Greenspan's Fraud: How Two Decades of His Policies Have Undermined the Global Economy [Hardcover]

Ravi Batra (Author)

Book Description

Publication Date: April 14, 2005

For two decades Federal Reserve Chairman Alan Greenspan has held reign over economic policy, outlasting three presidents. His long tenure has had a profound effect on global economics and on individuals. In this hard-hitting exposé, international bestselling author Ravi Batra takes sharp aim at Greenspan's policies since he came into power. Greenomics, Batra argues, has extracted trillions of dollars from the American middle class and sharply benefited the rich, while protecting big business. Batra proves that Greenomics has also been responsible for periods of irrational exuberance, and exposes the wild inconsistencies in his social security plans. Greenspan's Fraud explores Greenspan's influences and motivations and the discrepancies between his words and actions, while revealing how his policies have national and global impact.

Editorial Reviews

From Publishers Weekly

In 1987, Alan Greenspan was appointed chairman of the Federal Reserve, and Batra had a bestseller predicting a depression deeper than the Great Depression, lasting from 1990 to 1996. Batra's second book, two years later, predicting the crash of 1990 did less well, and his books predicting disaster in 1996, 1997, 1998 and 1999 found fewer readers, lucid as they were. Batra did correctly predict a stock market downturn in 2000, but erred by blaming the Y2K computer bug and forecasting high inflation and deep, long lasting negative growth. Now Batra has switched from predicting the future to criticizing the past. Readers expecting sensational charges will be disappointed. "This is not fraud in the legal sense," the author reassures us. Instead, Greenspan has "seriously afflicted the finances of millions of families." Batra faults Greenspan's views on social security, minimum wage, taxes and the trade deficit. As always, his economic arguments are expressed elegantly. Missing is a direct link to Greenspan, who had only a peripheral advisory role in these issues (his job is setting interest rates, financial policy and bank regulation) and voices only highly modulated views when he does give opinions. The misplaced focus weakens the sound economic arguments, and the title is sensationalized at best. 100,000 first printing. $100,000 ad/promo. (May 9)
Copyright © Reed Business Information, a division of Reed Elsevier Inc. All rights reserved.

From Booklist

It is hard to decide who has the bigger ego, Federal Reserve Chairman Alan Greenspan or prolific author and professor Batra, who has written, among other books, The Great Depression of 1990 (1987). Batra takes great glee in demonstrating, step by step, how Greenspan has committed all kinds of fraud, starting with Social Security on through the trade deficit. When it comes to Social Security, the author claims, Greenspan has been operating a three-part ploy: raise an alarm about the deficit, ask workers for yet more sacrifices, then spend the extra monies on various government programs. Laissez-faire reigns supreme; the principle of an economy untouched by government holds sway. What's more, Batra includes charts detailing events pivotal to the chairman's fraud. His statistics are impressive, such as the fact that the bottom 20 percent of the country (or 56 million people) live on 3.6 percent of the national income. So are his visions of an economic democracy, including stability, fair and efficient treatment, and a far better standard of living for all; however, Batra's emotional presentation lessens his book's effectiveness. Barbara Jacobs
Copyright © American Library Association. All rights reserved

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Product Details

• Hardcover: 288 pages
• Publisher: Palgrave Macmillan; 1St Edition edition (April 14, 2005)
• Language: English
• ISBN-10: 1403968594
• ISBN-13: 978-1403968593
• Product Dimensions: 9.5 x 6.4 x 1 inches
• Shipping Weight: 1.1 pounds (View shipping rates and policies)
• Average Customer Review: 3.9 out of 5 stars  See all reviews (52 customer reviews)
• Amazon Best Sellers Rank: #183,477 in Books (See Top 100 in Books)

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42 of 49 people found the following review helpful:

4.0 out of 5 stars Looking for Mr. GREENSCAM!, May 20, 2005

By 

David N. Buckley (Danbury, CT USA) - See all my reviews
(REAL NAME)   

This review is from: Greenspan's Fraud: How Two Decades of His Policies Have Undermined the Global Economy (Hardcover)

     Despite its title, this is less a book about the "Maestro" Alan Greenspan (the current Chairman of the Federal Reserve System) than a review of the recent travails of the U.S. economy and the imbalances it has spawned at home and abroad by its plutocratic excesses. That Mr. G. is a privileged member of that plutocracy of wealth none would deny; he has after all been hailed as Chief Gnome of the Global Economy ever since the Stock Market Crash of 1987; but that he is also the chief architect of its manifold shenanigans and manifest frauds is a stretch, and a claim which Mr Batra can't make stick. Which is unfortunate because the U.S./global economy desperately needs a scapegoat right now!

Probably ALL of us know something about Mr Greenspan. He has been in the public eye as part of the politico-economic elite ever since President Ford appointed him Chairman of the Council of Economic Advisors in 1974. He became Chairman of the Fed in 1987, in the wake of the great Paul Volcker, and quickly established himself as Savior of Global Financial Markets after his prompt and brilliantly successful response to the Crash of `87. (How ironic that his Fed career should also ends with a crash: the Millennial Meltdown of 2000-2002). To the rest of us, Greenspan is probably best known for what is sometimes called "Fed-speak," a contorted, convoluted, pretzel-logic kind of economese that passes all understanding. (It might more reasonably be called "GreenSPAM"!) These tidbits aside, however, few of us know much about Mr. G. or the Federal Reserve. And because Batra does not provide us with a coherent chronological account of his quarry's background and career, we are at a loss to know whether the barrage of accusations that he fires off in his first chapter (a long and disorganised anti-Greenspan screed) has any merit. This is a failing which dogs Batra's footsteps throughout the book.

Although his case against Greenspan (in Chapters 1 and 4) is not as rigorous as we might like, Batra's larger argument about the causes of the U.S. economic malaise since the early Seventies is excellent. Specifically, what he provides is a much needed neo-Keynesian "demand-side" response to the manifest idiocies of "supply-side" conservatism. In the late Seventies and early Eighties, "Supply-siders" (so called) claimed that high taxes on the wealthy were bad for savings, and hence, investment, and hence growth. Batra shows (Ch 7) that the era of highest taxation on the wealthy, the Fifties and Sixties, was also the era of highest growth! Go figure! Supply-siders also claimed that raising the minimum wage would cause higher unemployment. "Not so," says Batra, who skewers that self-serving myth in Chapter 8. But, you may say, how could the Supply-Siders have been so WRONG if they had the RIGHT recipe for balancing the budget? The answer, as Batra shows, was that the budget was NEVER balanced; it was merely kept under control. How? By increasing payroll taxes on working Americans, under the sleazy guise of "fixing Social Security". Throughout the Eighties and Nineties, despite their alleged ideological differences, both Democrats AND Republicans lined up to vote for reduced taxes on wealth and increased taxes on work. By claiming to "save" Social Security they increased worker deductions, and then used the additional Social Security funds to "balance" the general budget! And, as Batra's incendiary second chapter on the "Social Securiity Fraud" convincingly demonstrates, they did so by lying through their teeth to the American public. Because Greenspan was at the center of that disgraceful stab in the back, Batra holds him accountable for the entire scam. GreenSCAM! But, if you read Chapter Two, which on its own will more than repay your invrstment in this book, you'll realize that while the "Maestro" was the ringmaster, there was no shortage of cheerleaders and helpmates. And Democrats were no less spineless than their GOP counterparts.

To conclude: this book is not a good guide to Greenspan, the man or the mythical figure who has dominated the economic landscape for the past twenty years. But it is an EXCELLENT guide to the manifest ways in which the "new economy" has benefitted the rich and shafted the rest of us.

67 of 81 people found the following review helpful:

5.0 out of 5 stars A Tutorial in Economic History, June 6, 2005

By 

Acute Observer (By the Shore NJ) - See all my reviews

This review is from: Greenspan's Fraud: How Two Decades of His Policies Have Undermined the Global Economy (Hardcover)

Ravi Batra is a Professor of Economics at SMU Dallas TX. This very readable book is partly about Greenspan's career in government, and politics, but mostly about the economic policies of the last three decades. Batra explains how the Federal Reserve has impoverished most Americans to enrich the wealthy, and attacked the middle class to benefit Big Business.

Chapter 1 tells the real impact of Alan Greenspan, how he unwittingly effected a global crash and spread economic misery (p.5). Greenspan's [...] swindled millions of families (p.6), while he benefited from his tax policies. Chapter 2, one of the most important, explains the [...] that was used to raise Social Security taxes in 1983 and then squander this money on tax cuts for the wealthy (p.12)! Greenspan's [...]was that he helped to raise payroll taxes, then sought to lower Social Security benefits (p.36). Chapter 3 discusses Greenspan's worship of "free profits" (p.48). Adam Smith was against mergers of competitors, and government regulation to restrict competition (p.50). The fallacy of Classical Economics is they could not account for depressions of falling output and rising unemployment (p.60). Batra explains the fallacy of "Supply Side Economics" (pp.68-70). Chapter 4 explains "Greenspan's Intellectual [...]" (p.74) as deceiving an audience by using fake or selective data for monetary gain. Greenspan saved the country from a Reagan Depression in 1987 by flooding the markets with liquidity (p.91). Afterwards he raised interest rates to regain this money and prevent inflation (p.92). Chapter 5 reports the global effects of Greenspan's policies. The 1981 tax cut led to soaring interest rates and a steep recession (p.123). Cutting the interest rate resulted in higher stock prices (p.136). The bubble of speculation inevitably burst (p.139).

Chapter 6 notes that economic theories can't explain the causes of a stock market bubble (p.141)! Batra says it is a mismatch between supply (productivity) and demand (wages and debt). When wages are high from productivity there is prosperity without a crash (p.143). Stagnant or falling wages create unemployment (p.146). Expansionary fiscal policies create a debt that comes due (pp.147-148). Regressive taxation and low wages create a global crisis. Chapter 7 explains how the income tax rate affects our standard of living. Reagan's tax cuts created a giant budget deficit and high interest rates (p.169). Clinton's raised income tax rates was followed by relative prosperity. Bush lowered the top income tax rate, which always hurts the economy and stunts economic growth (p.173). Chapter 8 documents another of Greenspan's [...], the claim that minimum wages create unemployment. This lie has been proven wrong since 1935. Greenspan wants increased immigration to keep wages down (p.191)! High money growth causes inflation (p.192).

Chapter 9 discusses the trade deficit, which could cause the budget deficit (p.199). A country that exports goods has a trade surplus, one that exports services or farm products has deficits (p.204). Prosperity comes from manufacturing (p.205). Regressive taxation has forced a gap between wages and productivity (p.214). A regressive value-added tax makes it worse. The merger mania results from a lack of competition and the desire for monopoly control of output. Chapter 10 tells how Greenspan's policies changed but still aimed at the economic destruction of the middle class (p.217). Most Americans have seen a drop in their living standards since 1973 (p.219). Regressive taxes, higher health insurance, and lowered pensions make it worse (p.220). The effect is rising bankruptcies, mushrooming debt, and a drastic decline in the household savings rate (p.221). Countries with ultra-regressive taxes like VAT (value-added taxes) experience the same slow growth and higher unemployment (p.229).

Chapter 11 lists the needed economic reforms. Batra lists the top-ten problems that need fixing (p.236). Returning Social Security to a pay-as-you-go system will benefit the economy (p.240). An ethical economic policy benefits all of us, an unethical economic policy creates massive debt and increasing poverty (pp.244-245). Batra lists 6 reforms for wages and taxes to bring back prosperity (p.247). A separate export exchange rate will benefit manufacturing (p.251). Reducing the wage gap will reduce recessions, inflation, and poverty (p.253). The long-run cure for economic imbalance is economic democracy (p.255). [But his proposals seem to idealistic, and lack the checks and balances needed in the real world. Batra does not mention that these regressive policies came about after Nixon's devaluation of the US dollar in 1971.]

34 of 43 people found the following review helpful:

5.0 out of 5 stars Just because you don't agree with Batra doesn't make it bad, July 6, 2005

By 

Tom Mueller (Tyler, TX) - See all my reviews

This review is from: Greenspan's Fraud: How Two Decades of His Policies Have Undermined the Global Economy (Hardcover)

I don't see what all the fuss is from these negative reviewers who badly want to defend Greenspan's corporatization policies and support thereof which have resulted in more corporate dictatorships and poverty both here at home in the U.S. and around the world. Batra has coherently presented a book which links our current fascist anti-working class government to Greenspan and the corporate crony robber barrons on Wall Street. If you are sick and tired of the corporate fascism which has pervaded the U.S. like cancer for the past 25 years thanks to Greenspan, Reagan, Clinton, Bush I and II, and most Republicans and Democrats, this book is for you.