Alan Greenspan Quotes
Social spending is going up at a tremendous rate. The irony is that it went up even faster during the “prudent” years of Republican administration more so than it did under the “spendthrift” Democratic administrations….
At the time, the Republicans cast themselves as the party of prudent and responsible budgeting and the Democrats as the party of spending, especially on social services. The reality was just the reverse for a period of time, when it was the Clinton Democratic Administration that had a balanced budget and a surplus as opposed to the Republican administrations of high deficits and even greater social spending than the Democrats. Greenspan was himself a Republican which added a little sting to the quotation.
Alan Greenspan, Chairman, Federal Reserve Board, Interview, C-SPAN, The Newsroom, November 16, 2012
Sourced by: Eigen's Political and Historical Quotations
Although the Professor was often right about this technique, at the time he made this statement, the Clinton administration was actually cutting spending and using much of the revenue to pay for the deficit—just the opposite of what the Professor was worried about. It was successful and the deficit was eliminated and surpluses were projected. However the succeeding administration more closely followed the professor’s pattern and increased spending enormously for serious needs, but also cut taxes, so that we went during the Bush administration from the largest projected surplus in American history to the greatest deficit in American history.
In 1964 the treasury secretary asked the president how to sell the proposed budget to Congress:
After many years of deficit financing, Clinton finally produced a balanced budget and together with his Secretary, of the Treasury, Robert Rubin, actually developed an economy which was producing a huge annual surplus that would soon eliminate the national debt. However, when George W. Bush replaced Clinton after two terms, Bush was unable to manage the budget any better than the other aspects of the Presidency. He cut taxes dramatically and even after it was clear that the Clinton surplus was squandered, he continued tax reductions and even increased them while increasing government spending creating the biggest government in history and went from our largest surplus to our largest deficit in his 8 years.
Alan Greenspan is an American economist who served five terms as the 13th Chair of the Federal Reserve of the United States from 1987 to 2006. He works as a private adviser and provides consulting for firms through his company, Greenspan Associates LLC. First appointed Federal Reserve chairman by President Ronald Reagan in August 1987, he was reappointed at successive four-year intervals until retiring on January 31, 2006, after the second-longest tenure in the position (behind William McChesney Martin).
