
Alan Greenspan: Economy will 'fade' dramatically because of entitlement burden - hhs
https://www.cnbc.com/2019/04/12/alan-greenspan-says-economy-will-start-to-fade-out-because-of-growing-us-entitlement-burden.html
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efficax
Why would anyone listen to greenspan after 2008? A dotty old randian who
doesn't know what he thinks he knows

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dmfdmf
Greenspam was associated with Rand at least through 1977 when he was chairman
of Ford's Council of Economic Advisors, a position that Rand explicitly
approved. She died in 1982 and Greenspam was appointed to the Fed in 1987 so
she never had a chance to comment on that position.

However, based on Rand's writings on ethics and capitalism it would be immoral
to accept the Fed chairmanship unless you had an explicit charter to shut it
down which was obviously not the case for Greenspam. Rand would have denounced
Greenspam in no uncertain terms but she was dead.

Accepting the Fed position was an explicit repudiation of Rand's philosophy
and views on capitalism regardless of Greenspam's prior association with Rand.
It was also an implicit repudiation of the articles (especially the article on
gold) that he wrote in Rand's anthology "Capitalism: The Unknown Ideal" in
which Greenspam authored three articles; "Antitrust", "Gold and Economic
Freedom", and "The Assault on Integrity". He is no more a "randian" than my
mom, though he is dotty and old.

Greenspam would have been wise to read and heed an article written also in
Rand's book on capitalism; "The Anatomy of Compromise" in which she explains
the principle of Sanction. Rand wrote;

> In any collaboration between two men (or two groups) who hold _different_
> basic principles, it is the more evil or irrational one who wins.

Greenspan chose to collaborate with dishonest bankers, currency cranks (in the
Fed) and bureaucrats (in the bank regulators) who wanted make it possible to
"somehow" inflate the currency, give loans to the unqualified and to back
quasi-private debt (Fannie Mae and Freddie Mac) with govt guarantees all
without consequences. He thus set the stage for the 2008 mortgage banking
crisis.

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cmurf
Ok so maybe we should axe FICA taxes for employer and employee and just borrow
it by issuing more treasury securities? I mean, he's not complaining about
unfunded military expenses that are paid for exclusively by borrowing. If
military adventures had their own tax, maybe we'd be thinking a little more
clearly about our priorities?

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apo
> “Without any major change in entitlements, entitlements are going to rise.
> Why? Because the population is aging. There’s no way to reverse that, and
> the politics of it are awful, as you well know,” Greenspan added.

Funny that he'd lay the blame on entitlements when it could just as easily be
laid on out-of-control military spending with the Terrorism boogeyman cracking
the whip. Why, because neither the Republicans nor Democrats can keep their
entitled noses out of other countries' (or their own citizens') business.
There's no way to reverse that and the politics are truly awful.

The bigger problem is that the American people have collectively decided that
debt simply doesn't matter. Congress and the President pass budgets with eye-
popping deficits. The Tea Party and its calls for fiscal restraint are as good
as dead. Sanders, Warren, and the left wing of the Democratic party are on the
ascendency and will do everything they can to implement programs with high
price tags. Republicans will block any attempt to raise taxes to pay for it
all. The Federal Reserve has decided to pull the plug on quantitative
tightening, making it that much easier for Congress to balloon the national
debt.

Greenspan bears major responsibility for this mess. His complicity in letting
asset bubbles inflate well beyond control, and his rush to paper over the
resulting mess leads us where we are today. A financial house of mirrors where
bullshit passes for money and only the poor get hurt for their financial
stupidity.

~~~
manfredo
> Funny that he'd lay the blame on entitlements when it could just as easily
> be laid on out-of-control military spending with the Terrorism boogeyman
> cracking the whip.

Out of control military spending? As a percentage of GDP military spending has
had an overall downward trend since the Korean War. Measuring in terms of
dollars does not account for overall growth of the economy. There's nothing
"out of control" about US military spending.

[https://images.app.goo.gl/g1j2vkJz8UpdHcvU9](https://images.app.goo.gl/g1j2vkJz8UpdHcvU9)

~~~
peisistratos
The chart is incorrect because it does not take into account hundreds of
billions in veteran's benefits, nor interest paid on past military spending
(and as there is a budget deficit, the current year's military deficit
spending will be tacked onto next year's military debt interest).

~~~
manfredo
This cuts both ways, the spending on veterans post Korean War, WWII, and the
Vietnam War was probably very large as well. The point is the overall trend is
down. The economic burden of the US defense budget is decreasing, not
increasing.

Our military spending as a percentage of GDP has dropped by roughly 4x since
the 1960s. From around 12% to around 4%. In no way can a reasonable person
describe our military spending as "out of control".

