Greenspan's Fed Legacy: A Look Back Between Volcker and Bernanke

Alan Greenspan, who led the U.S. Federal Reserve for nearly two decades from 1987 to 2006, is being remembered following his recent passing. His time at the helm followed Paul Volcker, credited with curbing high inflation in the late 1970s and early 1980s, and preceded Ben Bernanke, who navigated the 2008 subprime mortgage crisis.

The article poses the question of how future historians will assess Greenspan's significant period as head of the central bank. It delves into economic thought, referencing figures like Henry Dunning Macleod, who studied financial literature and critiqued classical economists, and Frederick August von Hayek, who recognized Macleod's contributions.

To explore Greenspan's legacy, the piece considers the perspectives offered in the autobiographies of the Fed chairs themselves: Greenspan's "The Age of Turbulence" (2007), Bernanke's "The Courage to Act" (2015), and Volcker's "Keeping At It" (2018). The author notes that while autobiographies can exaggerate, they generally offer truthful accounts, a point analyzed by economists James M. Buchanan and Robert D. Tollison.

Greenspan's tenure is characterized as one of apparent luck, particularly in contrast to Volcker's decisive action against inflation. While Volcker faced the challenge of rising prices, Greenspan presided over a period that, in hindsight, seems to have been more fortunate, though the long-term consequences of his policies remain a subject for historical evaluation.