The Next Alan Greenspan - New York Times

The Next Alan Greenspan - New York TimesOctober 6, 2005
The Next Alan Greenspan

The job of chairman of the Federal Reserve Board is one of the biggest and most important in Washington, and given President Bush's record of appointing his pals to fill every position from Supreme Court justice to director of the Federal Emergency Management Agency, it's small wonder there is a lot of fretting about who will be tapped to succeed Alan Greenspan.

During his news conference on Tuesday, Mr. Bush made reassuring noises aimed at global markets. "It's important that whomever I pick is viewed as an independent person from politics," the president said. "It's this independence of the Fed that gives people not only here in America, but the world, confidence."

Sounds great. But this is also the same man who said during that same news conference that he believes that Harriet Miers, his onetime personal lawyer and present White House counsel, who has never been a judge, is the most qualified of all the people in the United States to be a Supreme Court justice. The president's aides have made it clear that he wants someone at the Fed with whom he can have a rapport. That should be the last thing on the president's mind for this job, but we know from bitter experience that Mr. Bush often places feeling comfortable with an appointee above actual competence. It's just that kind of thinking that landed America with Michael Brown at FEMA and John Snow at the Treasury Department.

Mr. Snow's lackluster tenure at the Treasury, in particular, says a lot about Mr. Bush's detachment from economic policy. The hapless Mr. Snow, who thankfully is on no one's list for Fed chairman, remains completely removed from any real policy making within the administration. His biggest role at the Treasury has been as cheerleader for Mr. Bush's tax cuts and salesman for his misbegotten plan to privatize Social Security.

The four names circulating around Washington are Martin Feldstein, a Bush adviser on Social Security and an economics professor at Harvard; Glenn Hubbard, Mr. Bush's former chairman of the Council of Economic Advisers and now dean of Columbia University Business School; Lawrence Lindsey, the former director of the White House National Economic Council; and Ben Bernanke, chairman of the Council of Economic Advisers.

Two of them - Mr. Bernanke and Mr. Feldstein - come with some independent credentials. Mr. Bernanke is deeply conservative, economists say, but respected for independent thinking and not inclined to wear that conservatism on his sleeve. Mr. Feldstein has pushed for Social Security privatization, but in the past criticized deficits run up by Ronald Reagan, for whom he was working at the time, to the everlasting ire of many Republicans. That hardly makes him a shoo-in for the job, but those are exactly the independent traits that Mr. Bush should be looking for if he is indeed serious about appointing a Fed chairman who isn't politically beholden to the White House.

Hopes die hard, so we strongly encourage Mr. Bush to put his money where his mouth is this time around. This job is too important for another taste of cronyism.