Murray N. Rothbard, Alan Greenspan: A Minority Report

Murray N. Rothbard’s polemical article, originally published in 1987 and republished in 2016, challenges the acclaim surrounding Alan Greenspan’s appointment as Federal Reserve chairman. Its central claim is that Greenspan’s reputation as a defender of free markets disguises his practical conformity to the economic and political establishment. Moving from an attack on his professional prestige to a critique of his philosophical consistency, Rothbard treats the appointment as institutional continuity presented under misleading ideological credentials.

The opening mocks the nearly unanimous praise of Greenspan’s economic insight. Rothbard invokes his personal acquaintance with Greenspan thirty years earlier, but bases his immediate attack on reports about Greenspan’s consulting and investment businesses. He interprets the consulting firm’s dependence on its founder as evidence that clients bought Greenspan’s personality and opaque pronouncements rather than reliable forecasting. The failure of a pension-fund management venture supplies a further contrast between celebrated expertise and performance when money was at stake. These observations prepare the article’s governing judgment:

Greenspan’s real qualification is that he can be trusted never to rock the establishment’s boat.

For Rothbard, Greenspan’s acceptability follows from his position within a bipartisan Keynesian consensus. He classifies both Greenspan and his predecessor, Paul Volcker, as conservative Keynesians, whose policies differ little from those of liberal Keynesians. The anticipated combination is moderate deficits, tax increases, and monetary expansion accompanied by public expressions of concern about inflation. This is a prediction grounded in Rothbard’s interpretation of Greenspan’s record, not an assessment of his subsequent chairmanship.

The article’s conceptual center is the distinction between professing principles and allowing them to direct political action. Greenspan’s adherence to Ayn Rand and stated sympathy for laissez-faire and the gold standard might appear to distinguish him from other establishment economists. Rothbard argues that describing those convictions as philosophical, while calling practical compromises pragmatic, neutralizes their significance. A principle should provide direction even under imperfect circumstances; Greenspan instead makes its application conditional on circumstances already being ideal.

In short, never are one’s “high philosophical principles” applied to one’s actions.

Rothbard illustrates this objection through the conditions Greenspan supposedly requires before supporting a gold standard: a balanced budget, free trade, defeated inflation, and an appropriate philosophical climate. His hypothetical parallel concerning free trade exposes the circularity he sees in this reasoning. If each reform requires the others to have been achieved first, none becomes an actionable commitment. The criticism therefore concerns more than compromise: it charges Greenspan with separating his professed ends from any practical route toward them.

The final section supplies political and institutional examples. Rothbard cites Greenspan’s support for President Ford’s Whip Inflation Now campaign and, more consequentially, his leadership of the Social Security Commission. From Rothbard’s explicitly hostile view of Social Security, preserving the system through higher taxes meant rescuing an institution whose financial difficulties had created an opportunity to dismantle it. References to the Trilateral Commission and Greenspan’s Morgan directorships then locate him within the financial-political networks Rothbard considers decisive.

The conclusion makes Greenspan’s Randian reputation an additional advantage for that establishment: it could persuade free-market advocates that their cause had gained power while policy remained unchanged. The article’s enduring analytical interest lies in this account of ideological reputation as political cover. Its sharp personal judgments serve a broader libertarian test of officeholders: not whether they affirm market principles abstractly, but whether those principles constrain their concrete exercise of power.