Won’t You Come Back, Alan Greenspan?

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Won't You Come Back, Alan Greenspan? Won't You Come Back?

by Walter Block

Recently by Walter Block: A Few Questions, Concerning the Present RonPaul CampaignSituation

This is the second entry in my "Won't you come back" series. The first was devoted to Bill Evers, this one to Alan Greenspan. Each of these episodes is dedicated to a person who was once a leading libertarian and/or Austrian economist, but who later on went native. It is my attempt to invite them back into the fold. My thought is that we need all the help we can get if we are to attain liberty, and it might be easier to make such a "sale" to someone who not only once "bought" it, but at an earlier time in his life was a fervent devotee to our freedom philosophy.

Alan Greenspan certainly fits this bill. At an earlier time in his life, he was a strong free enterpriser. What's this, you say? Alan Greenspan, a supporter of laissez faire capitalism? Are you indulging in controlled substances? Why, the man was head of the Federal Reserve, and any idiot ought to know that this represents the Sovietization of a core element of our economy, the money supply. If this is not central planning run amok, then nothing is, you say to me indignantly. Have you not read Ron Paul's End the Fed, you moron?

Yes, yes, I know all this. Really, I do. But I am not speaking of the "mature" Alan Greenspan, the one who has "grown in office" to such a degree that he has lost all connection to economic freedom. I refer to a bygone era.

There really was, once upon a time, an earlier, younger, less "sophisticated" Greenspan who was not only an articulator of our philosophy, but a veritable leader of our movement. If you don't believe me, see here: "An almost hysterical antagonism toward the gold standard is one issue which unites statists of all persuasions. They seem to sense-perhaps more clearly and subtly than many consistent defenders of laissez-faire — that gold and economic freedom are inseparable, that the gold standard is an instrument of laissez-faire and that each implies and requires the other."

Further states Greenspan: "But the opposition to the gold standard in any form — from a growing number of welfare-state advocates — was prompted by a much subtler insight: the realization that the gold standard is incompatible with chronic deficit spending (the hallmark of the welfare state). Stripped of its academic jargon, the welfare state is nothing more than a mechanism by which governments confiscate the wealth of the productive members of a society to support a wide variety of welfare schemes. A substantial part of the confiscation is effected by taxation.

"But the welfare statists were quick to recognize that if they wished to retain political power, the amount of taxation had to be limited and they had to resort to programs of massive deficit spending, i.e., they had to borrow money, by issuing government bonds, to finance welfare expenditures on a large scale.

"Under a gold standard, the amount of credit that an economy can support is determined by the economy’s tangible assets, since every credit instrument is ultimately a claim on some tangible asset."

Pretty good, eh? I go so far as to say that it would be hard to improve upon these statements as a clarion call for economic freedom, the gold standard, liberty, and opposition to statism.

I have a personal reason, in addition to wanting to build up the freedom philosophy movement, for wanting to bring Greenspan back in touch with his earlier Austro-libertarian roots: he was one of the people instrumental in my own conversion. After meeting Ayn Rand and Nathaniel Branden at Brooklyn College in 1963 where I attended as an undergraduate and she gave a speech, I was invited to their homes in Manhattan to continue our conversation. Alan Greenspan was one of the people in attendance when I visited there. I remember giving him the argument to the effect that free market monopoly was a market failure, and that anti-trust was therefore justified. (Hey, none of us were born as pure Austro-libertarians!) He batted that one out of the park at me, and I was on my way, with a little help from him. And a lot from Ayn Rand's Atlas Shrugged, and Henry Hazlitt's Economics in One Lesson. (I didn't meet Murray Rothbard until 1966, when I became fully radicalized.)

So, come back Mr. Greenspan, come on back. The water is fine here in libertarian land. Yes, you have a lot to make up for. You really screwed the country with your running of the Fed. You disappointed a lot of good people by turning your back on liberty. And, I'm not sure what a libertarian Nuremberg trial would make of you. But I know this much: if you repent, and try to do what you can, now, to promote liberty and make up for past misdeeds, things will be better for you than if you do not. And things will be better for the rest of us too.

Dr. Block [send him mail] is a professor of economics at Loyola University New Orleans, and a senior fellow of the Ludwig von Mises Institute. He is the author of Defending the Undefendable, The Case for Discrimination, Labor Economics From A Free Market Perspective, Building Blocks for Liberty, Differing Worldviews in Higher Education, and The Privatization of Roads and Highways. His latest book is Ron Paul for President in 2012: Yes to Ron Paul and Liberty.

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