How could a proclaimed Objectivist and a personal friend of Ayn Rand like Alan Greenspan ever think it was OK to be Chairman of something so corrupt as the Federal Reserve System?

Posted by ycandrea 4 years, 4 months ago to Philosophy
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It goes against so many principles of Objectivism, ie it is total governmental central control of our monetary structure, it is not mentioned anywhere in our U S Constitution, thus unconstitutional, the chairman is not elected so he is not accountable to anyone, and it is flies in the face of Capitalism. Does this contradictory behavior of a prominent Objectivist bother anyone but me?

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    Posted by $ Flootus5 4 years, 4 months ago
    It would appear to be the sellout of the century, in a century of sellouts.

    From Gold and Economic Freedom by Alan Greenspan in 1966 (Ayn Rand, Capitalism: The Unknown Ideal):

    "The abandonment of the gold standard made it possible for the welfare statists to use the banking system as a means to an unlimited expansion of credit. They have created paper reserves in the form of government bonds which - through a complex series of steps - the banks accept in place of tangible assets and treat as if they were an actual deposit, i.e., as the equivalent of what was formerly a deposit of gold. The holder of a government bond or of a bank deposit created by paper reserves believe he has a valid claim on a real asset. But the fact is that there are now more claims outstanding than real assets."

    How anybody that sees the nature of a scam, decry it as evil, and then fully participate in and perpetuate that very scam, is beyond me. How could one live with oneself?
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  • Posted by Herb7734 4 years, 4 months ago
    Alan Greenjeans er, Greenspan, Gave up Objectivism when he seized upon the opportunity of becoming head of Fed. It made him. He got notoriety, a beautiful wife, lots of $$ (lectures, articles, the word of God). To this day his word is highly respected, and his economic principles, while they are close to those of Objectivism, cannot be taken at face value. Since he has stepped into the dark side, his pronouncements should be viewed with skepticism.
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  • Posted by $ richrobinson 4 years, 4 months ago
    Excellent observation. I have wondered about this as well. I think the usual justification is that they can mitigate the damage being done. Similar to Education Secretaries that had previously called for the elimination of the Education Department. Total contradiction.
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  • Posted by coaldigger 4 years, 4 months ago
    I saw Greenspan commenting about Brexit and at 90, I wonder if anything he says is valuable today. I believe he thought he could make a difference but became corrupted by the power he sought to restrict. I fear that potential is a part of our human nature.

    The Fed is a central bank on steroids, grown even beyond the bounds imagined by Alexander Hamilton. Central planning sounds so good to an intellectual. Just think, if a smart person didn't control everything, the uneducated, stupid masses would influence everything!!! Free markets are not controlled but operate on the basis of the decisions of every economic entity. Opposition to market forces is futile in the long run because they don't go away, don't need to be constantly reenergized and are relentless. Trying to fight nature with monetary policy while encouraging fiscal insanity is role the Fed and they are very good at it.

    Gold is pretty much a useless metal but it is in finite supply, costs money to extract and refine and therefore puts a limit on the money supply. Paper is made from trees and the supply gets replenished daily. Discipline and restraint in printing it is too much to expect of a mere mortal, even one that sat at the right hand of Rand.
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    • Posted by lrshultis 4 years, 3 months ago
      Gold is an extremely useful metal due to its properties. Look at the Wikipedia article. I remember how electronic connectors that were not gold plated would require reconnecting quite often due to corrosion, gold's high reduction potential does not allow it to oxidize with temperature. Nearly every electronic device has some gold in it, e.g, there is $500 million worth of gold just in the worlds cell phones.
      Use in jewelry and coinage are quite useful. It is even used in medicine and chemistry.
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  • Posted by $ Dobrien 4 years, 4 months ago
    It has bothered me for 30 years .When I 1st learned about the fed it has has 20 secret shareholders by law it is a quasi- govt agency meaning it is afforded the benifits of the govt status with out the schackle of rules or edict from the govt(independent of).
    See Jekyll Island scheme.
    But it goes much further back in time.

    It was the result of a well orchestrated scheme.
    First create havoc in the commodities markets and economies with booms and busts in manipulated actions. Then promote an unacceptable solution with the fed plan as your real goal. Lie lie lie about the fact that it will end bank failures and than 15 years later every bank in the country fails. Than take away the gold make it illegal to own, force exchange to fed reserve notes.

    Upon discovery I wondered why such an important part of our country wasn't taught or complained about by the leaders.

    I don't wonder any more.
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  • Posted by impact 4 years, 4 months ago
    I had a conversation with an Objectivist economist years ago and asked about Greenspan. He commented that Greenspan sold years ago.
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  • Posted by $ MichaelAarethun 4 years, 4 months ago
    Ask Greenspan himself. He wrote about it many times. Then again also state your reasons for saying the Fed is corrupt. I 've noticed lately the comments are many the FACTS to back them up are mmmmm in the realm of well it's common knowledge. For canhdrea the benefit of refreshing minds and benefiting newcomers a little recap is definitely in order. and I think ycandrea volunteered.

    PS don't much like them myself but then objectivism means keep checking and keep testing.


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  • Posted by $ Olduglycarl 4 years, 3 months ago
    I would of thought he might have done it to improve things and maybe do some good for a change. I don't actually know how much he did or did not have any influence over.
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    • Posted by $ Daniel_Maranello 4 years, 3 months ago
      I agree, I too thought he might be able to change from within, and I think he loosely hoped he might as well. Somewhere along that path he was turned and the result was, well you know, you're living with it.
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      • Posted by $ Daniel_Maranello 4 years, 3 months ago
        An evil thought just hit me. He could well have been a Federal "Plant" to gain the confidence and learning of Ayn Rand. The Govt would surely have balked at placing a Randian in such a powerful position without good reason. Wasn't it Reagan who first appointed him, or did he just re-appoint?
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  • Posted by jdg 4 years, 4 months ago
    I don't buy the logic of the headline. The US government is very corrupt, but if I had a chance to be a congressman or President I would go for it. I just wouldn't do corrupt things. (Granted, that means I'd probably never get in, or wouldn't stay in very long, but having ethics has its costs.)

    It's plausible that the system is so corrupt that there was no chance Greenspan could clean it up, but I doubt he believed that when he took the job.

    As far as centralized control of our money structure -- I don't think it is possible to avoid that. If the Fed were abolished, it would almost certainly be replaced with a new Bank of the US.
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    • Posted by 4 years, 3 months ago
      I do not agree with your line of logic. And I think we as individuals will prove you wrong about needing a centralized/controlled monetary system. I think something like bitcoins will overturn the whole corrupt idea.
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  • Posted by LibertyBelle 4 years, 4 months ago
    I think I read that Ayn Rand discussed it with
    Greenspan before he took a job in the Federal
    government.--But then, I don't remember for sure,
    it may have been a different Federal job.
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  • Posted by rbroberg 4 years, 4 months ago
    If I wanted to bring down the Federal Reserve system, I might start with the Federal Reserve. Also, the Wikipedia article expresses this same concern (citing H. Binswanger):

    "In the early 1950s, Greenspan began an association with novelist and philosopher Ayn Rand. Greenspan was introduced to Rand by his first wife, Joan Mitchell. Rand nicknamed Greenspan "the undertaker" because of his penchant for dark clothing and reserved demeanor. Although Greenspan was initially a logical positivist, he was converted to Rand's philosophy of Objectivism by her associate Nathaniel Branden. He became one of the members of Rand's inner circle, the Ayn Rand Collective, who read Atlas Shrugged while it was being written. During the 1950s and 1960s Greenspan was a proponent of Objectivism, writing articles for Objectivist newsletters and contributing several essays for Rand's 1966 book Capitalism: The Unknown Ideal including an essay supporting the gold standard. Rand stood beside him at his 1974 swearing-in as Chair of the Council of Economic Advisers. Greenspan and Rand remained friends until her death in 1982.

    He has come under criticism from Harry Binswanger, who believes his actions while at work for the Federal Reserve and his publicly expressed opinions on other issues show abandonment of Objectivist and free market principles. When questioned in relation to this, however, he has said that in a democratic society individuals have to make compromises with each other over conflicting ideas of how money should be handled. He said he himself had to make such compromises, because he believes that "we did extremely well" without a central bank and with a gold standard. In a congressional hearing on October 23, 2008, Greenspan admitted that his free-market ideology shunning certain regulations was flawed. When asked about free markets and Rand's ideas, however, Greenspan clarified his stance on laissez faire capitalism and asserted that in a democratic society there could be no better alternative. He stated that the errors that were made stemmed not from the principle, but from the application of competitive markets in "assuming what the nature of risks would be".

    E. Ray Canterbery has chronicled Greenspan's relationship with Rand, and has concluded that the influence has had pernicious effects on Greenspan's monetary policy."

    I would add that unless you personally adhere to the Objectivist method of fact and evidence, then you are left with only assumptions. The comment from Greenspan over compromise might be considered an abandonment of Objectivist principles, or it might be considered legitimate, depending on his reasons and motivation:

    "A compromise is an adjustment of conflicting claims by mutual concessions. This means that both parties to a compromise have some valid claim and some value to offer each other. And this means that both parties agree upon some fundamental principle which serves as a base for their deal."


    "There can be no compromise on basic principles. There can be no compromise on moral issues. There can be no compromise on matters of knowledge, of truth, of rational conviction."

    Therefore, whether Greenspan erred as Binswanger has commented has to be proven as constituting a compromise on basic principles - based on the limited information provided in the Wikipedia article and the quotes from the Lexicon, that is.
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    • Posted by rbroberg 4 years, 4 months ago
      I will add that because he commented on compromise as a principle, it does appear that he put compromise as a basic principle, which would be a violation of basic principles.
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  • Posted by $ Temlakos 4 years, 4 months ago
    I always did wonder what Alan Greenspan could have been thinking, or whether he was thinking. Did he seriously imagine he could put things right at the Federal Reserve? You can't do it. The Federal Reserve is fundamentally insolvent. Does the phrase "lie, agreed-upon" suggest itself here? It does to me.
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    • Posted by lrshultis 4 years, 3 months ago
      Apparently Rand must have thought so since she stood at his side when he was sworn in. At least he did not believe that the near zero rates like Yellen's with which you can only get more debt, would make investment money available rather than driving money elsewhere.
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      • Posted by 4 years, 3 months ago
        Really? That just seems like such a contradiction to me. It is very hard for me to reconcile this with Objectivism.
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        • Posted by $ Temlakos 4 years, 3 months ago
          Rand must have suffered a failure of nerve. The only moral solution to the problem of the Federal Reserve is to abolish it. Her analysis of the Fed fell short of the mark. They who organized it, deliberately sought to build a currency on debt.
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