The Man Who Knew: The Life and Times of Alan Greenspan — Seven: DO‑NOTHINGISM

1. 1. By the time Nixon took office, total private debt had doubled from 52% of GDP in 1945 to 107%, making the economy vulnerable to rising interest rates.
2. 2. Savings and loan associations faced a crisis because Regulation Q caps prevented them from raising deposit rates to compete with higher-yielding bonds, causing deposits to flee.
3. 3. Greenspan and Milton Friedman argued on the commission to end the draft that conscription was a 'hidden tax' on low-income men, equivalent to a regressive income transfer.
4. 4. Friedman famously retorted to General Westmoreland's objection to an all-volunteer force by calling conscription slavery and rejecting the term 'mercenaries' for volunteers.
5. 5. Nixon pressured Fed Chairman Arthur Burns to keep monetary policy loose ahead of the 1972 election, using a smear campaign and recruiting Greenspan as a messenger.
6. 6. At the Camp David meeting in August 1971, Nixon decided to abandon the gold standard and impose wage and price controls, rejecting austerity and deregulation.
7. 7. Greenspan was physically injured by the shock of Nixon's announcement, throwing out his back while watching the speech, and was bedridden for weeks.
8. 8. Greenspan predicted that Nixon's price controls would only temporarily suppress inflation and would lead to shortages and higher prices later, which proved correct.
9. 9. The financial reform commission's recommendations to phase out Regulation Q and break down silos between lenders were shelved by Nixon until after the 1972 election.
10. 10. Greenspan wrote a New York Times column titled 'Do-Nothingism' in July 1973, arguing that inflation stemmed from politicians' compulsive meddling, tracing back to Kennedy's stimulus.