For three months, Federal Reserve Chairman Alan Greenspan has been driving leftists into a fit while he drives them out of the cheap rhetoric business. For nearly two years he has been optimistic about the American economy and its stimulation through tax relief. In February of this year, Greenspan stepped into the Beltway gridiron while donning a jersey that looked less like black-and-white splint than a red, white and blue scheme — lettered "RNC." Private accounts as part of a Social Security overhaul? Why, of course, said the good chairman, adding two weeks later that time was of the essence. Having now decked and pinned the Democratic Party's contention — no individual control, no changes for decades — Greenspan felt obliged to go one more and push for tax code simplification. Where the edges of ataraxia and catatonia meet — when partisans will exhaust themselves — is hard to say. But Greenspan doesn't mind pushing the left towards that intellectual event horizon, having offered President Bush another pair of gifts this week. On oil:
Soothing words from Alan Greenspan lifted stocks Tuesday as the Federal Reserve chairman reassured investors that the recent rise in oil prices is unlikely to damage the economy.
A gaggle of journalists have chopped up Greenspan's announcement like one would say Abraham Lincoln intoned "Four fathers brought a portion of unfinished work" at Gettysburg, more or less — but when Wall Street catches on, which it did, chances are the public will, too.
Then Greenspan furrowed his brow at Fannie Mae and Freddie Mac, Uncle Sam's two-headed mortgage colossus, which big-state types consider as dear as FDR's legacy in welfare:
Greenspan said any crisis with the two mortgage companies — known as Government-Sponsored Enterprises — could have a disastrous spillover effect on the banking system."If we fail to strengthen GSE regulation, we increase the possibility of insolvency and crisis," he said in testimony to the Senate Banking, Housing and Urban Affairs Committee. Fannie and Freddie have vastly increased their control of the residential mortgages, jumping from about $750 billion worth to almost $4 trillion in just a few years. That's about 45 percent of the total market, a percentage that is too high in Greenspan's view and too great a risk for the whole banking system.
"We put at risk our ability to preserve safe and sound financial markets in the Unites States — a key ingredient of support for homeownership," Greenspan said.
Oh, to have heard the concurrent cries of respective joy and dirty oaths. If life were a film, think of this split-screen sequence: in the offices of the Wall Street Journal, Alan Greenspan's bronze bust placed on a mantle; and in the offices of the Democratic National Committee, the Federal Reserve Chairman's picture — complete with horns, swirly eyes and goatee — taped to the lounge dartboard, right below a perforated mug of George W. Bush.