Fed Chairman Greenspan’s Quirky Past

W A S H I N G T O N, Sept. 25, 2000 -- As a young man, decked out in a canary yellowjacket, he blew a mean saxophone in jazz clubs around the country.

Now the world knows Alan Greenspan as the ever-serious FederalReserve chairman who has attained near cult status for shepherdingthe U.S. economy through its longest expansion in history. He isoften called the second most powerful man in the government.

The first biography of the 74-year-old chairman traces howGreenspan, raised in poverty by a single mother, transformedhimself from nerdy economic thinker to indispensable adviser tofive presidents.

This Is Greenspan’s LifeNew York writer Justin Martin said he was driven to write Greenspan: The Man Behind Money by the sense that Greenspan hasled a fascinating private life. The book, published by PerseusPublishing, will be out in November.

“I just knew there had to be a story there,” Martin said.

Martin interviewed 250 of Greenspan’s friends, from elementaryschool classmates to Greenspan’s ex-wife and his current wife, NBCnewswoman Andrea Mitchell. The book is not an authorized biography,but the Federal Reserve said Greenspan and Fed staffers helpedMartin check his facts.

Humble BeginningsGreenspan grew up in his grandparent’s cramped one-bedroomapartment in New York, where his mother Rose had moved afterdivorcing Greenspan’s father, Herbert, when Greenspan was 5.

The precocious Greenspan would sing the Depression-era anthem“Brother, Can You Spare a Dime?” to get spare change from hisuncle and would add up three-digit numbers in his head to impressguests.

At 9, Greenspan read Recovery Ahead, a book his absentfather, a sometime economic consultant, had written in praise ofPresident Franklin Delano Roosevelt’s economic programs.

In an inscription, the father expressed the hope that his son“may look back and endeavor to interpret the reasoning behindthese logical forecasts and begin a like work of your own.”

In school, Greenspan’s real love was music. He enrolled atJulliard School of Music, aiming for a career as a professionalmusician. But he grew restless and left school to tour in HenryJerome’s dance band, pulling down $62 a week by playing tenorsaxophone, clarinet and occasionally the flute.

“Alan was good, although he wasn’t primarily a jazz player,”Jerome told Martin. “I hired him because he was an excellentmusician, but I didn’t use him as an improviser.”

Playing With NumbersGreenspan did the band’s books and helped band members withtheir taxes. He came to recognize that he had too little musicaltalent and left the band after a year to pursue his other passion,numbers. He earned an undergraduate degree in economics in 1948.

It took another 29 years for him to earn a doctorate. New YorkUniversity awarded it in 1977 based on Greenspan’s off-and-onpursuit of the degree and a collection of his writings, includingthe annual economic report of the president prepared when Greenspanwas chairman of the Council of Economic Advisers under PresidentFord. Greenspan never finished his dissertation.

While Greenspan’s first marriage, to Joan Mitchell, an arthistory student from Canada, ended after just 10 months, the tworemained close.

It was through his ex-wife that Greenspan was drawn into thecircle of Ayn Rand, controversial author of The Fountainheadand Atlas Shrugged. Rand’s followers, known as Objectivists, were intense believers in Rand’s celebration of ruggedindividualism and the triumph of capitalism over socialism.

Rand at first derided Greenspan as “the undertaker” for hispreference for somber suits, but in time he was admitted to herinner circle.

While many liberals viewed Objectivists as an odd cult,Greenspan never disavowed his friendship with Rand, explaining thathe was grateful to her for opening his eyes to the moral dimensionof capitalism.

The Road to the White HouseA chance encounter in the 1960s with an old jazz band buddy,Leonard Garment, launched Greenspan, by now a successful economicconsultant, onto a career as an adviser to presidents.

Garment recruited Greenspan for the 1968 presidential campaignof Garment’s law partner, Richard Nixon. Greenspan turned down thechance to join the Nixon administration as budget director,explaining later that he and Nixon “never really got along verywell together.”

After Nixon’s resignation, Greenspan became Ford’s economicchief. They developed a close relationship, although his governmentdebut resulted in his biggest public gaffe.

During a summit on inflation, Greenspan, seeking to defendFord’s policies, said, “If you really wanted to examine whopercentage-wise is hurt the most in their incomes, it is the WallStreet brokers.”

Greenspan was quick to recover from the uproar, which includedmock “Save Our Brokers” groups being formed around the country.“Obviously, the poor are suffering more,” he contritely toldCongress.

As chairman of the Federal Reserve, Greenspan has never repeatedsuch a blunder. Instead, during 13 years at the helm, Greenspan isnow known as a master of obfuscation.

Top Stories

Top Stories

Top Stories

Top Stories

ABC News Live

ABC News Live

24/7 coverage of breaking news and live events