It's the economy, stupid.
February 2, 2008 1:07 AM Subscribe
The return of tight money fiscal conservatism?
posted by markkraft (35 comments total)
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Former Chairman of the Federal Reserve Paul Volcker endorses Barack Obama.
This could be a big deal for economic conservatives, as Volcker, though appointed by Carter
, was the Fed chairman during the Reagan administration's best economic years. (Greenspan oversaw the late 80's recession. Many wanted Volcker to replace Greenspan
at that time.)
In sharp contrast to Alan Greenspan's career, however, Volcker was openly critical of large tax cuts and deficit spending.
Volcker's Fed is widely credited with ending the United States' stagflation crisis of the 1970s by limiting the growth of the money supply. Inflation, which peaked at 13.5% in 1981, was successfully lowered to 3.2% by 1983. However, the real estate market plumetted as a result, and farmers, hurt by high interest rates, marched on Washington. In recent years, he has warned of a major upcoming currency crisis
and has criticized both Greenspan and Bernanke
for policies that encourage a bubble economy, saying "It's not fun raising interest rates."
Is bitter medicine needed for a healthy economy?