The age-old ethical question of whether dubious means justify noble ends was settled long ago in our
nation's capital, judging from the statements and actions of our political leaders. The idea that a
politician would be less than candid when describing why he or she supports a policy hardly comes as a
shock to anyone. Appeals to emotion and raw political clout trump logic and reason almost every time.
But some in Washington have more credibility than others, and in the wake of the longest economic
expansion on record, the words of the Federal Reserve Chairman Alan Greenspan perhaps carry the
most weight of all. That's why it was particularly disappointing to see the sands shift under Mr.
Greenspan's feet as he groped for a way to reverse his previous pronouncements and join the tax cut
bandwagon.
The disappointment is not in the end result, but in the tortured, convoluted road the Fed Chairman used
to get there. For even if his support helps boost a policy that many of us feel is a good one for the U.S.
economy, it is troubling nonetheless to see our nation's chief economic policymaker join the ranks of
others who are less than genuine in describing their motives.
If that sounds a bit harsh, consider the essence of Mr. Greenspan's argument for cutting taxes. With
upwardly revised Congressional Budget Office estimates of future surpluses, the Fed chairman says, we
now run the risk of paying down the national debt too quickly, giving future policymakers fewer options
to control the economy.
That's the kind of logic we might expect of a second year graduate student, not the leader of the
world's largest economy. CBO projections, which extend ten years into the future, are not only
unreliable, they are logically flawed, as they assume Congress will stick to budget agreements that have
been broken every year. Moreover, the free-wheeling spending of Congress in the last two years has
demonstrated convincingly that commitments to retire debt are worth very little.
It is increasingly clear that the debate over tax cuts is really a fight over the size of the Federal
Government. There is a hollow ring to the new administration's claims that a tax cut is needed to boost
the slumping economy, to be sure. But its logic is no more flimsy than the new-found fiscal austerity of
some Democratic leaders, or the appeals to save Social Security or other popular programs. Neither
view openly acknowledges the simple truth that the only way to get Congress to spend less money is to
take it away.
To be fair to Mr. Greenspan, his statements make it clear that he is fully aware of these points, and thus
his vapid arguments were nothing more than a face-saving way of changing his policy position to reflect
that reality. But the risk to his personal credibility in advancing such views is certain to rise.