WASHINGTON — For years, a Congressional hearing with Alan Greenspan was a marquee event. Lawmakers doted on him as an economic sage. Markets jumped up or down depending on what he said. Politicians in both parties wanted the maestro on their side.
But on Thursday, almost three years after stepping down as chairman of the Federal Reserve, a humbled Mr. Greenspan admitted that he had put too much faith in the self-correcting power of free markets and had failed to anticipate the self-destructive power of wanton mortgage lending.
"Those of us who have looked to the self-interest of lending institutions to protect shareholders' equity [versus sustainability], myself included, are in a state of shocked disbelief," he told the House Committee on Oversight and Government Reform.
Of course, "markets" are hardly free if they are subject to a currency which can only multiply indebtedness into terminal sums of debt. In fact all along the way to terminal failure, true producers are deprived to ever greater degrees of just compensation for their production, until of course they are dispossessed even of the opportunity and their right to produce.
But the purported humility therefore is a lie. Greenspan isn't about to support rectifying the system of its inherent faults. On the contrary, while he feigns apology, he means to ensure the perpetuation of that unjust system. Every president since and including Gerald Ford was offered the opportunity and way to resolve these issues via mathematically perfected economy™. None answered, and particularly Mr. Greenspan, not only because they all knew then that they were wrong, but because despite being wrong, they intended instead to perpetuate the irreversible multiplication of that unearned taking.
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