The Myth of Republican Fiscal Responsibility

BBC NEWS | Americas | Greenspan attacks Bush on economy:

Greenspan attacks Bush on economy. The former chairman of the US Federal Reserve Alan Greenspan has said President George W Bush pays too little attention to financial discipline. In a book to be published next week, Mr Greenspan says Mr Bush ignored his advice to veto "out-of-control" bills that sent the US deeper into deficit. And Mr Bush’s Republicans deserved to lose control of Congress in last year’s elections, he charges.

In the run up to the 2000 US presidential election there was a lot of media chatter about Bush being unqualified.  I remember people talking about how that wouldn’t be a problem because he would be surrounded by experts from the Reagan and Bush administrations.  He did have Cheney and Rumsfeld and Powell.  But, luckiest for the nation, he had Fed chairman Alan Greenspan.  Trying to ride herd on the wild wild west that is the US economy is hard work.  It requires a dispassionate genius to oversee fiscal policies that affect the entire world economy.

Fed chairmen are not elected.  They are appointed by the president and then vetted and confirmed by the Senate.  They have to be the best of the best.  They can’t afford to screw up and they generaly know what they are talking about. 

Alan Greenspan’s new book reveals that Bush chose to ignore the advice of the man who he himself reappointed.  Greenspan served as the Fed Chairman for 19 years.  He saw the nation through multiple recessionary periods and prevented inflationary problems.  One of the roles of the Fed chairman is to advice congress and the president.  Greenspan advised Bush, on more than one occasion, to veto spending initatives originating in the Republican congress prior to the 2006 election.

Quotes from the book about Bush and the Republican congress:

• "Little value was placed on rigorous economic policy debate or the weighing of long-term consequences," he says of the Bush administration.
• Republicans in Congress "swapped principle for power" and "ended up with neither".
• "They deserved to lose."

Greenspan stepped down from the Fed in 2006 and now works in the private sector and as an advisor to the British government.   This is brain drain of the worst sort for the US.