I wouldn't go as far as to say his whole worldview is kaput, but it does cast a lot of doubt on the assertion that the market will fix everything if we just stop regulating it.

Nah, his whole worldview is kaput.

Sounds like a socialist to me.

For a Rand acolyte, Greenspan is sounding awfully consequentialist. Isn't a free, unregulated market a good in and of itself, regardless of whether certain well-designed constraints might contribute to the common good?

Ho HO Androscoggin - very clever!  We don't need no stinking common good.

As a rabid consequentialist myself, I always welcome a new members.

Wow.  This is one of the most gratifying things I have read in ages.  

Reality-based economics: 1

Free-market dogma: 0

Too bad, though, that it took Greenspan 40 years to start getting over his Atlas Shrugged infatuation from his youth -- it's a bit late to do any of us any good.  

Androscoggin:  How is an unregulated market a good in and of itself?

The plan was great -- dammit there was and is nothing wrong with the plan!!  It's just that it didn't produce the requried result.  Stop hounding me!

Awesome.

Greenspan says "...I have been going for 40 years or more with very considerable evidence that it was working exceptionally well.” Meaning he read the Fountainhead and Atlas Shrugged and fell in love with Ayn Rand and her body politic of selfishness. He must have fawned over her staunch stance against totalitarianism and non-stop praise of unfettered free-market Capitalism as the be-all and end-all of economic theories.

“I made a mistake in presuming that the self-interests of organizations, specifically banks and others, were such as that they were best capable of protecting their own shareholders and their equity in the firms,” Goddamn right. Anyone who actually thinks pure capitalism has  one ounce of altruism deludes themselves. The self-interests of protecting shareholders and their equity in the firms ends at the ends of the noses of the boards and CEOs that ran these things into the ground as they tripped over themselves on the way to the proverbial bank.

The problem with Greenspan is that he can't very well man-up and take responsibility for trying to implement his interpretation of the ideal laissez-faire market with a dash of Ayn here and a dash of Rand there. It's one thing to be influenced by a book and quite another to take a fictive piece of work and try to make it a reality. This is the closest we will ever get to an apology from this man.

I was listening to some of the testimony. Dennis Kucinich read a long list of Greenspan pronouncements in recent years that have proven wildly off base, and pressed him to answer,when did he realize that there was a problem in the housing market. Greenspan, after trying to wiggle out of it, stated that he recognized problems "in early 2006, retrospectively."

Greenspan's going soft in his old age.

A true free-market proponent welcomes the future, regardless of how much of his own piss blows back on his legs.

No reason Greenspan's ideology should be species-specific. Why, perhaps at this very moment a pandemaniacal drug-resistant pathogen is evolving furiously in some corner gym tile grout or intensive care unit catheter or slaughterhouse killing floor, ready to leap to humanity and send billions of us almost overnight into screaming excruciating terrifying eternal oblivion. And perhaps a handful of unlucky survivors will remain, to grow more insane by the minute.

There's your free market economy, right there: one uber-dominant race, having enjoyed just a swell run, really a beauty, succumbing to its own gluttony and the humble yet shockingly effective machinations (say: mucus membranes breached, cells invaded, internal bleeding triggered, horrific pain, vomiting, delirium, coma, death) of its opportunistic successor. Same as it ever was.

Suck it up, Greenspan. You wanted it, you got it. And heed Joe Walsh: "I lock the doors, in case I'm attacked."

To clarify, my point above was: Greenspan loves Rand. Rand thought constraints on free markets were immoral per se, regardless of any benefits they might deliver to society as a whole.

And yet Greenspan seems to be suggesting here that his support for laissez faire is conditioned on its securing certain outcomes (prosperity, stability, whatever). Which makes him look suspiciously consequentialist. A real Randian would look at problems in the CDS market and either claim that they were somehow caused by collectivism and altruism, or would say: chaos is merely the price of freedom (probably using creepier language).

My point wasn't to endorse Rand's outlook, which I think is bizarre. (I'm neither an "objectivist" nor a Kantian or deontologist or whatever the word is). It was to point out a certain inconsistency in Greenspan's own worldview -- the sort of inconsistency that I think is virtually inevitable if you claim not to care about outcomes.

Jeez. Greenspan signed off on Keating and Lincoln Financial and saw market failure, yet he still didn't learn his lesson?

lib ref, I've always thought of myself as an inconsequentialist, personally.

Joe Walsh also said in the same song, "...life's been good to me so far..."

Avoid simple explanations. Greenspan's admission is indeed breathtaking, but at the end of the day this still looks familiar--as Milton Friedman pointed out, people are more careful with their own money than they are with other people's money. This is no less true for hedgefund managers than for commissars.

Greenspan "made a desert and called it peace"  oops wrong saying . I mean Greenspan is blaming the sub-prime lending crisis on "overeager investors." Aha so It's that damned free market that caused it all! Now did such errors in judgment more likely result from hundreds of thousands of people independently making the same, poor decisions, or were they more likely misled by a common signal emanating from the state?

Androscoggin:  Ah, I see; sorry for the confusion.

“I have found a flaw."

And here I was thinking that the global financial meltdown revealed the flaw.

Greenspan has been spouting ideological drivel for years and pretending that it is economics.  The world has not proven that his grasp of economics is unsound because what he was preaching was never genuinely founded in economics.  He was always nothing more than a good front-man for the Tories.  It is his ideology, the ideology of Bush and the entire conservative "movement," that has been undone by reality, not that I expect many of them to take notice.  Like the good Stalinists that they are, they will continue to ignore reality and claim that their ideology is sound, just not implemented properly or thoroughly enough and undermined at every turn by traitors.

"There are some things that markets do well and some things that markets do poorly or not at all.  We must learn to tell the difference."  Peter O. Steiner, Professor of Economics and Law, Univ. of Michigan.

Markets are a human invention.  Like any human invention, the do some things well and some things poorly or not at all.  The worship of markets as either an end unto themselves or as perfect unto themselves and hence not subject to or in need of any control or oversight or as the solution to everything is on a par with the worship of clay idols -- stupid in the extreme.  Greenspan does not have feet of clay; he has brains of clay.

The other day on C-SPAN's Washington Journal when they were discussing the bailout, a caller suggested that we take a portion of that $810 billion, $350 million to be precise, and give every American $1 million.

What a fabulous suggestion, I can't think of anything that would help our economy more, because the next day everybody would be out shopping, of course they would have difficulty getting served because a huge swath of people wouldn't show up for work the next day, but so what. Who deserves a taxpayer-funded bailout more than I do in my own damn country, not nobody the way I see it.

Not to be offering up tactical suggestions to the enemy, but John McCain could probably still win the election, if he told Americans that he was going to take just 4% of that money and give it directly to us.  Of course John would never do that because he and his corporate masters and the lobbyists in his campaign are working hard to convince the Republican sucker-base that they should settle for a few measly dollars of a tax cut.  Obviously they believe that they -- the wealthy elite who are devoid of moral or ethical responsibility -- should have all the money and all the power in America, and WE THE PEOPLE should spend our lives waiting on and catering to their bloated asses, and settle for the scraps they happen to throw our way.  

A whole lot of people made a whole lot of money throughout the Reagan/Bush/Clinton/Bush decades.  I watched while the people I worked for got rich off of my labor, and gave me food money in return for the wealth I created for them.  Then they tossed me aside like an old candy bar wrapper, easily replaced by the next new cog/slave in their machine.  So now I want mine. I want MY FUCKING MONEY now, while Uncle Sam is still paying off.  

That caller seems to have a bit of trouble with math.

$350 billion/ 300 million people =$1000+/person

Unless he meant $350 million; then everyone gets a crisp new dollar bill. Don't spend it all in one place!

Except that $350 million is about $1 per person, and $350 billion is $1000 per person. A thousand bucks is nice, but not that different from the "stimulus" package that W gave us last April.

Aaron, aside from the faulty math, this is the Social Credit idea - about fifty years ago a crank populist part in Canada had this idea of printing money and handing it out to people.  Let's just say it's been tried elsewhere and the result is Zimbabwe.