is now passed away, and his internet site has been discontinued,
economist Pierre Rinfret published some rather pithy
descriptions of the people whom he
had known during his long career as economist in the
halls of power of the US government. I was reminded of that today by the video from Michael Hudson which is included
at the bottom.
Pierre Rinfret was a very good economist
with a long and successful
career, but made a fairly
awful politician to say the least. He was famous for telling the economic truth, even when those
in power did not want to hear it. And he was outspoken,
too much so for the pampered princes. He
himself was often naive I think, in believing that the truth would prevail even among those
who were determined not to see it, and that those to whom he had been loyal would repay him
in kind. He was 'set up'
to take a loss in his run for governor
of NY. But that was just politics and he had made quite
a few enemies, especially amongst the emerging neo-conservatives who took control of his beloved Republican Party.
I had the opportunity to discuss quite a few things with him
before he died, and I found that his information often tracked with things that
I knew. We differed greatly on some subjects, especially when it came to certain loyalties he held to faithfully,
and on the role of the US dollar as reserve currency going forward. But I welcomed his perspective given the differences in our age and his
direct experience with so many of the famous and with the Great Depression. He was an
intelligent and often passionate
man with a good heart.
Here is his stated reason
for producing his site.
"I have come to realize that the vast majority of decent, wonderful people, have no idea
how they are being hoodwinked day in and day out by the scum of this world. We are lied to, misled, bamboozled, suckered, cheated, misrepresented, conned, manipulated and royally screwed!
They take us to the cleaners day in and day out in every way possible. We, the people, pay the price of their cheating, their folly, their lying and their sheer stupidity."
Although he discussed a wide range of subjects on his website, and had a wonderful section on the Great Depression,
what had made it a bit controversial was what he
had called 'People
I Knew' that remains only in the internet
archives now. We have
to keep in mind that what he
says are one man's opinions, and everyone is subjective whether they realize it or not, especially in their opinions of
other people. So I try to
concentrate on the facts
in what people say, and take the opinions with a grain
His description of Alan Greenspan was very similar
to the description provided here
by Michael Hudson in the video interview below.
Here is what Pierre had to say about his impressions of
"I first met Alan Greenspan in
1948 when we both attended the New York University School of Commerce, Accounts and Finance. At that time I was the senior fellow in the Economics Department. The run in was a forerunner of his behavior throughout his entire life. But I am not going to bore you with the gruesome details.I have, therefore, known Dr. Greenspan for more than
50 years and I must say that he has always
underwhelmed me! I was in
the class of NYU before him
and our paths crossed innumerable times in our professional careers.
I debated him on many an occasion, we shared many speaking
platforms together, we both worked
for Richard Nixon in the 1968 and 1972 campaigns as
well as in between , we both
graduated from NYU undergraduate school and Graduate School and we both ran
our own economic and financial
consulting businesses. In addition we played golf together more than once with mutual friends.
One of the absolute lies about him
is that he retired from
his consulting business a wealthy
man. Absolutely and totally
untrue. When he closed down his economic consulting
business to go on the Board of the Federal Reserve he did so because
he had no clients left and the business was going under.We even went so
far as to try and hire some of his former employees only to find out he had
none for the 6 months prior
to his closing. When he closed
down he did not have a single client left on a retainer basis. His only source of income was his speech making. As a speaker he had to be the ultimate bore exceeded only by Paul McCracken about who Richard Nixon told me on many an occasion "When he talks MEDGO" meaning "my eyes doth glaze
He had a horrible record on forecasting
the American economy. He missed
calling, in advance, every single recession in the entire postwar period with only
one exception. He neither called
recessions nor expansions
for the very simple reason
that he has never been one to stick his
neck out. In American industry they
don't pay consultants for
Pablum or for saying what everybody else does! And that is what
he has always served up: Pablum...
The driving force that may push Greenspan more than anyone or himself realizes is that
he graduated from the "Bronx High School
of Science" and that his
peers included one Henry
Kissinger and other famous
of about his age. A classmate of his once said to me that Alan had to prove to them that he
was as smart as they were...
I once called him a political hack in a speech before the Chamber of Commerce
in Chicago and I did not retract
that statement then or now."
The problem is not that Alan Greenspan himself may have been 'a hack' who was willing
to say and do whatever
power politics required.
There is certainly evidence that he was surrounded
by secrecy, and a bit of mythology
regarding his infallible judgement that was promoted
at the time by the popular
The real problem is that being a hack has become fashionable, almost de rigueur, and public policy decisions are being regularly distorted by hacks, economic
and otherwise, who are willing to say and do almost anything to curry favor from power, but often dress those
political opinions up as science.
And they are defended by other economists and media
people and talking heads who also seek
to curry favor from
power, in a pyramid of intellectual
corruption. I have seen this
contagion destroy very large companies,
and apparently that works for countries as well.
This is of course nothing
new. I have previously told
you about the book and testimony
of A. Newton Plummer, a Wall Street 'public
relations man,' who had testified to Congress, most effectively with a suitcase full of cancelled checks in hand, about
the widespread payoffs to
almost every financial pundit on the Street,
that helped to fuel the
rampant fraud that led to the Great Crash of 1929. Financial collapses like this that
are not due to natural causes are always founded in fraud, and if you dig a bit, you will find that
there are individuals behind it. It is not some random
madness, but a weakness
of character, a perennial
gullibility, a feeling that
'everyone is doing it,' that
seems to be exploited periodically by heartless individuals.
Pierre was of the opinion that
not everyone is bad, and he was
no misanthrope as you can
tell from his first quotation above. But there is a
minority of people who will say or do almost anything to get ahead, and who obsessive seek money and
In certain periods of history
they seem to become more socially
acceptable, and less furtive. And by example and influence they can corrupt the weak, who are many. I had come to a similar conclusion based on personal observation, and the theory
of the white collar sociopath
as a foil to the romantic notion of the efficient markets hypothesis and the natural goodness of markets.
People are corruptible, some more readily than others, and there are those who are a bad sort, a bad seed if you will,
who will corrupt them if the system and the people do not actively
oppose it. It seems fairly simple and common sense when said
that way, but if you apply it
to certain financial systems
and their underlying assumptions, you see their weaknesses
exposed. Corruption hides,
and so you look for those who operate
in the dark. Where things seem to come mysteriously rushed out of nowhere with little factual basis behind them, and don't seem to make sense, then
they probably don't. This holds true for the Iraq war, and the bank bailouts, MF Global, and
the financial and commodity
market scandals that are yet to be revealed. At the end of the day, this is just
good systems engineering.
These are dangerous times
of course, because when a
people, a nation, have bought into
a lie, occasionally they decide that they
have gone too far to return, and follow their deceits, straight into a living
hell. This is how even an educated and civilized people can, on the whole, gradually become torturers and monsters, often without even realizing it.
can make you believe absurdities,
can make you commit atrocities."
So we see
times when corruption seems
more prevalent than others. I think we are in such a time now, as a legacy to the embracing of the 'greed is good' mentality in the
1980's. Where it will take us, who can say.
But it seems fairly clear that the economic system can only be
restored to some working order through reform, transparency, and accountability.
Michael Hudson: Firing Alan Greenspan