The Greenspan Succession (Krugman)

[papau]

http://www.nytimes.com/2005/01/25/opinion/25krugman.html?oref=login

-ED COLUMNIST
The Greenspan Succession
By PAUL KRUGMAN

lan Greenspan is expected to retire next year. The Bush administration, because of its nature, will have a hard time finding a successor.

One Fed chairman famously described his job as being to "take away the punch bowl just when the party gets going." Bond and currency markets want monetary policy in the hands of someone who will say no to politicians. When a country's central banker is suspected of having insufficient spine, the result is higher interest rates and a weaker currency.

Today it's even more crucial than usual that the Fed chairman have the markets' trust. The United States is running record budget and trade deficits, and the foreigners we depend on to cover those deficits are losing faith. According to yesterday's Financial Times, central banks around the world have already started shifting into euros. If Mr. Greenspan is replaced with someone who looks like a partisan hack, capital will rush to the exits, the dollar will plunge, and interest rates will soar.

Yet President Bush, as you may have noticed, only appoints yes-men (or yes-women). This is most obvious on the national security front, but it's equally true with regard to economic policy. The current Treasury secretary has no obvious qualifications other than loyalty. The new head of the National Economic Council apparently got the job because he is a Bush classmate and fund-raiser.<snip>

[phantom power]

1. Maybe that's just what we need. For our foreign debt holders to

pull the damn plug on us for a while. It might be a good way to remind America that we aren't nearly as superior and "independent" as we like to tell ourselves that we are.

On the other hand, the human toll of that kind of currency collapse would be terrible. It sure would be nice if we could come to our senses without some kind of economic disaster to wake us all up.

[Selatius]

2. Bush probably won't appoint another yes-man here, imho

Cheney is not that dumb; he'll convince Bush to appoint someone who isn't afraid to disagree with Bush Co. on monetary policy.

[papau]

4. I believe Cheney is- sadly - that stupid.-Yes men are neede to restructure

America in the corporate freedom way.

[ixion]

5. I wouldn't bank on that, as it were

The maladministration has never once appointed someone to a post -- ANY POST -- that could be called non-partisan. The only thing these thugs know how to do is appoint a felon from their ranks.

[EC]

3. They"ll push for Snow...n/t