from using a government post to build faith in a government institution (the Fed) which most Randites would argue is both unnecessary and counterproductive.
Interestingly, Bush would not have dared to nominate a crony for this position. Near-disastrous hyperinflation was touched off by Lyndon Johnson's "guns and butter" spending, monetized by the Fed's compliant bankers (notably Arthur Burns who did the bidding of both Richard Nixon and Jimmy Carter until the inflation and interest rate spikes became a threat to the economy.) Since then, global investors are hypersensitive to the temptations governments have to use the Fed to steal from the future for current political survival, and punish even a whiff of laxity at the central bank.
Apparently the Supreme Court is another story. Bush's nomination of Harriet Miers is in serious trouble despite the apparent backroom deal between Senate Dems and the White House to pass her. Seems there's a level of mediocrity and cronyism thoughtful Republicans won't put up with, the religious right isn't assuaged, and Democrats who weren't consulted in advance wonder why it's in the country's interest to have such an undistinguished person on the court. Reminds me of the famous speech by Sen. Roman Hruska defending mediocrity, which was amusingly parodied by Mad Magazine in my youth.
Alan Greenspan has become the center of a cult of personality without actually having one. His tenure at the Fed has been characterized by an understanding of his symbolic role as guarantor of the currency, and while one can point to many small missteps (like failing to rein in the stock bubble a bit, while possibly overdoing the loosening in response to the crash and Asian financial crises), on the whole he provided more stability and reassurance than his predecessors. His past as a devotee of Ayn Rand didn't seem to prevent him from using a government post to build faith in a government institution (the Fed) which most Randites would argue is both unnecessary and counterproductive.
Interestingly, Bush would not have dared to nominate a crony for this position. Near-disastrous hyperinflation was touched off by Lyndon Johnson's "guns and butter" spending, monetized by the Fed's compliant bankers (notably Arthur Burns who did the bidding of both Richard Nixon and Jimmy Carter until the inflation and interest rate spikes became a threat to the economy.) Since then, global investors are hypersensitive to the temptations governments have to use the Fed to steal from the future for current political survival, and punish even a whiff of laxity at the central bank.
Apparently the Supreme Court is another story. Bush's nomination of Harriet Miers is in serious trouble despite the apparent backroom deal between Senate Dems and the White House to pass her. Seems there's a level of mediocrity and cronyism thoughtful Republicans won't put up with, the religious right isn't assuaged, and Democrats who weren't consulted in advance wonder why it's in the country's interest to have such an undistinguished person on the court. Reminds me of the famous speech by Sen. Roman Hruska defending mediocrity, which was amusingly parodied by Mad Magazine in my youth.
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Date: 2005-10-24 11:35 pm (UTC)