Greenspan's testimony today is a remarkable
departure from his operational, hard-right
conservative mode. It's like a mini-Ayn Rand
burst out of his chest, a la Alien.
I do not refer to his acquiesence to tax cuts.
This was not unexpected, merely a sign of his
political scruples. Boy, isn't it great that
the Fed is politically independent?
Rather, it was his justifications for doing so.
These included the merits of the government
*failing* to divest itself of debt, since a
government with no debt to service would be
in danger of using tax revenue to purchase
financial assets, and this would be bad.
So in this AG is implicitly declaring that,
by his lights, Social Security should not be
funded in any way to meet expected future needs.
Then there was some babbling about the prohibitive
expense of liquidating Treasury debt. This was
simply an expression of willful ignorance.
Then there was the idea that a smaller surplus
would preclude government spending. So in effect,
AG is resurrecting the rationale in the 1980's
for the '81 tax cuts.
I spoke to Hill staff who were stunned by all
this. Maybe some Members will now figure out that
fiscal discipline only applies when a Democrat
might get credit for spending or tax cuts.
So in my book, besides revealing himself to be
a political hack suitable for Supreme Court
nomination, AG certifies himself as a full-
fledged Nut.
mbs
