Mr. Greenspan conceded: "Yes, I’ve found a flaw. I don’t know how significant or permanent it is. But I’ve been very distressed by that fact."
Allow me to 'splain, Dr. Bubble. It's significant and permanent. The "flaw" that seems to perplex and distress you are people. The human beings that are integral and essential to the existence of an economy. And once people are interjected into your sterile, number crunching view of economics, all sorts of strange things happen. For example, who knew that your banker and stockbroker buddies were people? People who lie, cheat and steal – and given the opportunity to lie cheat and steal on a grand scale with limited risk of being caught and practically zero risk of paying any price for it -- how could such American business movers and shakers resist the temptation?
It would be easy to assume that Greenspan along with anyone over the age of ten already knows about human nature. But it takes a human to know a human, and he doesn't speak like a human.
"This modern risk-management paradigm held sway for decades," he said. "The whole intellectual edifice, however, collapsed in the summer of last year."
It's been over a decade since the rest of us quit using the overworked (and misused) word, paradigm. Applying it to a mantra, "the free market knows best," doesn't make it a paradigm or true. Markets are never free – they are human inventions. Sort of like the FED. Strange that he never noticed that.
For all his experience and education, guess Dr. Bubble seems not to have grasped the fact that economics is a SOCIAL science. Not neat and clean like mathematics. Messier than the hard sciences. Not even as neat as accounting (and that's without reference to the filthy financial house kept by Arthur Anderson and Enron). And that Ayn Rand's writing, storytelling and philosophy ranks below the creativity and skill of Enron's accounting, but they share an anti-social orientation. --sigh-- Perhaps Dr. Bubble confused anti-social (narcissism) with anti-socialism. A psychological disorder with an economic system.
Chis Hedges in The Idiots Who Rule America perfectly describes Greenspan and his ilk:
Our oligarchic class is incompetent at governing, managing the economy, coping with natural disasters, educating our young, handling foreign affairs, providing basic services like health care and safeguarding individual rights. That it is still in power, and will remain in power after this election, is a testament to our inability to separate illusion from reality. We still believe in "the experts." They still believe in themselves.
Greeenspan is a real economic hit man and it's time we began treating him as such.