Greenspan’s reputation continues to decline

By Felix Salmon
April 9, 2009

Neil Irwin has a nothing-new-here profile of Ben Bernanke in the Washington Post. What struck me, however, was the way that his collegial style was characterized very much in terms of what (and, implicitly, who) it’s not:

To many Fed veterans, his leadership style is a stark contrast with that of his predecessor, Alan Greenspan, whose tenure was characterized by tightly controlled decision-making with only rare open disagreement.

“It’s not Ben’s personality to pound the table and scream and say you’re going to agree with me or else,” said Alan Blinder, a former Fed vice chairman and longtime colleague of Bernanke’s at Princeton University. “It’s not his way. I’ve known him for 25 years. He succeeds at persuading people by respecting their points of view and through the force of his own intellect. He doesn’t say you’re a jerk for disagreeing.” …

“The chair of any committee can respond to comments that challenge his view in ways that essentially inform the committee that the issue isn’t worth discussing. This chairman doesn’t do that,” said Jeffrey M. Lacker, president of the Richmond Fed, who worried that the Fed was putting itself in the uncomfortable position of allocating capital in the economy. “He takes other views seriously.” …

“He tries to bring as much input as possible,” said Kansas City Fed President Thomas Hoenig. “He’s always been willing to ask questions, accept input and be responsive to that input.”

We probably knew that Alan Greenspan was never a big fan of getting lots of input from the FOMC. But this looks to me very much as though Jeffrey Lacker is going on the record as implying that Greenspan didn’t take other views seriously, and that Alan Blinder is going even further than that.

Once upon a time, even after Greenspan’s departure, such high-ranking officials would have been careful to disavow such implications. Now, they don’t seem to care any more. If Greenspan is upset by this kind of thing, who cares. He’s a historical relic at this point.

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