Tom Harkin: “I wanted to read a few of the lines from this editorial. We may have an exciting new contrary indicator: Alan…”

“I wanted to read a few of the lines from this editorial. We may have an exciting new contrary indicator: Alan Greenspan's predictions. Our search of the record has never found him to be right about what the economy, inflation or interest rates were going to do. We could go back further back, but let's begin with a much noted-1981 speech. As a private and well-connected economist, Greenspan declared that inflation would not decline any time soon. Whoops, inflation was about to drop from 12 percent a year down to 4 percent. In 1982 he wrote a letter of commendation for Charles Keating. He also made an impassioned plea to Congress, asking for more freedom for the savings and loan industry. Years later, the S&L's went bust at great cost to the taxpayers. Keating wound up in jail. The same year, Mr. Greenspan's published economic forecasts said bond yields would fall one-quarter of a percent from the previous year-end level. In fact, they fell 3 percent. But the drop in inflation was only temporary, he argued in May of 1983. The extraordinary Volcker-induced inflation calm, he insisted, was about to end. In fact, inflation stayed quite steady at 4 percent through 1987 and the end of the Volcker regime. Also in 1983, Mr. Greenspan said long-term interest rates would increase 20 basis points. This proved to be his best forecast ever: Rates did rise--but by 1 percent, not the meager .2 percent that he predicted.”