Charles, Arthur Burns, who had blocked Murray Rothbard’s hard-money PhD at Columbia until Ike made Burns chairman of the council of economic advisors, also engineered Nixon’s great inflation. After his term as Fed chairman, Burns was rewarded by Nixon with the ambassadorship to Germany.
At a press conference when he arrived in that country, some smart German reporter asked Burns how he could have connived at the monetary depreciation that had wreacked such havoc, since surely, as an economist, he knew better.
Burns–whom Murray described as sounding like W.C. Fields without the humor–answered, the Fed chairman has to do what the president wants, or “the central bank would lose its independence.” He meant, of course, its ability to live high on the hog, and reward its constituents in banking and Wall Street.
A retired Fed official once told me that was “the most damaging statement” ever made by anyone associated with the central bank. It certainly meets Michael Kinsley’s definition of a political gaffe: inadvertently telling the truth.
8:53 am on January 21, 2008 Email Llewellyn H. Rockwell, Jr.
