Greenspan Aided and Abetted Washington Financial Scandal

The White House had just released its forecast of the highest U.S. budget deficit ever, but Federal Reserve Chairman Alan Greenspan was not about to be pulled into a blame game. Yes, Greenspan told a House panel on Wednesday, deficits are bad, but then again so is some government spending, and tax cuts can be quite good but only if made judiciously.

"I would prefer to find the situation in which spending was constrained, the economy was growing, and that tax cuts were capable of being initiated without creating fiscal problems," Greenspan said.

"I would prefer a world in which Julia Roberts was calling me," replied an exasperated Rep. Bradley J. Sherman (D-Calif.), "but that is not likely to occur."

As the government's red ink rises to historic levels, Democrats -- and a few quiet Republicans -- have become impatient with the man they say bears some responsibility for the burgeoning budget morass. In January 2001, as President Bush began his term after the disputed election and even allies were saying his proposed $1.6 trillion tax cut was too large, Greenspan unambiguously flashed a green light to Congress to push it through.