For those conservatives who were disappointed in Alan Greenspan for comments in his best-selling memoir praising Bill Clinton and the record 1993 tax increase, the former Federal Reserve Board chairman gave hit them with a “double-whammy” when he said he could support the use of public dollars to help homeowners dealing with present subprime mortage crisis.
“Cash is available and we should use that in larger amounts, as is necessary, to solve the problems of the stress of this,” Greenspan said during an appearance on ABC-TV’s This Week program. In underscoring his view that direct financial assistance to distressed homeowners was the least harmful avenue of intervening, the man who proudly calls himself a disciple of Ayn Rand appeared to be sharply distancing himself from the Secretary of the Treasury Hank Poulson and the President. At his last news conference, the President said “we shouldn’t be using taxpayers’ money and say, okay, you made a lousy loan, therefore we’re going to subsidize you.”
But Greenspan said on ABC that “[i]t’s far less damaging to the economy to create a short-term fiscal problem , which we would, than to try to fix the prices of homes or interest rates. If you do that, it’ll drag this process out indefinitely.”
In remarks that were sure to put him at odds with the Administration, Greenspan told ABC that he felt the probability of a US recession had “moved up close to 50%.”
The White House, however, is not responding to the former Fed chairman. When I read some of Greenspan’s criticisms to Press Secretary Dana Perino at the White House this morning, she would only say that Greenspan is “an independent, private person, with a lot of opinions. We’ll leave it at that.”
Every once in a while, something new comes out of the daily gatherings of reporters at the White House.
Tuesday morning, as my colleagues were trying to pin down spokeswoman Perino on how many briefings were going to be held before Christmas, someone asked if she would be meeting with reporters on Friday. (The President has declared Monday, the day before Christmas, a federal holiday).
Perino replied that she wasn’t sure, that perhaps the White House press office would do a combination of the gaggle (early morning session) and briefing for reporters on Friday.
“That’s called a ‘griefing,’” deadpanned Ken Hermann of the Cox Newspapers, wit-in-residence of the White House press corps, as the room became convulsed in laughter.
Without missing a beat, Perino shot back: “A griefing? That’s a daily occurrence.”