If Alan Greenspan got the economy wrong, what chance was there for the rest of us? His aura as a financial wiz outshone dissenting economists who questioned the novel financing schemes inflating the housing market (those dissenters included colleagues at the Federal Reserve, where he was chairman from 1987 to 2006). Though there were multiple warning signs, Greenspan was surpri (...)
May 21, 2010
Books
But Greenspan Said So
How Markets FailThe Logic of Economic CalamitiesJohn CassidyFarrar, Straus and Giroux, $28, 390 pp.
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Mike Evans: Cassidy give a convincing account of how we rationalized our way into the system you well describe. Worth a read.
Perhaps the a priori designation of markets as our salvation might finally be challenged. Starting with Adam Smith, a whole host of prognisticators calling themselves 'economists' have espoused the 'invisible hand' as the best mechanism for allocating scarce resources among alternative uses. This deus ex machina approach simply abdicates all human responsibility for bad and inhumane outcomes. Thus we have reasonable limits and regulations, tax policies with credits and incentives, and a democratic government to oversee our task of working toward a common good. Unfettered markets are not up to any of these tasks and their defenders would appear to have personal and profit-making motives for advocating on their behalf. Today, my own financial future is not in my hands as a small time investor but in the hands of those who have the economic and political power to manipulate and control the so-called 'free markets.'