">>Nevermind that he [Reagan}--or rather his friends, since he mostly just smiled and waved and told folksy stories--spent a lot of time badmouthing Volker for keeping rates high in the early 80s"<<
From Volker's book Changing Fortunes, pg 173ff:
"President Reagan must have received lots of advice to take on the Fed himself, but he never really did despite plenty of invitations at press conferences or otherwise. I never saw him often, as I had Mr Carter, nor did I feel able to develop much personal rapport or indeed much influence with him. He was unfailingly courteous, but he plainly had no inclination either to get into really substantive discussions of monetary policy or, conversely, to seek my advice in other areas. But I had the sense that, unlike some of his predecessors, he had a strong visceral aversion to inflation and an instinct that, whatever some of his advisors might have thought, it wasn't a good idea to tamper with the independence of the Federal Reserve, which, after all was said and done, was trying to restore stability.
Certainly, the administration generally supported our efforts to restrain money growth in 1981, even at the expense of ferociously high interest rates. I recall particularly the delight with which Secretary Donald Regan received the news that we were about to raise the discount rate in May to help deal with a bulge in the money supply even though, as it turned out, that was very close to the peak of business activity."
I just love catching you old Reagan-haters in the act of Clintonizing. |
