Even Alan Greenspan is a Keynesian now

In an interview with the Financial Times, former Federal Reserve Chairman Alan Greenspan officially came out in favor of temporary bank nationalization as a possible solution to the current economic crisis: It may be necessary to temporarily nationalise some banks in order to facilitate a swift and orderly restructuring. I understand that once in a ...

588423_090218_greenspan5.jpg
588423_090218_greenspan5.jpg

In an interview with the Financial Times, former Federal Reserve Chairman Alan Greenspan officially came out in favor of temporary bank nationalization as a possible solution to the current economic crisis:

It may be necessary to temporarily nationalise some banks in order to facilitate a swift and orderly restructuring. I understand that once in a hundred years this is what you do.”

This is a big admission for Greenspan. But it seems as if the erstwhile devotee of Ayn Rand has been reassessing his ideas as of late. This past October, during testimony for the House Committee on Oversight and Government Reform, Greenspan said,

This modern risk-management paradigm held sway for decades. The whole intellectual edifice, however, collapsed in the summer of last year.”

Well, as Martin Wolf recently wrote in FT, “We are all Keynesians now” — even the high priest of neoliberal economics himself. It’s a new day.

TIM SLOAN/AFP/Getty Images

Elizabeth Palchik Allen is a freelance writer based in Kampala, Uganda. 

More from Foreign Policy

Former Secretary of State Henry Kissinger prepares to testify before the U.S. Senate Foreign Relations Committee.
Former Secretary of State Henry Kissinger prepares to testify before the U.S. Senate Foreign Relations Committee.

Was Henry Kissinger Really a Realist?

America’s most famous 20th century statesman wasn’t exactly what he claimed to be.

The leader of the Palestinian Hamas movement, Ismail Haniyeh, shakes hands with Iranian Chief of Staff for the Armed Forces Mohammad Bagheri and the commander of Iran's Revolutionary Guard force, General Hossein Salami, during the swearing in ceremony for Iran's new president at the parliament in the Islamic republic's capital Tehran on August 5, 2021.
The leader of the Palestinian Hamas movement, Ismail Haniyeh, shakes hands with Iranian Chief of Staff for the Armed Forces Mohammad Bagheri and the commander of Iran's Revolutionary Guard force, General Hossein Salami, during the swearing in ceremony for Iran's new president at the parliament in the Islamic republic's capital Tehran on August 5, 2021.

The 7 Reasons Iran Won’t Fight for Hamas

A close look at Tehran’s thinking about escalating the war in Gaza.

A globe with blocks and chunks missing from it sits atop the shoulders of a person looking into a dystopian horizon.
A globe with blocks and chunks missing from it sits atop the shoulders of a person looking into a dystopian horizon.

The Global Credibility Gap

No one power or group can uphold the international order anymore—and that means much more geopolitical uncertainty ahead.

Joaquin Phoenix (center) stars in the film "Napoleon."
Joaquin Phoenix (center) stars in the film "Napoleon."

What Ridley Scott’s ‘Napoleon’ Gets Wrong About War

The film’s ideas have poisoned military thinking for centuries.