-->GREENSPAN’S FRAUD
How Two Decades of His Policies Have Undermined the Global Economy

by New York Times bestselling author
Ravi Batra

“Here, finally, is the dark truth about Alan Greenspan. In this chilling exposé of one of the most powerful men of our time, Ravi Batra reveals Greenspan for who he secretly is: An ideologue who has waged war on the American Dream and imperiled the world economy. GREENSPAN’S FRAUD is a terrifying book.”

—David Callahan, author of The Cheating Culture: Why More Americans Are Doing Wrong to Get Ahead


For twenty years Federal Reserve Chairman Alan Greenspan has held reign over economic policy, outlasting three presidents and becoming a veritable celebrity. When he steps down in 2006, a rosy memory of his legacy is poised to go down in history.
Few have dared to criticize Greenspan's record, but in GREENSPAN'S FRAUD: How Two Decades of His Policies Have Undermined the Global Economy (Palgrave Macmillan), New York Times bestselling author Ravi Batra tells a startling story of inconsistency and misused power with perilous consequences that are only beginning to unfold.

At a time when the future of social security is being debated more fiercely than ever, Batra makes an explosive claim that Greenspan committed social security fraud in 1983 by helping to raise payroll taxes so the government could meet its operating expenses but selling his plan to the public as Social Security reform. This way he falsely offered slash-proof retirement benefits to Americans in exchange for tax increases. Batra reminds readers of “the maestro’s” forgotten assurances to the public that the Social Security Trust Fund surplus would meet the pension needs of baby boomers and would never be used to balance the budget. But Batra exposes persuasive evidence that “from the moment the new Social Security tax went into effect, its surplus revenue was used primarily, if not completely, to pay for the shortfall in the general federal budget. Indeed this was done as a matter of routine.” After collecting $1.5 trillion of extra taxes from working families over two decades, the Social Security Trust Fund still has no surplus cash to meet their pension needs, while the general budget is saddled with more than $400 billion of deficit per year.

Batra not only criticizes Greenspan’s role in America’s ballooning deficit crisis, but he also points to evidence that holds him responsible for “the worst income and wealth disparity at least since 1929,” today’s mounting consumer debt crisis, and escalating economic stagnation.

Batra also accuses Greenspan of:
Rising to power from out of nowhere with “no banking experience,” few credentials, and “had not done any path-breaking work in economics”
Changing his theories repeatedly with the changing of the guard at the White House presumably to remain as the Fed chairman. Greenspan opposed a cut in the income tax under President Carter, supported it under Reagan, opposed it under Clinton, and then supported it under Bush
Falsely claiming that the standard of living rose under his stewardship of the economy even though “the real wage of 80 percent of Americans fell in the 1980s and stagnated in the 1990s”
Contributing to the share market euphoria of the 1990s, which “resulted mostly from his policies that caused people's wages to lag behind productivity gains”
Denouncing antitrust laws as “utter nonsense”
Regarding big business as “America’s persecuted minority”
Agreeing to abolish the minimum wage, claiming that it creates job losses, even though history has proven the opposite
And causing, more than anybody else, “the prolonged stagnation in which the United States has been mired since the start of the new millennium”

Batra, who has built his reputation on forecasting, predicts that without the reform of “Greenomics,” America will encounter an “employment recession” for the rest of this decade. In an urgent wake-up call, GREENSPAN’S FRAUD will open readers’ eyes to the unraveling of the global economy by one of the world’s most powerful men. Batra goes on to offer a simple plan that will sharply cut the U.S. trade deficit within the confines of free trade.



Greenspan’s Social Security Fraud Dateline: 1981-2004
1981: Greenspan advises the president to cut income and corporate taxes, and later agrees to chair the Social Security commission, ostensibly to save the Social Security system.
1982: The Greenspan commission diverts the public attention from the real crisis, which is the mushrooming budget deficit, by insisting that Social Security faces a massive long-term deficit.
1983: In January the Greenspan commission advises Americans to accept sharply higher payroll taxes in exchange for guaranteed benefits in future, suggesting that the projected Social Security surplus should not be used to balance the general federal budget.
In April, the Social Security act is signed into law, but Greenspan remains silent even though the Social Security Trust Fund could be used to meet the government’s operating expenses until 1992, thus contradicting Greenspan’s recommendation made in the commission’s report.
In October, just six months after the tax rise had been passed, Greenspan suggests that Social Security benefits be trimmed to reduce the budget deficit, thus contradicting recent legislation and his commission’s plea to guarantee benefits from 1985 on.
1990: Greenspan denounces the Moynihan plan to trim the payroll tax, even though the Social Security surplus is being used in non-Social Security spending by the government.
1999: Greenspan warns Congress against relying solely on the projected surplus in the unified budget to ensure the solvency of the Trust Fund, because projections could be wrong. He reaffirms his plea to trim the benefits.
2001: Greenspan supports the Bush tax cut to reduce the projected budget surplus. This time, he is not worried that projections could be wrong.
2004: Greenspan suggests that benefits should be cut for future retirees, because the Bush tax cuts that he had supported have created a large budget deficit, even though the Social Security Trust Fund itself is running an annual surplus of nearly $170 billion.
Greenspan’s Fraud: 1. Helping to raise the payroll tax to meet the government’s operating expenses, but selling the plan as Social Security reform.
2. Supporting tax cuts for the wealthy and asking workers to make sacrifices, using projections not facts. Mark Twain once said: “There are lies, damned lies, and statistics.” Greenspan made full use of such damned lies to benefit the wealthy.
Greenspan’s Intellectual Fraud Over Three Decades: 1977-2004
1977-1979: Greenspan advises against an income tax cut for its inflationary potential.
1980-1981: As Reagan’s economic adviser, Greenspan backs income tax cuts to fight inflation, and lower interest rates.
1982-1983: With the deficit breaking records, Greenspan backs a gasoline tax rise in 1982, and a Social Security tax rise in 1983 to lower the deficit and the interest rate. So now the tax rise is needed to lower the interest rate.
1990: Greenspan opposes the Moynihan plan to cut the payroll tax, because it will erode the public confidence in the Social Security system, even though the system’s surplus is zero, because its extra cash is being used completely for government’s operating expenses.
1991-1999: Greenspan argues that budget deficits are inflationary and generate high interest rates, so spending should be cut substantially. He opposes an income tax cut under Clinton, thus contradicting his earlier support for Reagan’s program.
2000-2004: Greenspan backs Bush’s income-tax cut in 2001 to lower the projected budget surplus. In 2004, he backs all of Bush’s tax cuts to lower the projected budget deficit.

Intellectual fraud occurs when someone uses his/her superior intellect to contradict his/her ideas, theories and opinions to further his/her self-interest. As the table indicates, Greenspan contradicts himself repeatedly in his political career over three decades. Thus Greenspan has committed intellectual fraud on a grand scale.
Oscar Wilde, the celebrated playwright, once said, “The well-bred contradict other people. The wise contradict themselves.” Greenspan has been extremely wise over roughly three decades of his government service.

What Others Say about Greenspan’s Fraud

"In the short term, he [Greenspan] did wonders for the U.S. economy, but now we are saddled with the bill," says Ravi Batra, an economist at Southern Methodist University and author of a new polemic, Greenspan's Fraud.
Time

As always, his [Batra’s] economic arguments are expressed elegantly.
Publishers Weekly


Greenspan's Fraud by Ravi Batra finally takes on St. Alan and finds that the emperor not only has no clothes but has succeeded in fooling everyone into believing that he is serving the interests of the global economy. He's in bed with big business and this is the first time it's all laid out to be seen.


rickymonet.dailykos.com/story/2005/3/4/213949/8627 - 80k -


Southern Methodist University economist Ravi Batra, author of"Greenspan's Fraud," argues that throughout his tenure, the Fed chief has consistently sided with capital over labor and rich over poor."He is not a friend of working families," Batra said.
San Francisco Chronicle

The best-selling author of The Great Depression of 1990 takes on Greenspan, arguing that his policies have damaged the middle class.
Library Journal

An explosive critique of Alan Greenspan's economic policies by New York Times bestselling author Ravi Batra.
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About Dr. Ravi Batra and His Forecasts

Dr. Ravi Batra is the author of six international bestsellers, two of which were New York Times bestsellers, including The Great Depression of 1990. He has appeared on CBS, NBC, ABC, CNN, and CNBC, and in The New York Times, Time, Newsweek, and many other publications. He is a professor of economics at Southern Methodist University, Dallas.

Batra is best known for his forecasts based on examining historical cycles. Only two of his many predictions have proven incorrect. Otherwise, his track record for forecasting has “proved close to the mark” (The New York Times), and “has won glowing praise from many pragmatic investment masters” (Chicago Tribune).

In a book titled The Downfall of Capitalism and Communism published in 1978, Batra predicted that both systems would collapse around the year 2000, give or take a decade, or starting about 1990. Since the Berlin wall fall in November 1989, this prophecy was right on dot. In fact, for this prediction, Batra was awarded a Medal of the Italian Senate by the Italian prime minister in October 1990.
Batra also predicted in 1978 that a revolution would occur in Iran in 1979 and that the priesthood would take over. He went on to explain his analysis in his 1980 book, The Muslim Civilization and the Crisis in Iran, in which he made a startling forecast that Islam would convulse the Western World around 2000, something that came to pass in the 9/11 massacre in 2001.

In his book The Great Depression of 1990, parts of which were published in 1983, Batra correctly predicted that the recession of the 1980s would be followed by boom times until 1989 while inflation, interest rates, and oil and farm prices would tumble. Indeed, share prices broke records every year between 1983 and 1987, but then plunged in a stunning crash, which was anticipated in the second edition of the book published in May 1987, six months prior to the October 19 crash.

However, his forecast of the depression of 1990 is one that has not materialized so far. Batra attributes this failure to the unprecedented amounts of money that countries like China and Japan have invested in U.S. government bonds. Such an economic behavior, in which nations accept paper assets in exchange for tangible goods, has no parallel in world history.

In 1988 Batra correctly predicted that the US dollar would collapse by the end of 1994, that inflation and interest rates would tumble again in the 1990s, and that real estate values would plummet in many areas of the United States.

In 1991 Batra predicted the emergence of a third political party in the United States and that President Bush would be defeated by a Democrat. Soon after this prediction, Ross Perot launched a new party in 1992 and won an unprecedented 19 percent of the vote in the presidential election. His success contributed to Bill Clinton’s unexpected victory at the expense of the once invincible George Bush.

In 1992 Batra correctly predicted that NAFTA would depress the Mexican economy and U.S. real incomes. The devaluation of the peso in December 1994 catapulted Mexico into a deep depression.

In forecasts made between 1996 and 1997, Batra correctly predicted that the global speculative bubble would burst by August 1998. He also predicted that Alan Greenspan would lower interest rates when share markets would begin their fall in the United States. Once that happened, another of Batra’s prediction came to pass: that the American economy would be an oasis of prosperity in the midst of an increasingly depressed world.


Praise for Ravi Batra’s previous books:

“Ravi Batra has made an outstanding reputation in the United States.”
—Leonard Silk, New York Times
“Dr. Batra writes about his subject as clearly as if he were telling bedtime stories.”
—Christopher Lehmann Haupt, New York Times
“The forecasting record of this widely respected Southern Methodist University economist has won glowing praise from many pragmatic investment masters.”
—Tom Peters, Chicago Tribune
“Scary, provocative. The good professor has a formidable academic reputation and, from what I know, his forecasting record is impressive.”
—Barton Biggs, Morgan Stanley & Company
“Batra [is] a scholar who has earned a considerable reputation as an expert on trade.”
—Albert Crenshaw, Washington Post
“When it comes to the bottom line so beloved of economists, one can learn a lot about events by thinking about them in cyclical regularities, of which Batra gives a novel and brilliant exposition.”
—Lester C. Thurow, Professor, MIT
“His predictions in the early 1980s of low inflation, falling oil prices and a wave of mergers--mocked for years--have proved close to the mark.”
—Thomas C. Hayes, New York Times
“Ravi Batra was used to making tumultuous global forecasts and having nobody listen--then predictions started to come true.”
—Chip Brown, The Associated Press
“So far Dr. Batra is close to five for five. Pray he doesn't go six for six.”
—Eric Leven, People