Greenspan Hits Iceburg, All Feared Lost

In congressional testimony today, former Chair of the Federal Reserve Alan Greenspan lit the fuse on his own legacy, and blew out the foundations. See the story in The Newspaper of Record.

Greenspan stood athwart the American financial landscape like a Titan for the better part of two decades. Markets trembled at the whims of his occasional, generally convoluted, public statements. In one sense, seeing him admit that the philosophy of deregulation that had informed his professional thinking for most of his adult life has proven deeply flawed feels tragic, the emperor revealed sans clothes.

On the other, it's impressive that he owned the failure. Many in the clips of the congressional hearings I have heard seemed eager to pile on, driving to skewer both the man and the ideology as completely as possible. That hardly seemed necessary- Greenspan was more than ready to admit that in his own eyes he had erred, and to place blame on his own policy decisions. That says a great number of positive things about Greenspan's character, even if his economic model will probably not be guiding many economies in the future.