The connection of Alan Greenspan to Ayn Rand, decades ago, is being used to blacken her name and her ideas.
This from the Leftist “Mother Jones” publication is one of the milder expressions:
“In a historic moment, former Fed chair Alan Greenspan acknowledged he had been wrong for years to assume that government regulation was bad for markets. Whoops–there goes decades of Ayn Rand down the drain.”
Rightist publications are joining in the smear: Forbes magazine’s online blog states:
“Greenspan, protege of Ayn Rand and the driving mind behind the notion that risk can be contained by having ever growing numbers of market players taking pieces of that risk, has now admitted that ‘Those of us who have looked to the self-interest of lending institutions to protect shareholder’s equity (myself especially) are in a state of shocked disbelief.’ […] ”The whole concept of self-regulation through self-interest is now dead,”
In response, I posted this comment on the Forbes site:
The lesson people have drawn from Greenspan’s failure is exactly backwards. Greenspan, “the maestro,” and his dream-team staff, couldn’t figure out how to run the economy. It was the Fed’s expansion of the money supply (1% interest rates!) that created the bubbles. So interventionism has failed, as it always does. Can anyone seriously say, “an even smarter version of Greenspan will get it right next time”?
The article says self-regulation is now dead. Okay, what’s the alternative? Regulation by the state–i.e., by new Greenspans? Forbes, above all publications, should be clear that the alternative to self-regulation is state dictation, the command economy.
Deregulation? There were 51,000 NEW regulations added over the last 12 years. Banking, housing, and insurance are the most regulated areas of the economy. They are strangled by regulations. This is the failure of the regulatory state.
As to Greenspan, this is the penalty of betraying Ayn Rand’s philosophy. To paraphrase Lloyd Bentsen’s famous riposte: Dr. Greenspan, I knew Ayn Rand, and you’re no Objectivist.
Let’s review the record in regard to Greenspan’s progressive split from Ayn Rand.
I can’t say I knew Alan Greenspan, though, being an associate of Ayn Rand, I met him a few times in the 1960s. But by 1970–almost 40 years ago–I and a couple of other Objectivists in that circle already realized that Greenspan was compromising on her philosophy. Little did we know how far his anti-Rand journey would take him. As the years rolled on,
- he was hailed as the man who “saved” Social Security–by extending its confiscatory power,
- when Bill Clinton’s State of the Union address called for socialized medicine, he rose to his feet, standing next to Hillary Clinton in giving a standing ovation to that proposal,
- he became head of the mammothly anti-capitalist Federal Reserve, directing the government’s manipulation of money and credit,
- he provided a laudatory dust-jacket blurb for a book attacking Ayn Rand (by a woman he had “irrevocably” condemned in print in 1968). Yet he repeatedly refused to contribute to or lend his name to the Ayn Rand Institute,
- he wrote, in 1995, that government central banking is a necessity: “Only a central bank, with unlimited power to create money can guarantee that such a process [”a cascading sequence of defaults”] will be thwarted before it becomes destructive.” (Note that we just witnessed this “cascading sequence of defaults” despite –or, actually, caused by –our central bank.),
- and now he has blamed free markets (as if we had them!) for his failures at the Fed. In conceding that his “ideology” was wrong, he was understood to be saying Ayn Rand was wrong–even though he had long ago forgotten or evaded every essential of what Ayn Rand stood for. read more……
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