Heartland grumblings about Greenspan
Alan Greenspan is a walking almanac of economic statistics. The Federal Reserve chairman probably knows what company makes cardboard boxes in Phoenix, how many trucks the United Parcel Service can load in an hour, and how many workers earned overtime in Detroit making the hottest SUV.
But does he know that some 135 residents of Dixville Notch, N.H., are nervous about losing their jobs, since the medical-examination gloves they make can be produced more cheaply elsewhere? Or that some residents in Burlington, Vt., are paying half their incomes to keep a roof over their head? Or that many Vermonters are worried about losing their pensions?
In case any of this has escaped Mr. Greenspan's eye, Vermont Rep. Bernard Sanders (I) is inviting the nation's top banker to visit his state "to meet real people." The invitation came this week during a House Financial Services Committee hearing, in which Greenspan said the economy is going to improve later this year. "I just don't know what world he's living in," says Mr. Sanders in an interview, as he reels off the names of companies closing in his state.
Some people say Greenspan's world doesn't go beyond official Washington: Chauffeurs to work. Dinners with the chairmen of the boards. Guards to make the workplace a crime-free fortress. And no pesky e-mails, since the Fed doesn't give out e-mail addresses. "By definition, he doesn't live in the world we live in," says Mark Zandi of Economy.com.
But some Fed watchers question whether it's worth it for Greenspan to spend time on the sidewalks. "I'm not sure he'd learn much by venturing out to talk to homeless people," says Lyle Gramley, a former Fed governor.
Instead, the Fed chairman talks to a wide variety of business leaders, heads of state, and fellow bankers, including the presidents of the 12 Federal Reserve banks. Labor-union and community leaders sometimes serve on the boards of these banks. "There is an opportunity for a cross section of views to be heard," says Paul Kasriel, a former staff member of the Chicago Federal Reserve Bank.
But just because the Fed chairman doesn't visit soup kitchens, that doesn't mean he is not aware of his actions, says Mr. Gramley. He recalls that when he served with Chairman Paul Volcker, interest rates were rising sharply to counter a bout of inflation. "You don't make decisions without knowing what you are doing," he says. "People are being put out of work, businesses are failing."
Still, Sanders thinks Greenspan needs to broaden his horizons to determine what's in the best interest of the country. "He is separated and isolated from the middle class, and his policies represent that," says the congressman, who is especially incensed that Greenspan is not overly concerned about the loss of manufacturing jobs. "He said, 'It's not important where our products are made just so long as people can continue to buy them.' "
If Sanders is correct that Greenspan is isolated, in the spirit of David Letterman, here's a list of 10 things Greenspan can do to get in touch with America:
10. Get a tattoo that reads, "I'm Fed Up Too."
9. Eat once a week at a Luby's cafeteria during the early-bird special.
8. Invite the Rev. Al Sharpton over for lunch.
7. Try answering some help-wanted ads.
6. Hold the meeting to set interest rates at a truck stop.
5. Take the Metro to work.
4. Go to a Phish concert.
3. Get a second job at McDonald's.
2. Hold a press conference.
1. Stop being so exuberant about the economy.