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Greenspan's Model
The financial crisis reveals Alan Greenspan's deep philosophy to be nothing more than speculation.

November 3, 2008
Also published on The Huffington Post

On October 23rd, the world was presented with a single admission. It was remarkable both for the magnitude of the error to which it corresponded, and for the fact that it was being uttered at all during a time when political and business leaders know "fault" as "a word that is often shouted at tennis matches." Before television cameras and Congressmen, Alan Greenspan plainly admitted that he had made a mistake, and one that had cost the global economy years of progress and trillions of dollars.

Though I used to joke about it, I have no familial relation to the former Fed Chairman. (A "fair-weather relative," one of my friends has called me, and though I never actually claimed to be related, I am now adamant about the fact that I am not.) Yet these past few days, as the headlines have increasingly honed in on the Fourth of November, I've begun to feel closer to my namesake than ever. While his optimistic, free market model of the world broke a long time ago—sometime between the peak of the NASDAQ and the domino-effect collapse of the nation's most prominent financial institutions—I now understand how it is possible to go through life for forty years with such a flawed view, thinking that it's working all along, as Alan Greenspan said he did. This is because with this new Day of Independence from corruption, fear, and naivete (of the worst sort) on the immediate horizon, I have the distinct feeling that my model of the world is about to break, too.

As long as I have been an adult, the President of the United States has been George W. Bush, and life has not been easy. I graduated early from college and decided to run my own business, not realizing that with my pre-existing conditions, doing so was equivalent to signing a full health insurance waiver that would take effect one year earlier than it really had to. Either the fact that I drank one too many glasses of root beer in college dining halls or a dose of incredibly bad luck saddled me with an entirely new set of health problems after that. My medical bills went through the roof.

At home, whose gravitational pull I was trying desperately to escape, my brother, who suffers from autism, was making life unbelievably hard on my parents. So was the government, for that matter: without any federal program or funding to help adults with mental illness, my brother's care was the purview of the Cuyahoga County Board of Mental Retardation and Developmental Disabilities (CCBMRDD). When the agency failed to find my brother employment, failed to authorize personnel to provide in-home care in a timely manner, failed to help him pass the driving test, and failed to arrange for transportation for him to and from work, it became my mother's full-time job to handle these and other matters. Single-handedly she found him multiple jobs (and ones that even he liked), found caretakers for him on Craigslist, did her best to help him pass the driving exam, and continues to this day to wake up in the middle of the night to drive him thirty minutes each way to and from downtown Cleveland so that he can work. With all of the additional stress this extra full-time job incurs on them, I now worry just as much about my parents as I do about my brother. CCBMRDD does not.

Hoping to grow my business and alleviate some of the financial burden on my family, I decided to have my company apply to sell software and consulting services to the federal government in 2005. My application was never granted. Instead, in the process, I found a flaw in a vital federal database system linked to the Department of Defense, and for a variety of reasons including a possible link between the database vendor and a widely-publicized federal corruption trial, I quickly found myself facing the possibility of criminal prosecution for reporting the flaw to a federal Inspector General. On top of my medical expenses, I paid my exorbitant legal defense fees out of pocket to protect the 400,000 American businesses in the database, including the Fortune 500, and my own.

For all these reasons and more—such as the Bush administration's decidedly anti-intellectual bent, which has led to the ban on federal funding for embryonic stem cell research that might reveal important insights about autism, and the slashing of the NIH budget, directly impacting my father's ability to perform his research at Case in Cleveland; the pointless wars, sending my college roommate into active duty in Afghanistan multiple times to fight a never-ending battle against the Taliban, in which many of his friends were killed; the disgustingly "pro-business" (but anti-small business) policies that started with Enron's fall, that wasted billions of dollars on economic "stimulus" checks just as the price of oil spiked, and that eventually caused an economic cataclysm so large that entire nations failed—my view of the world as a young adult has been something less than optimistic. What I am coming to realize, however, is what Alan Greenspan apparently did not: that the world can change. And while his status in Washington shielded him from clear signals of change for the worse for many years, we don't have to make the same mistake as conditions finally have the opportunity to improve.

After an excruciatingly long wait, we are finally at the end of a dark era in our nation's history. With some luck and good voter turnout, the people who ran things before will not be the same people who run them come January, and the country will begin to rebuild. In some places, such as New Orleans, the rebuilding will be physical. But for most of us—those of us just trying to get by, and even those of us who were once titans, demigods and oracles—that process will mostly be a mental one, as we all re-think our models of the world.

The fact that it's been a rough eight years does not excuse Alan Greenspan's mistakes as Fed Chairman or his flawed perspective, but it does emphasize just how rough it's been. The White House under George W. Bush facilitated the creation of a massive government so corrupt at its core that greed, hypocrisy and apathy metastasized into virtually every corner of our lives, often invisibly. It will take some effort to wake up from the nightmare, and it will take the declassification of millions of documents to eventually understand its full extent and impact.

For now, we simply need to hope for the best on election day. That way, on November 5th, we can start thinking about what's possible.

Aaron Greenspan is the CEO of Think Computer Corporation and author of Authoritas: One Student's Harvard Admissions and the Founding of the Facebook Era. He is the creator of the FaceCash mobile payment system, ThinkLink business management system, and PlainSite legal transparency project.

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