Goodbye to Alan Greenspan

The New Yorker

COMMENT
MONEYMAN

by John Cassidy
Issue of 2006-02-06
Posted 2006-01-30

Alan Greenspan, who retires this week after serving four and a half terms as chairman of the Federal Reserve, is arguably the most skillful bureaucratic survivor the nation’s capital has seen since J. Edgar Hoover. But unlike the late, unlamented director of the F.B.I., who terrorized his way to longevity, Greenspan practiced the subtler art of ingratiation. His Washington career began when he joined Richard Nixon’s 1968 campaign. After Watergate, he switched his loyalties to Gerald Ford, serving as the head of the White House Council of Economic Advisers. In the summer of 1987, Greenspan was Ronald Reagan’s choice to succeed Paul Volcker at the Fed.

Weathering the Black Monday stock-market crash that came a few months after he took office, Greenspan gradually established his authority. He became the public face of American prosperity: calm, credible, upbeat. Under Bill Clinton, he worked closely with three treasury secretaries—Lloyd Bentsen, Robert Rubin, and Lawrence Summers—to eliminate the budget deficit. Then, barely a month after the 2000 election was resolved, Greenspan endorsed George W. Bush’s plan for top-heavy tax cuts. The plan passed, the surplus disappeared, and, in 2004, Bush nominated Greenspan for another four-year term. “He’s extraordinarily good at getting along with people in power,” William Seidman, a former head of the Federal Deposit Insurance Corporation, has said. “He has the best bedside manner I’ve ever seen.”

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