Greenspan's legacy.

Most of the time I’m not a big fan of the Nation. I think it’s marinated in the worst of the old Left, namely identity politics and trust-fund baby populism. This article on the legacy of Alan Greenspan is interesting and well-written, but misses the forest for the trees:

The prospects for political reform are gloomier. Democrats tossed away their populist credentials years ago, and with few exceptions are utterly subservient to the Fed mystique. But there’s strong, critical material for the reform-minded citizens and public officials who are not intimidated. What might they say? That the Federal Reserve has violated its basic obligations to democracy and it’s time to revise its peculiar charter. It is wrong for a government institution to sit by silently and watch a slow-motion disaster unfold for citizens, as Greenspan did. It is also wrong–both politically and economically–to ignore the legal mandate and simply serve one realm of the economy over everyone and everything else. In a democracy, government at least owes citizens fair notice–a timely warning of what it’s doing to them. The Fed never, never honors this obligation, for obvious reasons; but then neither do many politicians. That’s the basic reason democratic discourse and accountability are so necessary–the hope that somebody somewhere in the government will have the decency to tell the people.

The problem is not that the Fed isn’t living up to its mission. The problem is that average folks are too exposed to its actions. We have only a minimal social safety net, as many people in the Red States of the Gulf Coast just found out. When economic problems occur, a game of material music chairs occurs, pitting neighbor against neighbor.

Until we guarantee that people can only fall so far, and that those who work full time will have health care and educational opportunities and safe neighborhoods, there’s no point in fixing the Fed.