Can Get Fooled Again

Our president once made the following statement:

“There’s an old saying in Tennessee—I know it’s in Texas, probably in Tennessee—that says, fool me once, shame on—shame on you. Fool me—you can’t get fooled again.”

If only our current Fed Chairman had taken those sage words to heart:

Mr. Greenspan’s comments, in testimony to the Senate Banking Committee, gave Mr. Bush some support on the private accounts component of his approach to Social Security, but also gave ammunition to Democrats who have asserted that establishing investment accounts is, among other problems, unaffordable.

“I think the existing structure is not working,” Mr. Greenspan told members of the committee, declaring that private accounts would be “a good thing to do” but urging lawmakers to “start out slowly” and be wary about the trillions of dollars in additional federal borrowing that might be necessary.

“If you’re going to move to private accounts, which I approve of, I think you have to do it in a cautious, gradual way,” he said.

The comments were reminiscent of those Mr. Greenspan made just over four years ago, when he endorsed Mr. Bush’s goal of cutting taxes on the theory that the government should gradually reduce its budget surpluses.

For a more cynical take on Greenspan, see this post. For a more informative take, see this from The Century Foundation.