“IRRESPONSIBLE”….Brad DeLong is tearing through the Paul O’Neill book and providing a public service by excerpting all the good parts for us. This evening’s excerpt is revolting:

p. 162: May 22 [2001]… Greenspan arrived at the Treasury for breakfast with O’Neill. Their secret trigger pact had come up one vote short…. “We did what we could on conditionality,” O’Neill said with momentary resignation…. “The first big battle is over, really. I think we fought well, we made our points vigorously.” Greenspan said that wasn’t enough. “Without the triggers, that tax cut is irreponsible fiscal policy,” he said in his deepest funereal tone. “Eventually, I think that will be the consensus view.”

Greenspan didn’t get the triggers he wanted, which would have linked the tax cuts to continuing surpluses, but he maintained his support for the legislation anyway and then supported yet another big tax cut a year later even though this was “irresponsible.”


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