Is Alan Greenspan going off the deep end?
Today I read a surprising article in the Financial Times, “Greenspan backs bank nationalization,” and I couldn’t help but reading the headline over a few times to verify its accuracy. After a few minutes of being in an obsessive-compulsive-like state, I came to terms with the title, and continued on to the article, hoping for a satirical piece.
Unfortunately, there was nothing humorous about this article.
According to the Financial Times:
The US government may have to nationalise some banks on a temporary basis to fix the financial system and restore the flow of credit, Alan Greenspan, the former Federal Reserve chairman, has told the Financial Times.
In an interview, Mr Greenspan, who for decades was regarded as the high priest of laisser-faire capitalism, said nationalisation could be the least bad option left for policymakers.
”It may be necessary to temporarily nationalise some banks in order to facilitate a swift and orderly restructuring,” he said. “I understand that once in a hundred years this is what you do.”
While Greenspan has made a variety of controversial statements in the past, this one has to be, by far, the most offensive to conservatives and libertarians who once held him up on a pedestal for so many years.
Remember, Alan Greenspan was once part of “The Collective” with objectivists Ayn Rand and Leonard Peikoff, and even wrote in Rand’s newsletters and books. For those who are unfamiliar with the objectivist philosophy, one of the core tenants is the principle of pure, unregulated capitalism, where the government stays far away and let’s market forces work out any problems.
This is a philosophy that Greenspan has clung to for years, and it’s that very philosophy that made him so popular amongst the American people from administration to administration.
However, it seems that Alan Greenspan, and many in Washington (including “conservatives” like Senator Lindsey Graham) have it stuck in their minds that if the government doesn’t act now, it’ll be the end of the world.
While nobody knows what the future will hold when you over-regulate, the one thing I hear every time people like this speak isn’t the voice of rational men, but instead the voice of Wesley Mouch, one of the characters from Ayn Rand’s “Atlas Shrugged.” Most notably, from Directive 10-289:
“In the name of the general welfare,” read Wesley Mouch, “to protect the people’s security, to achieve full equality and total stability, it is decreed for the duration of the national emergency that—
“Point One. All workers, wage earners and employees of any kind whatsoever shall henceforth be attached to their jobs and shall not leave nor be dismissed nor change employment, under penalty of a term in jail. The penalty shall be determined by the Unification Board, such Board to be appointed by the Bureau of Economic Planning and National Resources. All persons reaching the age of twenty-one shall report to the Unification Board, which shall assign them to where, in its opinion, their services will best serve the interests of the nation.
“Point Two. All industrial, commercial, manufacturing and business establishments of any nature whatsoever shall henceforth remain in operation, and the owners of such establishments shall not quit nor leave nor retire, nor close, sell or transfer their business, under penalty of the nationalization of their establishment and of any and all of their property.
“Point Three. All patents and copyrights, pertaining to any devices, inventions, formulas, processes and works of any nature whatsoever, shall be turned over to the nation as a patriotic emergency gift by means of Gift Certificates to be signed voluntarily by the owners of all such patents and copyrights. The Unification Board shall then license the use of such patents and copyrights to all applicants, equally and without discrimination, for the purpose of eliminating monopolistic practices, discarding obsolete products and making the best available to the whole nation. No trademarks, brand names or copyrighted titles shall be used. Every formerly patented product shall be known by a new name and sold by all manufacturers under the same name, such name to be selected by the Unification Board. All private trademarks and brand names are hereby abolished.
“Point Four. No new devices, inventions, products, or goods of any nature whatsoever, not now on the market, shall be produced, invented, manufactured or sold after the date of this directive. The Office of Patents and Copyrights is hereby suspended.
“Point Five. Every establishment, concern, corporation or person engaged in production of any nature whatsoever shall henceforth produce the same amount of goods per year as it, they or he produced during the Basic Year, no more and no less. The year to be known as the Basic or Yardstick Year is to be the year ending on the date of this directive. Over or under production shall be fined, such fines to be determined by the Unification Board.
“Point Six. Every person of any age, sex, class or income, shall henceforth spend the same amount of money on the purchase of goods per year as he or she spent during the Basic Year, no more and no less. Over or under purchasing shall be fined, such fines to be determined by the Unification Board.
“Point Seven. All wages, prices, salaries, dividends, profits, interest rates and forms of income of any nature whatsoever, shall be frozen at their present figures, as of the date of this directive.
“Point Eight. All cases arising from and rules not specifically provided for in this directive, shall be settled and determined by the Unification Board, whose decisions will be final.”
Ayn Rand must be rolling in her grave, or chuckling “I told you so.”