Nixon was a crook and Arthur Burns was a failed central banker

Back from my trip to Riga and Stockholm and two books had arrived in the mail from Amazon.

The first one “Inside The Nixon Administration – the Secret Diary of Arthur Burns 1969-1974″ (Edited by Robert Ferrell, 2010). The second one is Larry White’s “Free Banking in Britain” (yes, dear readers believe it or not I did not read it before…).

Obviously I have not read the two books yet, but they are in some odd way complementary – the one is about how central banking can become hugely politicized and the second is about how to avoid that the monetary regime is politicized.

I did peak a little into the pages of the Burns diary. Burns who of course was Federal Reserve governor while Nixon was US president wrote a diary with notes from all its meetings with Nixon. I must admit that I am in total shock about how extreme the polarization of the US monetary policy was in the Nixon years. The man surely was a crook. One of the worst. However, from the little I have read Burns diary also clearly shows how misguided his views of monetary policy were. Again and again the diary mentions how he think price and wage controls are necessary to curb inflation, while Nixon at the same time is demanding money printing to be stepped up. Surely a bizarre duo – one a failed economist and one a crook. Very scary indeed.

So what is the lesson? Politics and money is a deadly cocktail and that is why you want to restrict both central bankers and a politicians when it comes to monetary policy.

If any of my readers have read these books I would be very happy to hear your opinion about them.

 

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3 Comments

  1. Thanks for mentioning my book, and of course I’d be interested in your response to it. Your readers might want to know that it is available online in pdf at a zero price on the iea.org.uk website. Just Google “Free Banking in Britain”.

    Reply
  2. Thanks Larry, I should of course also have mentioned that I just ordered your new book “The Clash of Economic Ideas: The Great Policy Debates and Experiments of the Last Hundred Years”.

    Reply
  1. Bernanke, Obama and the political business cycle – and some research ideas « The Market Monetarist

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