As I was packing boxes of books this morning, against the background of the televised bailout hearings, I came across a copy of Maestro: Greenspan's Fed and the American Boom, by Bob Woodward.
It was written in those lovely salad days prior to the November election of 2000. I picked it up on sale at Powell's last year and forgot all about it until today.
The preface seemed so innocent and hopeful. No one could have predicted just how horribly the new president would squander the surplus that landed in his lap.
Preface to Maestro
On January 20, 2001, a new president takes the oath of office. He assumes the presidency in a Greenspan era. Just as the 1992 presidential election was about fixing the economy and cutting the federal budget deficit, the 2000 election was about how to use a projected surplus of at least several trillion dollars.
The expectation, even the very definition, of the new administration -- protecting Social Security, expanding health care, improving education, revitalizing the military and cutting taxes -- will be contingent on that surplus. Whether is materializes is yet to be seen, but the inherited economic conditions for everyone -- from the next president to any citizen -- are in many respects the Greenspan dividend.
Greenspan is slated to remain chairman of the Federal Reserve until 2004... He has been frank enough to stand before the new and amazing economic circumstances that he helped create and in the end declare them a mystery. It is impossible to account fully for the continuing high growth, record employment, low inflation and high stock market.
A several-trillion dollar surplus. I can't believe the US held this opportunity in its hands just a mere eight years ago. Expanded health care, improved education... such quaint desires.
I didn't pack Maestro in a box today. It may be a depressing read, but it should provide an interesting view of recent history as it was happening.