Greenspan on Out-of-Control Money and the Future of U.S. Capitalism

  • Paul Burkett
Keywords: Political Economy


Federal Reserve pronouncements usually yield little insight into the real functions and limitations of monetary policy or into ruling-class thinking on the prospects for U.S. capitalism. During financial crises, the Fed may affirm its "readiness as a source of liquidity to support the economic and financial system," as Chairman Alan Greenspan put it following the October 1987 crash. But even such emergency bulletins are more designed to allay public fears and boost market confidence than to inform citizens about the inner workings of the system and Fed policy. They are somewhat akin to the assurances of "no danger to the public" routinely churned out by the authorities after nuclear-reactor accidents. In more normal times, Fed statements utilize the jargons of market analysts and neoclassical economists which have grown increasingly similar in the recent years of exploding finance and stagnating productive activity. This reinforces the aura of elite expertise and control separating Fed personnel and operations from the general public.