Like many libertarians, I’ve come to hold a low opinion of Alan Greenspan. Austrian libertarians loathe him. Objectivists regard him as a traitor. Those who hate the free market alternate between thinking him a genius for allegedly giving us prosperity and saying that the current downturn is the result of his alleged free market ideas.
If he had free market ideas, why do so many free market libertarians despise him so?
But nothing destroys a good hate-fest like pointing out that Greenspan might not have been a traitor at all.
As strange as that may sound to libertarians, Bob Murphy makes that argument.
How could that be? Every act taken by Alan Greenspan has been one that Monetarists and Keynesians would approve of. During the entire eighteen years of his tenure his every act has been anathema to free market proponents.
Perhaps, argues Bob Murphy, Greenspan was motivated by his Objectivist beliefs to act like the perfect unrestrained Keynesian in order to show us that Keynesianism does not work. He was deliberately trying to break the system instead of thinking, as his admirers did during his tenure, that he was trying to find the winning combination that would result in unending prosperity.
In short, his Objectivist beliefs caused him to act like a Keynesian so he could destroy the economy. When the statist say his Objectivist beliefs caused the meltdown, they are right for the wrong reasons. They left out the middle term because that would cause them to doubt their own beliefs.
It’s a hard concept to grasp, because libertarians have spent the last twenty years hating Alan Greenspan. But we have to remember that Objectivists like to demonstrate that they are right. They like object lessons. The trashing of the economy is the San Sebastian Mines writ large.
If Bob Murphy is right that is. Unfortunately if he is there’s no way to find out. Alan Greenspan won’t admit it on this side of the grave.
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I’ve been wondering about the possibility of this since long before this economic crisis came about.
Fascinating theory!
It is. And if he were to tell, that would kinda spoil it.
But he might tell all before or after passing away. Which would be neat.
Generally speaking, incompetence is the simpler explanation compared to malice. That doesn’t mean that we can ignore the presence of malice in the world.
“Neca eos omnes. Deus suos agnoscet”
People are neither rational nor consistent because the “individual” is not the smallest unit of praxeological information. Each person is motivated by conflicting genes and memes fighting a constant war for control of our thoughts and actions in a struggle to propagate themselves. Different victors of any given internal skirmish can produce completely unrelated actions.
Often, the more intelligent and logical any person may seem to be, the better will be their capacity for plausibly rationalizing, to themselves and others, of internally conflicting ideas and externally inconsistent actions. Other logical, intelligent people observing this often try to do the same thing by proxy – searching for some single unified underlying motivation for noticeably inconsistent actions.
This includes attributing a life long hidden agenda to Greenspan, or for another example:
I just recently read this quote from Henry Hazlitt’s “The Failure of the New Economics” in which he puts forward the idea that the undoubtedly brilliant Keynes might have just been joking:
“Keynes was a brilliant man. Much of what he wrote he wrote in tongue-in-cheek, for the pleasure of paradox, to épater le bourgois [shock the middle class], in the spirit of Wilde, Shaw, and the Bloomsbury circle. Perhaps the whole of the General Theory was intended as a huge (400-page) joke, and Keynes was appalled to find disciples who took it all literally.”
I find this unlikely at best.
Keynes wasn’t joking.
Greenspan wasn’t secretly proving a philosophical point.
They were just otherwise very intelligent and logical men being self-delusional hypocrites.
As we all are – from time to time – to a greater or lesser degree.
I really like your larger point – it crystallizes some things for me.
But, I still find the idea that Greenspan actually is part of a Randian conspiracy to purposely crash the economy and reenact Atlas Shrugged to be perversely fascinating.
If I’m not mistaken Rand never “excommunicated” Greenspan, something that see did quite often. She did it to Barbra and Nathan Brandon, Murray Rothbard and a number of other people who disagreed with her. She even visited Greenspan and the President in the White House while Ford was President.
Hmmmmm….the plot thickens
And now for further developments.
Greenspan backs bank nationalization
“Dr. Binswanger, a longtime associate of Ayn Rand, is a professor of philosophy at the Objectivist Academic Center of the Ayn Rand Institute.”
Here is what he has to say about Greenspan…. http://www.capmag.com/article.asp?ID=5353 .
This speculation about some hidden, truly Objectivist agenda for Greenspan’s conduct is execrably dimwitted. What was Galt’s response when Mr. Thompson asked him to become Economic Dictator? That is a sufficient answer for any rational person.
-AleG