After the Maestro

April 24, 2003

PRESIDENT BUSH'S early endorsement of a fifth term for Alan Greenspan - just as the 77-year-old Federal Reserve Board chairman was undergoing successful surgery Tuesday for an enlarged prostrate - was an encouraging tonic for Wall Street. And it could not have been intended otherwise.

Just two months ago, there was inside-the-Beltway buzz about tensions between the president and Mr. Greenspan, perhaps even a repeat of the clash between the president's father and the Fed chief a decade ago. After all, Mr. Greenspan had the honesty to challenge Mr. Bush's reckless drive for more tax cuts, which already are bringing the return of massive federal budget deficits.

But publicly sparring with Mr. Greenspan is just another of the 41st president's mistakes that the 43rd president is determined not to repeat. The Fed chairman's longevity in his job (15-plus years, through four presidents) and his deftness (he's not dubbed "the Maestro" for nothing) have given him a vastly larger-than-life role in instilling confidence in the American economy.

Suffering through a faltering national recovery from several very bad years - and facing re-election next year - Mr. Bush is wise to indicate Mr. Greenspan is free to keep running the Fed, at least until 2006, when his current term on the board expires.

But despite the Maestro's energy and love of his job, he can't forever serve as the economy's wizard behind the curtain. If his near-cult status inspires confidence, what happens when it's time for his successor? Even though the bursting of the national economic bubble the last few years has shown Mr. Greenspan as less than super-human, these are big shoes to fill - even more so because his many successes are attributed to his political agility and idiosyncratic skill at deciphering economic trends.

Analysts of such matters bandy about an evolving list of potential successors. And there's been talk of trying to codify Mr. Greenspan's at times opaque policies - by having the Fed adopt a set inflation target and holding it accountable for hitting it. This would amount to an effort to continue the Greenspan era on autopilot after he's gone.

But if America's economy - not to mention its presidency - is so dependent on Mr. Greenspan, perhaps what's ultimately needed here is some transparent succession planning. The Maestro ought to be up to that.

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