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Ardent Listener
Administrator
USA
4841 Posts |
 Posted - 10/26/2008 : 19:12:12
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Alan Greenspan, ''Savant Idiot''
Michael M. Thomas 10.24.08, 1:45 PM ET
In 1914, John Alexander Smith, professor of moral philosophy at Oxford, addressed the first session of his two-year lecture course as follows:
"Gentlemen, you are now about to embark on a course of studies that (will) form a noble adventure…let me make this clear to you…nothing that you will learn in the course of your studies will be of the slightest possible use to you in after life--save only this--that if you work hard and intelligently, you should be able to detect when a man is talking rot, and that, in my view, is the main, if not the sole purpose of education."
I happened upon Professor Smith long years ago, in the 1980 edition of John Julius Norwich's Christmas Cracker, and his words have stayed with me ever since. And never more frequently and more intensely than in conjunction with the public utterances of Alan Greenspan.
I have encountered Greenspan in the flesh but twice. The first occasion was at a small lunch some 20-odd years ago at a foundation that concerned itself with the great issues of what we used to call "political economy." Greenspan was then a Wall Street consultant, not yet at the Federal Reserve. For the better part of two hours, I listened carefully to what Greenspan had to say and studied him closely. I concluded as I left that here was a prize, chateau-bottled phony and opportunist. A prime example of a talker of rot.
Nothing since has inspired a change of mind. In 1998, I was privileged to write a savage review of Bob Woodward's Maestro, a study of Greenspan that gave new resonance to the phrase "boot-licking." I noted the interesting factoid that Greenspan attended the same Bronx high school as that other singular figure of the postwar era, Henry Kissinger--a virtual doppelganger when it comes to opportunism and blather--and wondered whether there might be something in the water up there. More importantly, I also rendered the opinion that the Great Man's policies were based on specious, if not outright false, assumptions. Now we know.
And now, apparently, so does Greenspan.
The Great Man's mea culpas before Congress are a matter of record. The consequence of his convictions, considered broadly, can be observed deeply woven into the current financial and economic mess. No news there. But there is another aspect to Greenspan's intellectual rise and fall that bears thinking about.
As credit has contracted, markets have fallen and national economies have become constrained, a kind of urban legend has grown up that much of this flows from the handiwork (principally in the mortgage and derivatives "spaces") of very smart people. Well, I am here to tell you that this is not so.
The fine fix we find ourselves in is mainly the work of idiots. Idiots with Ph.Ds. Idiots of a rather specialized genus, whom I call savants idiots, of whom the former Fed chairman is perhaps the most visible and emblematic example.
Most halfway-educated people know about idiot savants, people who are dyslexic, autistic or otherwise gravely impaired by "normal" cognitive and psychological metrics, but who can reel off complex algorithms and theorems or intuit great scientific truths.
I submit that there is a corollary genus, the savant idiot. This is one who is festooned with credentials, diplomas, laurels and prizes both professional and academic, who pontificates and expounds impressive-sounding "truths" and explanations--what a friend of mine used to call "chinstrokers"--that in the fullness of time and markets prove to be utter b.s. The idiot savant produces substance out of apparent ignorance; the savant idiot produces ignorance from apparent substance.
Lord only knows how the present crisis will play out. Many hard lessons will be learned. Among them must be a restored capacity for perceiving when men in power are speaking rot. This is a capacity beyond the grasp of idiots. Stupidity, like misery, loves company.
Michael M. Thomas, a former investment banker, is the author of seven novels about big business and high finance. His eighth, Love & Money, will be published in 2009 by Melville House.
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Sad, and I worry about his health now that he is no longer an asset but a liability who is talking too much.
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Delawhere Jack
1000+ Penny Miser Member
USA
1680 Posts |
 Posted - 10/26/2008 : 20:00:19
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quote:
Originally posted by Ardent Listener
Sad, and I worry about his health now that he is no longer an asset but a liability who is talking too much.
You've got more compassion than I can muster for him......
Good article, blunt and to the point, the way I like it.
Problem is, apparently his successors suffer from the same malady to an even greater extent, and those cogent enough to detect the ROT are dismissed as cranks, worry-worts, chicken littles. Or at least they used to be.
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"Educate and inform the whole mass of the people... They are the only sure reliance for the preservation of our liberty." Thomas Jefferson
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swusc
Penny Hoarding Member
USA
553 Posts |
Posted - 10/27/2008 : 09:36:34
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I feel for Greenspan in the fact I think he knew the risk, but was hired to do a job. It is kind of like blaming the QB for a going for it on a failed 4th down call. Yea, it screw up while he was leading the offense, but he didn't make the call to go for it either. The coach made that call.
Greenspan was the the QB and Congress was the Coach.
The root of the problem is people have learned that they can vote themselves money. Congress keep borrowing to fund all the spending/giving. The Fed's job has always do what you can to maintain order, which they have do a fairly good job at it. Don't forget since 2000 the national debt as almost doubled. That was a lot of pressure on price and economy that they had to adjust to handle.
If you can get Congress to stop spending like crazy, then you can fix our problems. Everything else is just a short term band aid. There is no reason for the government to be 20-25% of GDP. They produce very little, and should consume as little as possible as well.
Look at all the money given away on welfare, social security, medicaid, medicare, farm subsidies, refundable tax credits like EIC, business subsidies in the form of tax breaks, and the list goes on. You can say that social security and medicare was paid for well that maybe true now, but the first people that got benefits didn't ever pay into the system. It was a form of welfare for the elderly spun as a retirement plan. I am sure there is a lot of waste in the defense and law enforcement budgets as well.
-SWUSC |
`Everybody is ignorant. Only on different subjects.' Will Rogers
"This is the shabby secret of the welfare statists' tirades against gold. Deficit spending is simply a scheme for the "hidden" confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists' antagonism toward the gold standard." Alan Greenspan, 1966. |
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horgad
1000+ Penny Miser Member
USA
1641 Posts |
Posted - 10/27/2008 : 11:41:17
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Greenspan sold himself to the dark side. He had the choice to stand up for the truth and likely go down in a ball of flames OR to lie and game the system for everything that he could.
Greenspan knew as well as anybody the inherit failings of FIAT monetary systems and he was an advocate of gold before he sold himself out to be a mouth piece to the criminals.
"In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value."
"Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights."
-- Alan Greenspan 1966
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Ardent Listener
Administrator
USA
4841 Posts |
Posted - 10/27/2008 : 11:44:15
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quote:
Originally posted by horgad
Greenspan sold himself to the dark side. He had the choice to stand up for the truth and likely go down in a ball of flames OR to lie and game the system for everything that he could.
Greenspan knew as well as anybody the inherit failings of FIAT monetary systems and he was an advocate of gold before he sold himself out to be a mouth piece to the criminals.
"In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value."
"Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights."
-- Alan Greenspan 1966
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Excellent post! He knew better but greed and ego got the best of him. Learn from his mistakes people. |
Realcent.forumco.com disclosure. Please read.
All posts either by the members, moderators, and the administration of http://realcent.forumco.com are for your edification and amusement only. It is not the intent of realcent.forumco.com or its host to provide investment, medical, matrimonial, legal, security or tax advice and nothing posted here should be considered to be so. All rights reserved.
Think positive. |
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"Savant Idiot" Alan Greenspan
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