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Whiteman Comments on Greenspan Legacy

On Jan. 31, Federal Reserve Chairman Alan Greenspan wrapped up 18 1/2 years as the nation's top monetary policy chief.

The Des Moines Register collected thoughts of Iowans on Greenspan's legacy. CHARLES H. WHITEMAN, professor of economics and director of the Institute for Economic Research at the University of Iowa, said: "To put Alan Greenspan's record in context for Iowans, one need only recall the difficult times of the mid-1980s. By some accounts, there was a Midwest recession," he said.

The farm crisis began when the Fed decided to get tough on inflation. The rate of inflation fell from a peak of 13 percent in 1980 to about 3 percent in 1983. That rapid decline helped pull down farmland prices, which plummeted.

"The tough monetary policy measures that were necessary at the time to bring inflation under control . . . were undertaken to correct earlier monetary policy mistakes," he said. "Poor monetary policy led to the high-inflation environment of the late 1970s, in which many farmers and businesses made decisions they subsequently regretted when inflation was wrung out of the economy in the 1980s.

"Nothing remotely like those circumstances has occurred during Greenspan's tenure. Good monetary policy under his direction has produced low, stable inflation that is beneficial for the economy generally, and particularly for Iowans."

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