The LA Times profiles Paul Volcker, Obama's new chair of the freshly created "Economic Recovery Advisory Board" under the front-page link headline, "If Volcker Has His Way, There Will Be Pain." (The actual story has a far duller hed.)
Volcker's old tough-love success at curbing inflation when he ran the Fed in the early '80s is profiled diligently and entertainingly in a feature in the January issue of reason(not yet online, but already in the hands of subscribers). The feature is by Robert J. Samuelson, excerpted from his book The Great Inflation and Its Aftermath.
But that's not the kind of toughness this article talks about, instead linking Volcker's bloodless cruelty to his desire to more heavily regulate exotic new financial instruments–and, better, to his recognition that we-as-a-nation need to stop spending so wildly beyond our means. This is a lesson that his boss Obama will have a politically tough time heeding. It's not clear from this piece whether Volcker thinks that monetary policy, his special area of expertise, bears any responsibility for the bursting bubbles of the past decade, given that the overall price inflation rate hasn't been scarily huge.
The most depressing insight in the LA Times piece into the way our national economic policy is thought about by our elites comes from Princeton's Alan Blinder: "It is less about [Volcker's] ideas but more about his stature, wisdom and integrity…There is not another person on the planet who can match that combination."
Now, we know that Washington highly values its own sense of stature and perceived integrity. But people on all sides, whether a strict "if the CPI ain't flying high, inflation isn't an issue" type or the shiniest of goldbugs, should be able to admit that it does matter what ideas are brought to bear in government attempts to manipulate and manage the economy–that some ideas when implemented are more apt to achieve our goals than others, no matter the stature and integrity of those who suggest the ideas.