Is Brad DeLong Turning on Alan Greenspan?

Now here’s an interesting development in the Greenspan

Wars. Brad DeLong, Greenspan’s apologist-in-chief, spends

884 words essentially saying "well, it’s not Greenspan’s fault he’s

a political hack". Since Paul Krugman’s chief complaint about Greenspan

is that he (Greenspan) turned out to be a political hack, it seems that DeLong

and Krugman might not be quite as far apart on this issue as we thought.

DeLong first says that Krugman is asking a lot of a man who is, after all,

a Republican, and then constructs this astonishing imaginary dialogue between

Greenspan and James Baker, in the run-up to Greenspan’s nomination as Fed chairman:

Greenspan: Paul Volcker is a very good guy, but he regards

himself as a technocrat. He is not political, like you and I are.

He does his technocratic job. Carter appointed him. Yet the fact that his

monetary policies cost Jimmy Carter reelection was simply not something that

entered Vocker’s mind…

Baker: Volcker says that he had no choice, that he had to

act in 1979-1980…

Greenspan: There is always a choice. It would be a shame

if it came around to 1991, and somebody who did not understand the political

realities like you and I do were sitting in the Fed chair. My old teacher

Arthur Burns always understood political realities…

Baker: You make some interesting points. I think I understand


With friends like these, Greenspan hardly needs enemies: DeLong is essentially

admitting that Greenspan allowed party-political considerations to drive his

behavior during the Bush 43 administration. (Although he was either too principled

or too green to allow those considerations to drive his behavior during the

Bush 41 administration.)

For the record: yes, both DeLong and Krugman can reasonably be considered

to be political hacks are political partisans themselves. But as far

as I know, no one has ever proposed that either of them join the board of governors

of the Federal Reserve, let alone chair it. Economists are more than welcome

to be political hacks. Central bankers, no.

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