Exceptional intelligence and uncompromising personal integrity. Rest In Peace, Dr. Volcker. You possessed qualities that are sorely needed in today's world.
Could’ve you find a better photo??
1
Paul Volcker will forever be the man who rescued the american economy from its own excesses.
1
Volcker was the literal and figurative Fed leader of our times.
And the Feds policy now has allowed the loosening of Volcker rule and Dodd-Frank, due to Bankers' greed and a mounting deficit in the trillions, subsidized by the Fed and Mnuchin at the Treasury, is allowing the probability of another recession without a feasible backstop.
"Mr. Volcker was summoned to meet the president at the White House. Mr. Volcker recounts in his memoirs, published in October 2018, that Reagan sat silently while his chief of staff, James A. Baker III, delivered a blunt message: “The president is ordering you not to raise interest rates before the election.”"
There you have it - Reagan and Trump, just the same. Demanding something from what should be an independent agency. Reagan was just smoother.
2
Mr. Volcker made me a dentist. Graduating college in 1982 there were no jobs. I ended up in dental school.
The Law of Unintended Consequences.
2
Mr. Volcker was and always will be a giant. Gifted. Respected. Honest. A good man. Those of us who lived during and after his time at the helm should be most grateful. I certainly am.
1
Where have you gone, Paul Volker, a nation turns its lonely eyes to you.
Apologies to Paul Simon.
Mr. Volcker was a true civil servant.
2
As someone who works in government and received a MPA from one the elite public administration schools, I have always admired Volcker for the exact same reason-he refused to bend to the feckless political winds of the day and the politicians who blew them. He believed he was right, and he set out to prove it.
Yes it was painful to Americans, but except for the hiccup of the Great Recession, we have 40+ years of economic stability, and had Volcker remained at the Fed (or somewhere of influence in government) the GR may not have been as severe.
He really was one of the best and the brightest.
2
The last honest man at the fed. You were right about everything but Bretton Woods, perhaps given the chance to rewrite policy you would have been right about that as well; as it is the dissolution of Bretton Woods, deregulation that followed, foreign policy disasters to benefit special interests and the allowance of Milton Friedman into the hen house has brought about the slow demise of America and America’s Middle Class. RIP Mr. Volcker.
Volker stood for what he believed in and did not worry so much about the political or public relations impact of his actions. Under his watch, the Fed truly acted as an independent arbiter of how to guide policy to serve America’s best long term interests. He also had the foresight and courage so lacking in some of his brethren to make tough decisions. If he were Fed Chairman in 2000-2007, the impact of the mortgage markets run amok would have been much more muted than the catastrophe that Greenspan oversaw.
The fact that the Fed today can be influenced by the President (yes I am referring to you Jerome Powell and all the late cycle stimulus you are promulgating) is not as bad as Trump asking Ukraine to investigate Biden - but it is awful and not something Volker would ever have stood for.
History will look upon you kindly Mr. Volker; you will be missed.
2
Paul Volker was a true gentleman and a real Renaissance man. When I was young and a nobody, I was a reporter for German television. Our editor in chief really wanted an interview with Paul Volcker with regards to the Independent Committee of Eminent Persons. He not only found the time to sit down for an exclusive on-camera interview with me but was extremely gracious with both his insights and his time given I was a cub reporter who rattled on with one question after another. He towered above me both in stature and experience and yet he could not have been nicer. I went on to write for The New York Times and broadcast for NPR from overseas and interviewed many famous public officials but he remains a favorite, not just for his knowledge but also his kindness. I hope his family sees this as I too mourn the loss of a class act. It's a cliche but true: They don't make them like this anymore. May he rest In peace.
2
Say what you will about old white men in smoke-filled back rooms, I hope we haven't seen the last of sober, honorable Democrats who believe both in capitalism and the necessity and our ability to channel it to fit the time and place with a clear-eyed understanding of where it is succeeding and where it is failing, and what rational things we could actually get a supermajority in a constitutional democratic republican government to agree to do to increase everyone's opportunity to more fully realize the potential of their life, liberty and pursuit of happiness.
Thank you, Chair Volcker, and thank you, President Carter. I pray we see even-handed decency like yours leading the world at our nation's helm again soon.
8
Employment and high wages are more important than low inflation. We've had low inflation because of outsourcing to foreign countries with cheap labor and a huge influx of foreigners willing to work for low wages. If Volcker had never come along we would have had low inflation eventually because of the two trends cited.
People forget that the middle class and working class were much better off in the seventies with higher inflation than today. People also forget that the rise in oil prices in the seventies (remember gas lines?) caused the cost of production to go up for basically everything, so Volcker's tactics only served to cause unemployment. It also cost Carter his job. Carter was a good man but very naive.
Outsourcing and the influx of foreigners would have killed inflation. Volcker just made things worse.
How do we know this death was not caused by Trump or the deep state? Seems like an odd coincidence that it occurred Sunday.
1
I was struck by Jimmy Carter's kind words about a man who arguably cost him a 2nd term. What a difference from the current occupant of the White House.
9
George Tames photo of Volcker with the beard of smoke captured something essential in the man--intellectual discipline enveloped in the common attire of the market.
4
Jimmy Carter KNEW Volker would do the right thing with interest rates, thereby undermining his reelection, and appointed anyway...because the right thing sometimes needs to be done however painful.
Imagine that happening today in any way shape for form.
11
Some economists have argued that the inflation could have been halted with a less severe recession.
The smartest thing that Ronald Reagan ever did was to retain Mr. Volcker at the Fed.
6
Paul Volcker was an amazingly selfless and competent public servant of the type that the Democrats appoint.
The Republicans don't.
6
I was a resident of International House, NYC from 2001-2004. Paul Volker was a board member and frequently spoke at and attended events at I- House. I remember him as a particularly warm and personable man who went out of his way to make the I- House community feel appreciated. He was so modest that I didn't realize until after I left I- House what an important role he has as an economist and government official. am very thankful to have met him and to have experienced his kindness and warmth towards everyone including myself.
8
AN excellent obit for a very complex man. Thanks.
7
"But the big New York banks, with the support of the Reagan administration, kept pressing for permission to re-enter the business of securities trading for the first time since the Great Depression."
Inflation was so rampant in the 1970's and Volker's moves were effective.
Regarding the above quote: this was the beginning of the end of the Glass-Steagll Act of 1933 that separated investment banking from retail banking. The prime result of this is now to allow banks so much freedom from the Fed. It led to the 2008 crisis and will do so again. Reagan started us on the path to what we see today - lack of taxes on the richest and economic inequity. People who think that the stock market won't eventually crash again are only fooling themselves. What is going on today is similar to the run-up to the crash of 1929.
10
@Liz Adams
Bill Clinton nailed the coffin shut on the Glass-Steagall Act when he signed into law the the Gramm-Leach-Bliley Act, which he blithely said should rightly be called the "Hoover Act". How right he was.
Along with the Iran hostage crisis, allegedly prolonged by conspirators in the Reagan presidential campaign who wanted to delay release until after the 1980 election, Paul Volcker destroyed the Carter presidency with insanely high interest rates that effectively crippled the economy. He was no hero.
1
Volcker's epitaph is incomplete without celebrating his courage and independence. The ubiquitous cigar speaks volumes. Obnoxious, but characteristic Volcker. Doing things his way, which were mostly correct. We have lost a smart, insightful public servant. Beholder to higher values, not snarky politicians.
5
Sensational photo of Mr. Volcker with a cigar. Looks a little bit like santa claus.
4
Volker is a testament to what one can accomplish if one doesn’t care what other people think.
6
Wonderful read, thank you
3
Cutting my teeth in economics at the FRBNY under the stewardship of an inspiring economist & president.....R.I.P.
Paul Volcker
3
In the arena of public service it's no exaggeration to say that Paul Volcker
was a towering figure [at 6'8"]who left his wisdom & footprint in the fields of economics and monetary
theory & policy.
5
A true public servant his whole life, notwithstanding his Wall Street employment. A fine man and a fine example of the best that America can produce, when it wants to.
4
A lot better than Greenspan
4
The annals of American history during the 20th century and early 21st century are filled with relatively unheralded people who made a huge positive difference in the life of this nation.
Paul Volcker was one of them. This man's clarity of thought and purpose as chairman of the Federal Reserve Board was the primary reason that our country excised the inflation demon of the 1970s. His determination to squeeze it out has been the driver of decades of monetary stability, not only for the U.S. but for our allies around the world.
Volcker was not swayed by the machinations of the financiers. He was not intimidated by the political desires of presidents, senators, or treasury secretaries. Volcker, knowing the Fed is independent, insisted that it do its job as the protector of the money supply and, importantly, the value of money.
Like George C. Marshall, Rachel Carson, John von Neumann, and Jonas Salk, he will long be remembered in history as a man who improved the lives of millions. May he rest in peace and may this nation honor his service by again celebrating the virtues of those who labor for the good of the public.
11
Well said
I have been a commercial banker for all of my professional career. Started in 1973 when commercial banking was an honorable profession and Mr. Volcker has always been an example of fiscal and economic rectitude. Had we bankers and businessmen heeded his continued advice and fortitude (even Though it created a lot of pain) we would not be in the mess both economical and political that we are today.
A great man.
9
In the early 80’s I was seated at a dinner table with Mr. Volker at an economic research institute in Texas. Volker was the keynote speaker. Looking forward to some conversation with the Fed Chief, I was disappointed that he grunted a greeting, then worked on his speech notes all through dinner. Afterward another dinner companion, a CEO of a major oil company, told me, “Every time Paul breathes a word, it affects economic policy all over the globe.” Volker remains one of my heroes even though he breathed nary a word at dinner that evening.
7
Volcker raised interest rates sky high. Housing prices went down during that period. Reagan came in in 1981. I knew he would be pro business, and low interest. He gave orders to Volcker to stop the punishingly high interest rates to stop inflation. Volcker obeyed. Since then home prices shot up like a rubber band and really never looked back. Now rates are low but no one can afford a house because the prices are so high. The only people who can get a decent home is to trade the pre 1981 house if they have one. I would have rathered high interest rates and low home prices. At least you can refinance interest rates when the rates fluctuate enough. But AFFORDABLE housing is key. Affordably to buy regardless of interest rates.
2
@Tom
Alternative history.
I graduated from college just as Volcker's inflation busting recession was taking hold.
Unable to find work in that field I returned to college and became a certified teacher.
While not at all happy at the time the second career has been an excellent fit.
If not for his strong medicine my grandparents, great-aunts and uncles and many others on fixed incomes would have been impoverished. Thanks Paul
6
Brilliant and principled man.
Also, that's one of the best obituary pictures I've ever seen
7
It's actually Anthony's wife writing. I was a banker during the time Paul Volcker was head of the Federal Reserve. Although I admire his ethics and commitment to an independent Fed, I believed then and still do, that the medicine was too harsh. That 21% prime rate catapulted a lot of previously solid companies that I had as clients into precarious financial condition, and a few cases, resulted in their bankruptcies. Yes, inflation was a serious problem that had to be addressed, but the harshness of the chosen remedy caused great collateral damage that might been avoided had the cure been more gradually imposed.
2
So of all things I was a kid in high school when this guy was in power. This was 1981 or so and into 1982. I was just developing a very small understanding of economics and I was also developing a love for the New York Times, through which I learned so much about the world back then. I recall many articles about the severe recession of that era instigated by this gent, and the fiscal policies he championed. Back then my father owned a bar and advertised a job for a bartender. People with masters degrees applied, begging for a chance. This was not lost on me, and I have lived a very conservative life ever since, living a life below my means (by full of meaning and compassion for the plight of others). Thank you Mr. Volcker, thank you NY Times and thanks to my father: you all showed me the way.
4
Volker was on the level of Alexander Hamilton. He gave America what it needed by doing the right, even though it hurt. Hamilton convinced Congress to pay off war bonds even though many of them had been sold to speculators at deep discounts. He even convinced Congress to payoff state war debt. It was an incredible move by Hamilton. Volker was that kind of person. He did what had to be done. Later on Alan Greenspan did the opposite, dumping cheap money into the market and killing the old fashioned savings account. It wasn't necessary. We were lucky to have a Paul Volker. RIP.
5
Yes, he was an awesome figure in finance and economic policy, but he was also a tremendous supporter of environmental initiatives, particularly through his love of flyfishing. The flyrodding community will miss him.
2
A life well lived. Thank you, Paul.
3
Alan Greenspan couldn't carry Paul Volcker's ashtray.
R.I.P. Mr. Volcker.
12
Paul Volcker deserves praise for his work in defeating inflation. But there were casualties. I wanted to buy a house in the early 1980's. I had to wait for mortgage rates to drop to 11% before I could afford one (barely). If only I was house hunting now. Instead, I can't get a decent paying CD.
1
Now that’s a well written article. Thank you Mr. Appelbaum and Mr. Hershey.
3
He was the quintessential public servant of our time.His attempts to reorganize government and improve the civil service ranks as his one frustration. His wisdom and courage are badly missed.
6
Agree or disagree with Paul Volcker's position on the best way to manage American economic policy, you could not doubt his ethics, honesty and principles. I hope we are not watching the disappearance of such people in government service like Mr. Volcker.
107
@AGoldstein
You are so right. Just put Steve Mnuchin side by side with Volcker and ask yourself who stacks up on ethics, honesty and principles. Or Wilbur Ross, Elaine Chao, Betsey De Vos or even Bill Barr, let alone Scott Pruitt, Jim Flynn, or Paul Manafort. These Trump cabinet appointees are on and all without integrity, without values other than "me first," and without political principles beyond protecting and apologizing for their President, who in turn demands their complete loyalty and adulation.
9
Shocking as it is to modern eyes and ears, President Carter, in choosing Paul Volcker as Fed Chairman, strengthened the independence of the central bank from rank political interference, while also all but ending his chances to win a second term as President.
That would never happen today, sadly, but Mr. Volcker's passing marks a watershed moment in American economic history by his passionate attack on runaway inflation and his insistence that private sector banks should operate at least to a significant degree with the interests of the nation, not merely profit.
93
@PaulB67 Not one Republican Congressman is willing to stand up to Trump’s Soviet style spin on reality. The dems might squabble amongst themselves but they are able to deal with change.
12
I was 19 when President Carter appointed Mr. Volcker to head the Federal Reserve. That summer I was working at a drugstore to help my parents pay my college tuition. No matter how much I made in overtime, I could never keep up with the price of food and other necessities. Mr. Volker administered harsh medicine, and the recession was very painful, but it had to be done.
Mr. Appelbaum and Mr. Hershey, thank you very much for writing an outstanding obituary. In addition to learning a great deal about Mr. Volcker's life, I also learned a great deal about a period of history I lived through.
96
@Maryland Chris
I was 26 in 1980 and a Vice President at my company gave me a glowing Performance Appraisal. He said my work was so good, that I was getting an 8 per cent Salary increase.
The VP pointed out that not many people in the Company were getting such a large raise.
I pointed out that Inflation was running at TWELVE Per Cent that year.
"Well, Bob, I have no control over the Rate of Inflation", the VP told me.
5
@Maryland Chris ... and don't forget when bank CD's were paying 14% or more. That was legalized stealing if you bought one. I wish I had bought a 30 year one
5
@Maryland Chris
People forget how out of control inflation was -- energy prices just kept going up and we did not have the technology advances yet to manage the use .. let alone find more oil and gas.
The solution from government was more taxes -- I remember my dad was paying an effective tax rate of 70% on his income working in NYC . And the country and .. city especially was mess.
And people wonder why RR won over Carter
The time of the 1970s inflation was one of the most frightening moments of our history when it appeared as though our whole economic system was exploding as trust in values of every asset was collapsing along with a trust in our political systems to right the economy. It took not just Paul Volker’s self-confident courage to right the collapse with his “brute-force campaign,” but President Jimmy Carter’s risking his political reputation to not just bring in Volker, but stand behind him in the resulting economic pain that many had to live through.
Much of Ronald Reagan succeeding political success capitalized on those sacrifices.
111
@Max from Mass ...and that success has been squandered...
7
@Max from Mass
Thank you for pointing that out.
Unfortunately, not many persons of the Republican persuasion would admit to that. It would spoil the Myth that Reagan did not receive a big Gift from Mr. Volcker.
FULL DISCLOSURE: I voted for Ronald Reagan twice, in 1980 and 1984. He was the last Republican Presidential Nominee and President I voted for.
The way things are going, It will be a long time before I do so again.
9
@Max from Mass
Don't forget .. RR renominated him and he served -- effectively RR whole term.
RR changed the tax code -- and put SS on a better track. Unfortunately -- there have been no future updates ... needed updates.
His view on world trade was a bit off ---
Mr Volcker actually did the job that many Fed Chairman were supposed to do before him but didn't.
He was pretty simple, if the economy needed stimulus do it and it is overheated put out the flame.
It was not rocket science.
Since then the Fed has become fairly competent and independent.
RIP Paul.
5
Paul Volcker was a giant - fighting and beating inflation just in time to avoid an American Weimar Republic-
He was knowledgable and strong as can be.
Today, the world of finance seems to hoast a cast of 5 minute solutions at a dime a dozen.
Had the U.S. stayed on the gold standard we might me a tad less weathy but a lot more stable
Mr Volcker broke inflation with a sledge hammer. The Carter economy was growing, recovering from the Stagflation of the Nixon/Ford era. The OPEC cartel raised energy prices in the early 1970s, and the nation needed capital investment to get off of oil. The supply of natural gas was contracting due to over-regulation. But jobs were expanding at a good rate under Carter.
What the economy sorely needed was investment capital to get off of oil, improve efficiency, and expand alternate, domestic energy supplies. Instead, we got a prime rate as high as 21.5% that killed off economic activity, whether needed or not.
Voters directed their ire on Carter, and we wound up with Reagan. No wonder Trump always wants to remind us of the role of the Fed in the economy, and blame it for interest rates higher than necessary.
Yes, Paul Volcker won the war on inflation. With many, many American casualties.
32
@RM
Is there any evidence that if interest rates were low, investment capital would have been used to get off oil, improve efficiency, etc as you suggest?
Not clear that anyone talked the talk you suggest.
Tax breaks only brought stock buybacks.
Hard to predict economic behavior.
10
@Robert
I worked in public utility regulation in that era. Electric utilities were heavily dependent on oil fired generation and the utilities wanted to invest in alternate fuel generation. Due to high interest rates, many projects were planned, then cancelled.
5
@RM
I remember paying over 15% on a used car loan late in Carter's administration. I was able to move to a bigger city and work two jobs, which most rural people could not do. Also remember oil tankers waiting off the coast for prices to go up, greed hurting middle and lower economic class Americans. Yes people had to wait on big expenditures, but over time people saw the good in forcing inflation down. Knowing debt and paying huge sums of interest is a problem, whether personal or governmental, has been an issue since Reagan. Many older folks can remember Reagan's subsequent taxing of tips on the lowest of wage earners, which was harmful to waiters, waitresses, barbers, stylist's. Carter does not look so bad if you take an encompassing view.
19
What a wonderful man and a meaningful life. Rest In Peace Dear Chairman Volcker. I will always cherish the memory of the time I sat next to you on the Concorde from London and offered you my aisle sit to ease your discomfort.
4
I'm sorry, but taming 10% annual inflation with 10.8% unemployment is no victory and nothing to be proud off.
The pain that PV inflicted on Americans and businesses were very destructive.
And PV was completely wrong, and continued to be completely wrong for 3 decades, that large budget deficits would cause runaway inflation. There hasn't been inflation anywhere in the developed world in 3 decades - a period during which national debts in Japan, Europe and America skyrocketed.
If we had followed PV's prescription, for 3 decades we would be limiting our growth and full employment with tighter fiscal policy for no reason whatsoever.
Presidents Reagan and Trump were/are right. The Fed's outdated orthodoxy is an impediment to growth and employment. Thank heaven that Reagan and Trump brown-beat the Fed into backing down from ruinous interest rate increases.
3
@Baron95
If large budget deficits are not harmful, why did presidents Reagan and Trump both campaign with a promise of cutting them?
3
@Baron95: So, you seem to think enormous budget deficits are not a problem. Debt can be accrued without any consideration of how to pay it back. That’s interesting, and will make for a fascinating tale to tell the future generations as they squirm under the crushing financial catastrophe they will have to face.
4
@J Carlson
"If large budget deficits are not harmful, why did presidents Reagan and Trump both campaign with a promise of cutting them?"
Because the public and most old school economists are confused and think "balancing the federal budget" sounds good.
Just like most people and doctors believe that drinking cow milk is good for American adults.
Will men and women like Paul Volcker ever again foreswear large salaried private jobs and flock to government service in the numbers they did in the post-WWII years given the efforts of extremists on both sides— the likes of Democratic Socialists and what currently casts itself as the Republican Party— casting men like him as the enemy?
1
Volcker's economic policies devastated my working-class neighborhood and via the resulting economic turmoil pretty much destroyed my childhood. I don't see the economists of his era as heroes, but as an insider's club of elites who were more than willing to let one economic group do a lot of suffering so that another economic group could sleep at night. It's hard to forgive this generation of economists for the amount of human misery they caused and were willing to accept.
5
Thank you for your service, Mr. Volcker. RIP.
4
Lots of folks use public service now as a way to get ahead in their own careers not for away to give back to the country. No one thanks their Congressman for their public service as they do a soldier. We expect Congressional representatives to cash in after their public service and too often they don’t disappoint us.
3
Paul Volker was the antithesis of the Trump, Reagan and many other "but will it get me elected/reelected?" so-called "public servants" of both parties who are in reality controlled by the big money interests.
When the whole economic house of cards they have created inevitably collapses I hope a Paul Volker like person can be found to try to rebuild what the so called "public servants" have wrecked over the last 40 years.
7
Whats' with the picture of him smoking? Weird choice - seems like there are more important things to highlight.
15
@Locker77, Volker was a famous for his cigar as Groucho Marx.
@Locker77
That is how I remember him.
Smokers don't often make it to 92.
10
"In the 1960s, when the driver’s seat in his Nash Rambler collapsed, Mr. Volcker propped it up with a chair and continued to drive the car."
Perhaps a minor point, but I'm having trouble with the visual. Does the writer mean that he replaced the seat with a chair? If not, a bit more detail, please. A Nash doesn't have much room for both a seat and a recliner, or kitchen chair, for that matter. Thanks.
2
We sorely need the voice of Paul Volker now. 22 trillion in debt and and an enraged clown at the helm and a deteriorating public culture while the country snacks on the sugar high of spending to support growing public debt. yes we are in a mess.
9
@ConservativesDefeated
There are not any people around today in civil service who are cut from the same cloth as Mr. Volcker. Needless to say there sure ain't any in today's government. Our present run-away-debt (how many trillions?) does not cause a ripple of angst from our 'very talented-many times bankrupt-deal maker' President. This mess as Mr. Volcker rightfully named it is cheered on by the very people who will be 'very badly' (Trump talk) effected by it. Rest in Peace Mr. Volcker. We will miss you.
4
A towering figure and a class act. We all thought inflation was here to stay back then, and then Volcker came in and took the tough decisions. Too bad these days he’d be written off as a “deep state” traitor by the flunkies and hacks running the White House and the Republican Party. Who says technocrats can’t do anything right? IMHO, the more Volkers, the better.
7
Our country desperately needs more Paul Volckers: smart, dedicated, apolitical technocrats whose guiding light is the common good.
8
Of all the pictures they could have chosen of him they chose that one? Why? Poor decision.
10
What is the purpose of an obituary photo with the man's face surrounded by cigar smoke. Let's try a different image.
9
I question the selection of this photograph, unless it was Mr. Volcker's personal favorite and his express wish to be used for his obituary.
9
A great man dedicated to his process. It is too bad he exposed the people who lived and worked around him to second and third hand smoke long after he, as an educated and intelligent man, knew his addiction was putting carginogens into the lungs of other people.
2
Surely the NYT could have selected a better photo for this obit. Or did the editor decide to make an anti-smoking statement?
4
I absolutely LOVE the photograph of Paul Volcker - surrounded by a fog of smoke - as he literally sucks on a cigarette -- while having lived to the ripe age of 92 -
One wonders how many Times readers - who had made a New Year's resolution to improve their health by quitting smoking - will reconsider after having seen this picture
Hmmm...
4
why does the NY Times choose a photo that shows Mr. Volcker clouded in cigarette smoke? Why the disrespect?
5
A name from my youth. He influenced the money I made during most of my life. Looking at this picture, I was surprised to see he lived to 92.
1
As a work of photography, the picture of Paul Volker is excellent. As a picture of Paul Volker, it is not.
5
An exemplary civil servant. RIP.
4
No one under 45 really remembers the fear of life with chronic double-digit inflation...
To me, that's scary. It's as if they've lived in this veritable paradise all this time thinking that this is the way things are and always will be because that's the way it has been their entire living memories.
Yet, the fragility of that reality scares those of us who are older because we know what can happen and have seen it.
In a way, I am thankful for the Great Recession because it returned fear, but, as the old die off and the young become adults with no memories of the dangerous past, they will eventually repeat it. This is why it is imperative to create laws and regulations (such as The Volcker Rule) to prevent such circumstances from recurring. Furthermore, we must remain vigilant against politicians who would erode those protections or, worse, promote those very circumstances that will return us to a disastrous economy.
15
Mr. Volcker was no doubt extremely intelligent, principled and independent. For those reasons, he deserves many kudos. But I remember how bad the recession of the early 1980s was and how high interest rates went. "Stagflation" they called it. A friend of ours bought a house with a mortgage rate of 18.5%. I worked for a leasing company that had to deal with prime over 21%. No one wanted to buy a new car. Many, many people were out of work and they and their families suffered drastically. By the time my husband and I bought a house in late fall 1983, mortgage rates were "down" to 13-3/4%. Was it worth it? Was inflation such a monster that it had to be slayed at the cost of the livelihoods of millions? To bring the real estate and so many other markets to its knees? I guess I am among the few commenters here who say: I don't think so.
4
@JenD
Yes, it was worth it because they brought it to it’s knees only temporarily and then it was healthy. It is like having surgery. Would would rather decades of suffering like Argentina.
I ran a company that was devastated by Volcker's blitzkrieg against stagflation from 1979 to 1983. Like open heart surgery, it was drastic and, ultimlately, successful.
Some credit should be given to President Reagan, whose 1980 election was greatly assisted by soaring interest rates and unemployment, as Volcker sought to 'kill the beast.'
Reagan had no grasp of economics. However, he met with Volcker and supported his draconial measures. While Republicans lamented the short-term political damage, Reagan stood firm, while his presidential rating dipped to 35% and the 1982 Congressional elections went to the Democrats. Ultimately, the economy settled down to a moderate pace and Reagan won handily in 1984 with the slogan MORNING HAS COME TO AMERICA.
Reagan had already become testy with Volcker for critizing his large deficits, but the stagflation threat had been eliminated.
2
Volker and Reagan successfully steered the Country out of the Ford inflation and Carter malaise. Tip O’Neil and the Democratic Congress fought them every single step of the way. Within two years, however, inflation was on the way down and GDP growth was soaring. Sound familiar? Dems seem to always find themselves on the wrong side of history.
2
@William Could be time to recalibrate that prism through which you see history, or, perhaps you just have selective memory loss/retention.
3
@William - As the article noted, Carter made the decision to hire Volcker and follow his remedies, Reagan ordered him to stop his remedies so Reagan could be reelected, putting politics ahead of policy. That you could use a set of facts to prove the opposite of those facts says much about current conservative practices. Your fealty to Reagan is cute - given that everything he stood for has been savaged by the Trump crime family, turning Reagan's political philosophies into artifacts of the past that are utterly abandoned. The modern GOP philosophy is simple - what's good for Trump's fragile, toxic ego and his mysterious pocketbook is what's good for the GOP and America. Reagan doesn't exist anymore in Trump World/GOP World.
4
Strange picture choice. It makes Volcker look like a defiant tobacco lobbyist.
9
The epitome of a great public servant. RIP Mr. Volker. A towering figure [both literally and figuratively] in the world of finance.
11
There are very few men and women nowdays who are willing to dedicate their lives to the public service. But he did it, inspite of suffering great personal and professional costs.
5
Paul Volker didn’t wage war on inflation, he waged war on the American working class. 1982 was the year that broke my hometown, Cleveland, Ohio. That was the year that all those abandoned factories so popular today as lofts were abandoned. I still remember the thousands of men and women that walked out of those modern day ghost ships every day. I mostly remember the savagery of putting those guys all out of work at the same time. 1982 was also the year my church started its Sunday Lunch Ministry as a temporary measure until the economy got better and families got back on their feet.
The Sunday meals never ended.
19
@Walter Bruckner
Please tell us how how inflation and interest rates helped the working class.
7
@Walter Bruckner
It also destroyed the timber towns here and steel towns in Pennsylvania, among others. The highest unemployment rates since the Great Depression occurred in 1982-83. See the data at the Bureau of Labor Statistcs or the St. Louis Fed - Nov. 1982 had an unemployment rate of 10.8%, higher than the Great Recession peak of 10% in September 2009. Middle-aged loggers here had to retrain and start over, and state populations shrank as people moved elsewhere, most never returned. The urban-rural divide started in earnest back then, not recently.
8
@EGD
*how HIGH inflation...
3
One thing is clear the tax cut in 2017 unleashed a unprecedented growth in the national debt. Even while the economy was growing. The need to reign in wealth accumulation of the richest Americans is an urgent need. Volcker had it right. Volcker's stint as Fed chair is historic. The recession that helped Reagan win the election ushered in efforts to defang financial regulation. So Volcker led the US into a long run of growth. But he was disappointed because the seeds for the 2008 recession were being planted.
11
@c harris ,,, don't worry about it-trump says it's easy to negotiate away the national debt, and he's the one who is going to do it.
We were lucky to have his service. We need more Paul Volcker in this world!
I think the paper could have found a better picture of him for the top of the article! yeesh!
10
Marvelous tribute for a great public servant. Also good work on recently America economic history.
8
Paul Volcker is viewed by many if not most financial and academic professionals as among the competent Chairman of the Fed. We’ll not likely see his equal in our lifetimes. He was a consummate
“Professional” in his long service to America. And will be long remembered for distinguished public service.
10
@Peter I Bermam:
Volcker slayed the stagflation dragon, Ben Bernanke slayed the Great Recession. Historically high interest rates and QE were both untested theories of how to fix the economy. Both succeeded.
1
I'm not sure if it says something very good about you or very bad about you when a recession is given your name.
5
When I graduated from college in 1980, I bought a new VW Rabbit for the princely sum of $5950 and it was financed at 12% through a credit union.
I asked my father’s best friend, a top car dealer, if that was a good rate, He responded, ‘Yes, a great rate. I write loans all day long at 19 and 20 percent.’
Volker’s efforts saved consumers billions over many years.
(I always wondered if some mortgages at 14% were never refinanced for whatever reason and people simply paid off the high-interest loan over 30 years.)
5
If only this nation could elect another straight up decent, qualified president the likes of Jimmy Carter and relish sane, smart federal appointments. We got another glimpse of sane center policies in 1992-2000 that erased the national debt, but it didn't last - bookended by warrior traitorous military ilk running the show.
Current Trumpista sorry state of the nation = Reagan/Bush redux. on Putin steroids. The British papers in 2004 asked the salient question, “How can 59,054,087 people be so DUMB?" It would've been just as relevant in 2000. Yet, as of 2016 that climbed to 63 million.
3
Why are we celebrating a man who insisted -- and implemented policies guaranteeing -- that “The standard of living of the average American has to decline."
8
@JS Because the increase in the standard of living was all accomplished via the newly introduced phenomenon known as credit card debt.
Prior to 1975, credit cards were basically non-existent.
You have Master Card and Visa to thank, not Paul Volcker - he saved your (and my) shirt.
@David Caldwell The standard of living had been improving for decades (emphatically since the end of WWII), yet credit cards only appeared on the scene once wages had stagnated in the 1970s. Faced with the choice of challenging big business and finance or workers, Volcker went after the workers.
6
In reading this obituary I am struck by the difference in educational achievement and expertise between two public servants who appeared in articles in the paper today: Mr. Volker and Ms. Carla Sands, the United States ambassador to Denmark, who was reported to have barred an American NATO expert critical of President Trump from speaking at an international conference hosted by the American embassy.
As described in the obituary, Mr. Volker was graduated from Princeton with a new major that combined the study of economics, politics and history. His senior thesis was topic was the Federal Reserve. He earned a master’s degree at the Kennedy School of Government at Harvard and completed his doctoral thesis at the London School of Economics.
Ms. Sands studied fine art at Indiana University of Pennsylvania and history of art at Elizabethtown College, but was graduated from neither. She later attended Life Chiropractic College, now Life University, and earned a degree in chiropractic. Prior to heading the US embassy in Demark she pursued an acting career, worked as a chiropractor and, upon her husband’s death, took over his private investment firm, donating nearly a quarter million dollars and organizing high-dollar fundraisers for Donald Trump's presidential campaign and giving $100,000 to President Donald Trump's inaugural committee.
28
@DRK
Ambassadorships are usually given to people who have made generous donations to the President in office or to his party, or who have some connection other than a relevant resume. For example: Claire Booth Luce, Shirley Temple Black, Jean Kennedy Smith, Pamela Churchill Harriman, Sondland, Terry Branstad. The Branstad appointment to China does bother me a lot. He was governor of Iowa because of being supported by the very wealthy Marvin Pomerantz. Our relationship with China requires a person with diplomatic experience, not a figurehead.
The American ambassador to South Africa is an unqualified handbag designer. It is too terrible.
1
She still has a few years to go before appearing in an obituary, too.
His life is an example of what it means to be a public servant. He was a great man!
6
Those who say Mr. Volker was a "good man" underestimate him. He was an extraordinarily powerful man. His anti-inflation policy raises the moral problem of "dirty hands": Can actions by a powerful person that cause a lot of harm be justified in ways that are different from those of ordinary people?
5
@Aaron Lercher
Power in the hands of a man who doesn’t have the courage to do his job is power dangerously deployed to the wrong hands. I see no moral problem here at all. He is not a physician who has taken an oath to do no harm. He is ethically free to pursue the greatest good for the greatest number of people without being burdened by any individual duty to whatever persons happen to not be in that number.
Volker and Carter offer an example that cuts both ways. They did the right thing for the country at that time even though the political cost was steep and led to Carter being a one term President. There is clear evidence that the GOP saw this as a cautionary tale rather than a profile in courage. How sad for our country that the courageous are not rewarded by voters but the corrupt and cowards are.
12
@Ted
people always vote with their pocket books. trump over bernie anyday.
1
Economics is not a science.
Economists are not scientists.
There are too many variables and unknowns to craft the double-blind/randomized controlled experimental tests that provide predictable and repeatable results that are the essence of science.
Economists are akin to astrologers, charlatans, fortune tellers, gamblers, journalists, lawyers, oracles, politicians, preachers, pundits, readers, snake oil salesmen and soothsayers.
And using the metaphor of war for any economic policy and practice is ludicrous.
4
@Blackmamba
Uh, astronomy is an observational science.
It would be better to ask “What are the great success stories of Economics?”
This may be one of them.
3
@Blackmamba Science must have a theory that gives a refutable hypothesis and an experiment for testing it.
Well, one of econ's theories led to the testable hypothesis that if you raise interest rates, inflation comes down. Looks like it was right. Someone here doesn't know what science is, but it doesn't sound like it's the economists.
3
@Robert
Uh astronomy is a science based upon chemistry and physics.
What is observed with the exception of the speed of light varies relative to mass, speed and distance.
The great success story of economics is posing as a science.
There isn't a Nobel Prize in Economic Science. There is the Swedish National Bank Prize in memory of Alfred Nobel.
2
RIP Paul Volker. You served your country well.
6
Trillion dollar deficits, I meant.
1
Wow, a big man in Finance. And he lasted a full 92 years despite the cloud of cigar smoke as evidenced by the obit photo. I wonder what he looked like behind the smoke! Yikes!
5
That’s one great photograph of him!
6
PV: "The only innovation the finance industry has created is the ATM"
5
A great Fed chair. A compelling personaiity, and character/integrity to spare.
3
What a shame Paul Volcker will not be available to advise Pres. Elizabeth Warren. RIP, Mr. Volcker, you were a true patriot.
5
@me She would not listen.
1
Paul Volcker helped start the greatest economic boom in U.S. history. I would make the case that Reaganomics should have been coined Volckernomics. The Reagan administration's tax cuts were fine but the real reason for the most impressive increase in financial assets in history was Paul Volckers aggressive Fed policy to break the back of Inflation. Stocks and bonds continue in a massive multi generational bull market (that's probably over soon - but that's another story). Paul Volcker's intelligence and independence and aggressiveness deserve a lot more credit.
60
@Mike Curtis Oh yeah, Volcker was the secret that Reagan's appointee Allan Greenspan weaponized for the Neo-Liberal Revolution ie. Reagonomics. [not]
@Newsbuoy
I take Mike Curtis' point to be that Reaganomics (tax cuts for the rich and wait for overflow from their wild celebrations to "trickle down") is not what made the 1980s the economic boom time we remember it as, but rather it was thanks to Paul Volcker.
And, by extension, President Jimmy Carter, and his guileless pick of someone "insufficiently political," i.e. there to get the job done for the country, not to serve the electoral chances, partisan ideologies and personal enrichment of the president and his cronies.
Had Jimmy Carter won reelection and without Reagan's debt-ballooning tax cuts and time-bomb deregulation, inflation would have subsided by the end of Carter's second term and it would be he and his administration's responsible competence and not Reagan and his administration's conspicuous consumption that would be remembered as saving the economy.
That also would have allowed Carter to fulfill his energy policy, which combined efficiency upgrades with responsible conservation and a moonshot to accelerate development of renewable energy and electric cars by 1990.
Imagine an '80s where we didn't lose our manufacturing base and auto market share to Japan but built smarter ourselves. Imagine a '90s where there's less incentive to start wars for oil. Imagine a '00s where Osama bin Laden sees no reason to attack us on 9/11, and Bush has no excuse for war in Iraq. Imagine a '10s where climate change has been headed off.
But no, instead we got Reaganomics.
13
I was a junior banker in the early 1980's and remember very clearly the days of the prime rate at 20+%. In my little corner of the finance world, all our lending to small businesses was done on a Prime - plus basis, meaning that even our best customers were paying rates of 21 % and more for short-term debt. It was a very tough time for both borrowers and lenders but by the end of the Reagan era across the board inflation in the U.S. was essentially under control and remains so to this day.
4
Our condolences to the Volcker family. Paul was a grand American and a terrific human being with a splendid sense of humor and unflagging honesty.
In years of dealing with foreign affairs, I worked for two very tall Americans. When I met the first one, later a friend, he stood so tall that I asked how's the weather up there. In the 1990s, I had the luck to work for a blue ribbon commission of which Paul was a member. He leaned over to talk to us short mortals so as not to intimidate anyone.
My fondest memory: he called late at night (our time) from Europe to fix the commission's final report, which I had drafted. Started with a complement but then said you don't know much about macro-economics ("haven't a clue" would have been more precise.) Paul dictated two or three diamond cut paragraphs to place Asia's burgeoning economy in global context. Told me, with a chuckle, "have a good sleep".
Permit me to offer a correction to the Time's thoughtful obituary. Mr. Volcker did not fight "a losing struggle" to preserve the Bretton Woods monetary system. He helped Nixon take us off the gold standard, which preserved a world economic order first established at Bretton Woods.
His mark of greatness, taming American inflation, happened in spite of the fact he was a Democrat. We can't know but President Carter might even have won re-election were it not for the Iranian hostages. Fortunately, the Fed's independence established by Volcker lives on, when we most need it.
18
One important reason some folks like myself and my family have what we do is because we were able to be enormous net savers in the period overeseen by Volker's economic policies. I am grateful for that.
8
@Dhraiden
Interesting comment! It addresses in part, how to bear the pain under a Volcker policy.
1
A giant in public service and a steadfast believer in sound finance. The US was lucky to have him when he was needed. Who is going to have the courage to step up and fix the problems that loose money, excessive debt and failed leadership are creating?
8
Paul Volcker was the speaker at my graduation. Three months later, I was working for him (though far, far below him).
I remember that a lot of farmers had sent him bricks and blocks of wood in protest at the tightening / interest rate rise during the beginning of his term at the Fed. The mementos were still present in a number of offices when I was there.
The funniest thing I remember is walking down a hallway with a friend during a Christmas party. She had a stuffed parrot on her shoulder and we were cracking silly jokes. We got to the end of the hall, to notice that Volcker was walking behind us. He didn't say anything, but I'm sure he was thinking, "Kids today." (And maybe, "I was like that once.")
Was he perfect? No. But he was intelligent, and he did what he felt was in the country's best interest. I don't see much of that in Washington these days.
15
Dr. Volcker remains the dominant figure in post-WW2 domestic American banking. His strong approach towards monetary policy remains vindicated, compared to that of the 'Chicago School' ("trickle down" / "supplyside") that in the words of Dr Greenspan upon our financial collapse in 2007-8 "my model of 30 years appears to have a flaw".
Today, with the Trump-Pence administration's return to 'anything goes' regulations, the valid approach of Dr Volcker is being over-turned. The rhyme of history (a.k.a. hubris of man) points to another financial industry collapse.
10
I worked for Chairman Volcker for the 3 years before Alan Greenspan replaced him. Chairman Volcker was not only a brilliant economist, he was an incredibly decent human being. RIP, Mr. Chairman!
38
Wow. 92. I'm taking up cigars again. RIP Mr. Volcker.
10
The steps needed to curb 'stagflation' were temporary and should have been reversed at some point...Just as the need to double FICA to 'build up a surplus' needs to end.
What has resulted by keeping both in place is the nation's GDP increasing at THREE TIMES the rate of incomes, thereby creating poverty where it would not otherwise exist.
As a result, the American Covenant of "Work hard, play by the rules and grow with the country!" has been discarded. A 'rising tide' has, in practice, raised some boats far more than the rest of the fleet. How else does a rising national income not induce an increased in incomes?
He did the right things for then but we've kept them in place for far too long.
1
Very, very sad. Paul Volcker was, in my opinion, the greatest public servant in modern American history. Brilliance, integrity and honesty personified, and delightful wit to boot. He was deeply troubled about the current state of public life. If he had been reappointed as Fed chairman there would never have been a "Great Recession." Unlike his laissez-faire successor, Alan Greenspan, he knew that banks and Wall Street had to be closely watched and regulated. Paul, you will be sorely missed. R.I.P.
17
@Phil Zweig: I would say second only to George C. Marshall, but I am quibbling: Marshall and Volcker were two exceptional and visionary public servants. Not many around these days.
1
Mr. Volcker was responsible for successfully controlling Reagan’s Star Wars Initiative’s impact on our economy which bankrupted Russia and led to German reunification.
In my opinion, without Paul Volcker’s reigning in of Reagan, his presidency would have ended in failure.
3
The "smoke and mirror" photograph of Volcker is worth a thousands words. Volcker's understanding how to address inflation was based on the idea that banks should make more money by lending less. The opposite is true: Banks make money by lending it. Each time they lend to Peter to pay Paul they create new markets which creates new borrowers and lenders. What Volcker did was to create a system of economic hydraulics that would protect the wealthy lenders and deprive the striving borrowers of a level playing field. Today's income disparity and union busting is all part of the Volcker smoke-and-mirror con job.
14
Job well done Paul. Rest in peace.
14
Volcker had the courage to push us into recession to break inflation. That is, he made the standard of living lower to stabilize the US economy.
Nowadays. it it not possible to tell or make any population, and the US in particular, to accept less. What everyone demands is more. And more is often not possible or healthy.
Thus, we have excessive debt, deficits, selfishness, and even obesity.
This excess will be eventually be curtailed, painfully, by reality.
9
Sorry if I don't share people's grief over this man. I remember when Volcker said to the effect that Americans' standard of living had to decline. This of course meant everybody but the very rich. He was neoliberal like the rest of them, and we should know neoliberalism has created nothing but hardship for the vast majority of people.
11
@Susan Nunes
Social justice warrior small minds who know nothing of global economics might believe that.
However, Volcker is noted and appreciated worldwide for many intelligent forward thinking economic decisions, especially during the Carter admin to corral rampant recessionary inflation and high interest rates that were killing middle America and the new gen - Boomers - who entered adulthood in the 1970s but couldn't afford anything, let alone a home, car other than beat up VW, jobs, etc...
23
@Maggie I had a used Datsun.
1
Growing up I always looked to bankers as being rational, conservative, responsible and deliberate in the execution of their duties. Never would I have thought of them as being reckless as described by Paul Volcker. Boy was I ever wrong. Things haven't changed much either.
15
@John Warnock
Things haven't changed much, but remember: we used to regulate banking more heavily - for just that reason.
3
Paul Volcker, The, NY Times, Oct. 23, 2018 addressed the central issue of our time, and it is not inflation
(After discussing the 2% inflation target of the current Fed)
“I puzzle at the rationale..a 2 percent target, or limit, was not in my textbook years ago. I know of no theoretical justification.”
With a laugh, he told me that he believed the policy was driven by fears of deflation. “And we haven’t had any deflation in this country for 90 years!”
But there is something more worrisome affecting policy than fear, he told me. Money.
Over the din of traffic outside an open window, Mr. Volcker hoarsely sounded an alarm on the power it has to shape our culture and our politics.
“The central issue is we’re developing into a plutocracy,” he told me. “We’ve got an enormous number of enormously rich people that have convinced themselves that they’re rich because they’re smart and constructive. And they don’t like government, and they don’t like to pay taxes.”
82
Very few remember Paul Volcker and his impact on the American economy. And some people posting here are correct; we all thought double digit inflation was a permanent fixture of the American economy. I remember when my wife and I purchased our first house. The mortgage interest rates had "dropped" to a "reasonable" level of 10%. A very astute businessman I knew said "jump on those rates now because you will never see mortgage rates below 10% in our lifetime".
13
I have secondary-source personal anecdote about Mr Volcker.
When a female economist colleague of mine went to the NY Fed with a number of other women economists, Mr Volcker walked in to the room and said "Oh, what is this? A harem"
The women PhD's were not amused. This happened relatively recently.
8
@NYC -> Boston
I have great hopes that we are entering a world where it would not occur to a prominent man to make such an offensive remark.
In the world I grew up in, and lived most of my life in, any prominent man might be likely to make that remark.
5
Billion dollar deficits, twenty trillion dollars in federal debt, speculative run ups on the equity markets and everyone just shrugs. We need a young Mr. Volcker right now. He will be proven right. Again.
19
All I know is, back in the late 1970s, I thought double-digit inflation rates were a permanent fixture on the national scenery. Everybody else believed that also. The greatest government public policy achievement of the last 50 years was breaking what had been the hopeless cycle of endless inflation. Paul Volcker was responsible for that. He's one of the heroes of this country. Period.
54
@mpound
Jimmy Carter appointed him to do that, and lost re-election because he put the country above politics.
7
Thank you for your selfless service to America, Mr Volcker.
Oh how this country could use someone with your vision, intellect, and integrity.
RIP
37
@dave d Selfless, Dave?
"Mr. Volcker interlaced his long stretches of public service with a lucrative career on Wall Street, most prominently as chief executive of the investment bank Wolfensohn & Company."
The unions in their arrogance threw their support behind President Carter's mortal enemy Ted Kennedy. Carter rewarded them with the appointment of Mr. Volcker, the one man more than any other who broke the power of the industrial unions and made it possible for this country to have a future of innovation and investment instead of perpetual inflation and stagnation in a union-dominated slum like Britain and France.
11
I love all these people who want others to sacrifice while they keep there cushy jobs.Obviously mr.volker was of them.
8
@Warren katz Mr. Volker should have used a more measured and less draconian tightening of the money supply. Many, many people suffered lost jobs and lost job opportunities, had inability to buy houses or finance education, and many businesses suffered or failed. The early 80s were marked by a historically deep recession. If Mr. Volker and his colleagues at the Fed had more of their own or their families own skin in the game, their policies might have been different.
8
@Warren katz
An absurd, superificial comment with respect to a man who took a 50% pay cut when he left the NY Fed to be Fed Chair. And he did so with an ill wife and disabled son, who both remained in NY due to care needs. In other words: a 50% pay cut and the need to run two homes. No wonder he lived in an apartment building inhabited by college students while running the Federal Reserve. Oh, yeah, no sacrifice there. Oh, yeah—real cushy.
5
@Michael I am sorry, I didn't know Mr. Volker had an ill wife and disabled son. But his job still paid well as Fed Chair compared to most Americans, and I stand by my comment that the monetary policies of the Fed at the time were too strict. The deep recession of the 1980s had serious fallout for the economy and for people's lives. Inflation could have been decreased more gradually.
5
The general theme with some is that....yes....Paul Volcker killed inflation....BUT AT SUCH A HUGE COST! It took the courage of Paul Volcker to take the heat. His economic policies is what produced what some called "the Reagan economy." That is NONSENSE. It was the Volcker policies that resulted in an economic expansion from Reagan to Bush 41 to Clinton. Then tax cuts during the two Bush43 wars and tax cuts by expanding the Medicare program to include medication changed all of that.
Volcker has died and at the same time, the stock market is making new highs and the unemployment rate is at historical lows WHILE THE DEFICITS ARE EXPLODING. THIS WILL NOT END ON A GOOD NOTE.
Paul Volcker was one of the great American heroes.
27
Tall Paul was fiercely deliberate in maintaining The FED’s independence. This was the era when the ‘surprise effect’ of monetary policy delivered the tough solutions to supply side inflation. Behind a cloud of cigar smoke Paul would wave aside detractors. He would never compromise long term economic goals to accommodate short term market interests or yield to Presidential election year agendas.
As a passionate angler he was decisive and steady, never losing sight of the end objective.
16
Wouldn’t it have been great to see Trump try to bully Volker?
35
The most important relatively unknown person in the lives of currently living Americans. The relative lives of prosperity that Gen-Xers, Millennials, and later is all due to Paul A. Volcker.
It may not have been among the historically noteworthy crises facing the world such as WW II, but the scourge of chronic double-digit inflation in the USA was every bit as dangerous and, worse, seemed to have the tenacity of an incurable cancer. It took Paul Volcker did what needed to be done.
So, every time I hear younger economists hint that letting inflation increase, all I do is shudder in fear as I hear in my mind "Those who fail to learn from history are doomed to repeat it."
Paul A. Volcker should have been awarded the Presidential Medal of Freedom; along with MLK, he was the greatest American from the 2nd half of the 20th Century.
May God have mercy on our souls because he will no longer be around to protect us from ourselves.
40
@VJR
Couldn't disagree more. Volker set the stage for the election of Trump by decimating areas of the country (Michigan, Wisconsin, Pennsylvania) that never recovered, leading to our current situation.
I also remember double-digit inflation, but I was still a kid. By the time my age group entered adult life, finding a job of any kind had become the biggest problem, let alone financing a car or house. No bank will lend to the unemployed.
5
@Les Couldn't agree with you more. Many members of our generation know what it was like to hit the job market during one of the deepest recessions in history.
2
@Les @PM
Don't blame Volcker for that.
The problem of your finding a job had nothing to do with Volcker but with other factors including the destruction of unions, technology, and outsourcing. Believe me: I'm on the receiving end of it too.
2
One of the last true public servants. May he rest in peace.
None of the folks that succeeded him at the Fed. Reserve come even close to what this man achieved for the country. Greenspan, Bernanke, Yellen, and Powell disgust me.
8
Volcker's advice was always sound and his recent biography, Keeping At It: The Quest for Sound Money and Good Government, was probably one of the best reads in the past year.
He was not afraid of anybody, including Reagan who quietly tried to get him to dial back interest rates. Volcker was a rare bird and will be missed.
12
However, the problem with having Volcker in charge of economic policy is the press and the people. They do not either want to sacrifice anything or understand why sacrifice is necessary and will punish any President that puts a Volcker type in charge. Which would lead to a big deficit spender taking over and then things get worse. Reagan was a big deficit spender. So was Bush II. And Trump is on track to trump both.
We are currently spending much much more now to create as much jobs in 2019 as we did in 2016 where the annual deficit was 447b. Today they are over 1b. And Americans are cheering this economy and these policies where he removed the sequester, doubled defense and domestic spending, cut nothing, and bullied the Fed to lower interest rates. What independent Fed? Nothing can be independent from the twitter bully. Not the Fed or the Justice Department.
And the press keeps talking about how the economy is doing great. Yeah if we all doubled our incomes by borrowing more to pay later without acknowledging it and then printed money to add to that we'd all think we were doing great too. Until the chips fall and maybe the near octogenarian the fools put in charge might not even be around to suffer it with us. And even if he were he'd just likely file bankruptcy again. We need an educated populace to allow policies like Volcker's to be sustained long term or we'd punish those who appoint him and reward those who would tear down good policies leading us to worse outcomes.
15
It is evident that Paul Volker was a smoker in 1980. I wonder whether he stopped smoking later or he was not a chain smoker. Living to 92 was probably the most significant accomplishment of his life. I thinking living beyond 90 is a significant achievement but if he was a chain smoker and continued to smoke since this picture, I would say that he could have lived beyond 100, if he had stopped smoking soon after that image of him in 1980. RIP Mr. Volker.
4
@Girish Kotwal "Living to 92 was probably the most significant accomplishment of his life."
You are obviously too young or weren't around when Volcker saved the United States' economy from being permanently crippled by inflation. That was the most significant accomplishment of his life. I don't care if he smoked until the cows came home. If he were still around, I buy him the finest cigar I could afford. Really.
25
Chairman Volker, surrounded by a vaping-like cloud of cigar smoke, is not the optics that the NYT's should be projecting. It sends the wrong impression i.e. that you can smoke cigars, beat the odds and live a long life. Cigar smoking carries many of the same health risks as cigarette smoking and is associated with an early death as well as coronary disease, oral, esophageal, laryngeal, lung, and pancreatic cancers, and aortic aneurysm. It's just not in the interest of the nation's public health to publish pictures of people smoking cigars, cigarettes, and e-cigarettes.
7
@Girish Kotwal He stopped smoking after he left the Fed. When he sat for his formal portrait as a former President of the NY Fed the artist made him, to a bit of resentment, hold a cigar.
1
There was a time in this country when responsible people cared about inflation's deleterious effects on the economy and tried to do something about it.
That time is now long gone, as are the responsible people who cared about this.
14
Volcker's policies helped Wall Street and the banking industry and were a natural precursor to trickle-down Reaganomics. But his policies and his beliefs in the so-called "service economy" also marked the beginning of the end for the middle class and the American dream. He may have helped curb the worries of hyper-inflation (debatable), but he did nothing to stem the corporate greed that led to escalated skewing of wealth to the upper 1%. His policies and pronouncements also assisted the death of homegrown American industry and the exodus to offshore manufacturing.
May he rest in peace.
10
@Tony
::sigh:: The peanut gallery is always wrong.
https://www.federalreservehistory.org/people/paul_a_volcker
A towering and honest guy who will be much missed.
What a contrast between his extraordinary talent, frugality and compromise with public service than most of out current politicians.
19
A truly great FR Chairman. Perhaps he was the greatest. He showed what was possible if a body such as the fed was allowed true independence, and also allowed to take the heat while the medicine ran it's course. He cannot be replaced, and will be missed.
28
Paul Volker was a giant in the banking and finance community to steered this country out of potential disaster with integrity and an ethical compass which we are missing today. You are sorely missed already, Mr. Volker.
20
I doubt that Paul Volcker would have allowed himself to be bullied around like Jerome Powell has been by Trump. I would like to know what Volcker thought about the lowering of the interest rates in the time of economic expansion that the fed just did.
31
My favorite quote after the financial meltdown of 2008: "The most important financial innovation that I have seen the past 20 years is the automatic teller machine."
This remains true to my mind and if only we could limit the burying of systemic risk in things like synthetic CDOs etc.
9
The greatest US public official since George Marshall. I have one of those 2 by 4's in my office--when they were sent to Volcker, staff members were free to drop by his office and pick them up! (what else would they do with them?).
A member of my synagogue was friendly with Volcker in the 1960s, when Volcker was working at Chase and living in Montclair. He told me they spent riotous New Year's Eves playing Gin Rummy--that's the sort of person Volcker was.
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Credit due indeed to Mr. Volker, long one of my heroes.
And credit too, as also noted here, to President Carter, who indeed lost the election as a result.. The Reagan revolution and the Gingrich/Tea Party insurrection may turn out to have been the beginning of the end for American democracy, or at least the American hegemony.
The difference between the Tea Party idealogues and someone of Volker and Carter's integrity is that the latter have the courage of their convictions, try to do as they see right, and are willing to take the blame, just or not, for their actions, and the latter are merely deflecting and arrogant.
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Mark, good comment but you need to edit and change “latter” to “former” in your final sentence.
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@Pat Gentry Pat, thank you! I caught that too, but a little late. I appreciate that you read closely enough to catch and correct the error and also appreciate your kind words.
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The greatest central banker in the history of America. He had the courage to pursue a path that was unpopular because he believed it was the right thing. He was not impressed by financial folly masquerading as innovation. Asked about the greatest financial innovation he had seen in the last 50 years the did not point to exotic mortgages or complex financial instruments. Instead he cited the automated teller machine (ATM).
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My deepest condolences to the Volcker family. My grandfather, Dr. Hobart Carr, was a dear and long-time friend and colleague. They both had similar wit and countenance; a shared deep and abiding need to do the right thing; strength and integrity; and love of cigars. His passing is a tremendous loss to this country.
When my grandfather passed away in 1990, Paul came to visit with us. Perhaps the most memorable sentiment he shared with us was that if it had not been for Hobart, he would have "just been a lawyer." I'd like to think they are sharing a cigar and drumming up the next poker game.
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One thing about Volcker is that he did what he felt was best for the economy, rather than giving in to political pressure from whatever administration he was serving under.
Maybe our current Fed chairman Jerome Powell should take note of this.
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@Francisco Mr. Volker had grit and integrity. Powell, not so much.
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@Edgar Powell is doing his all to restrain Trump.
He was also a very savvy politician. He had to be one in order to maintain support for his program. He cultivated Congressmen and newspaper columnists so their doubts, if any, remained muted. Also, he was generally regarded by those working with him to be the smartest person they ever met. Yet also a great sense of humor. The country is lucky to have had him.
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Mr. Volker did an outstanding job as Fed Chair and adviser in decades after that. Oh and he spoke at my college graduation and that was great! RIP sir.
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“There is no force on earth that can stand up effectively, year after year, against thousands of individuals and hundreds of millions of dollars in the Washington swamp aimed at influencing the legislative and electoral process. Indeed, the growth of money in politics is a major challenge to the democratic ideals we express. We have learned time and time again that years of financial stability and economic growth tend to involve easing of regulations and supervisory discipline. We see that at work as I write in 2018, with pleas for reduced capital standards for banks and a narrowing of the number of mega-financial institutions subject to more intrusive surveillance.” Paul Volcker in his book Keeping at It.
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@Mike
I wish he had been on the Supreme Court when Citizens United was decided. Only SCOTUS is unaware of the corruption money brings to politics. Free speech indeed!
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Thank you for this quotation. I’ll get Mr Volcker’s book!
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@Mike
The taproot problem in America has been the growing number of ignorant voters since the 1960s, aided by the doubling of our population since then.
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To speak truth, unpopular truth, inconvenient truth, to power is the greatest measure of courage. And then to carry the weight of unpopularity without lashing out, just getting on with the task.
Mr. Volcker was indeed a giant among men and a splendid America.
RIP
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It's fate. The country is at the crossroads again.
Short term pain for long-term gain. Who is the champion that will move the nation past it's current problems?
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Volcker's draconian but necessary actions at the Fed that saved our economy cost Jimmy Carter re-election as much as the Iran Hostage Crisis.
The "Reagan Recovery" was no such thing--it was the Volcker Recovery, and Reagan's economic policies nearly sank it, instituting the Laffer Curve of ASSUMING that lower taxes would increase incentives, expand the economy and offset any loss in government revenue. It failed and the deficit exploded, as it is again. It was only Volcker's policies of tight money that saved us. Reagan even had to give in and raise some taxes again. When Volcker left, Alan Greenspan replaced him with a completely different approach and was later responsible in large part for a the collapse at the end of Bush's due to the irresponsible tax cuts he endorsed in 2001 for Bush.
While Obama brought Volcker back as an adviser, he mistakenly made the egotistical Lawrence Summers head of the Council of Economic Advisers who then actively worked to cut Volcker out, though Paul Volcker was probably the greatest economic adviser of the last 70 years.
I have nothing but admiration for the great, brilliant, and totally dedicated Paul Volcker. RIP, Sir!
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@Dadof2 NJ
I think that none of the Secretaries of the Treasury nor the Economic Advisors was ever able to break the influence of John Maynard Keynes on increasing inflation and devaluation of the currency. Keynes's theory proved to be too convenient for all Adminustrations, be they conservative Republicans or leftist radical Democrats.
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@Dadof2
Reagan reappointed Volcker to the Fed and his administration bore the full brunt of the recession in 1982. He then carried 49 states in the 1984 election. Give him some credit.
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@Dadof2 good points. However, the problem with having Volcker in charge of economic policy is the press and the people. They do not either want to sacrifice anything or understand why sacrifice is necessary and will punish any President that puts a Volcker type in charge.
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Paul Walker was a great man of finance. May he Rest In Peace and his legacy live forever.
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@Tuvw Xyz
Paul VOLCKER was a great man of finance.
Paul WALKER was a great man of The Fast and Furious who died accordingly.
I was a college student studying economics when Volker purposely took us into that recession in order to beat inflation into the ground, which he did. That demonstrated the power of the Fed and the man who could stand-up to the blood curdling wails of the country.
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RIP Mr. Volcker...We lost another good one. His principled ways and independent approach is being eroded once again. I suppose we will witness another financial crisis which will be less apparent to the general public soon, where we will continue to create more exotic products by stripping away the rules he helped shape.
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I remember his brutal inflation-fighting medicine of the 1980’s quite well. At the time, he was vilified from all sides but ignored the critics and stayed the course, basically laying the foundation for future central bankers around the world, not just in America.
Tough cat. Condolences to the family.
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A good man and a really good public servant. RIP
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I was a foreign student from Cyprus in Economics & Political Science (BA W\Honors) and International Finance at Stanford when Paul Volcker was the Fed's Chairman during the Reagan Presidencies . I became increasingly enamored by the resilience in his doctrine of how to root out the scourge of the US economy, inflation in ways and with policies that had to be inescapably, painful. Otherwise, American would do it again and learn to live with inflation and expectations running amok.. He taught us a lot and along with my Stanford professors, i.e. William Sharpe, Ronald Mckinon , Mark Mancall and Condi Rice I left the US with a cache full of lessons and knowledge to last two life times.. He was indeed a giant in policy making. May he rest in peace. His Family and country should be proud of and grateful to him. I shall, surely, never forget him and always be thankful to him. George Stavri
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@George Stavri says "Paul Volcker was the Fed's Chairman during the Reagan Presidencies" ignoring the fact that he was appointed Fed chair by Jimmy Carter.
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Mr. Volcker was a gentleman, a brilliant central banker, and a patriot. Condolences to the family. His passing was a great loss to the country. One hopes that leadership of the Fed will be guided by Mr. Volcker's integrity, independence, and judgment. Politicians should strive to do what is needed to help the U.S. regain its stature, standing, and success in the world economy by doing the right thing, as Paul Volcker taught us.
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Good man. Mr. Volcker was tough on us back in the late 70's and early 80's, but we benefit from his actions today, with negligible inflation and low interest rates.
We could use more individuals like him today, they are desperately needed if we are to survive as a Democracy.
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My sincerest and deepest condolences to Mr. Volcker's family upon the death of this great and historic public servant, a "mensch" so terribly missing in today's disgraceful political climate.
My family moved to Teaneck, NJ from the Bronx when I was 10 years old in 1966. I soon learned of the Volcker family's odyssey, also to Teaneck, many years before as Paul Volcker's father was town manager during its years of growth as a bedroom community just over the GW Bridge from NYC. My parents chose to move to Teaneck, similarly to the Volcker's, as Teaneck was a progressive township with a decidedly mixed population of races and creeds.
Paul Volcker's historic and controversial fight against inflation in the late 1970s/early 80s helped set the tone for decades of economic expansion. Yet, he also came to realize that such expansion inevitably led to excess, greed and a risk-taking that would threaten our economy. He famously opined that the most advanced financial change in his recent memory was the ATM machine, not all the financial machinations that proved to be the undoing of our financial health during the 2000s.
And now, alas, the financial "titans" now seek to abrogate the Volcker rule. Mr. Volcker would certainly know such an effort would result once more in speculative excess and its attendant consequences. RIP Mr. Vocker, a true mensch of our times.
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Ronald Reagan got so much credit for the economic expansion that occurred in his first term. PV's fed did the hard work to tame the inflation beast during the Carter administration. Not to take anything away from Reagan but Carter and Volcker never get the credit they deserve. RIP Paul.
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@Mickey Very good observation. And lest we forget, Reagan appointed the greatest weasel of them all, Greenspan.
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@Mickey
Yes, do "take it away" from Reagan. We've been living with Reagan and the republicans ridiculous "trickle down" credit appropriation of an improved economy for these 40 years.
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@Mickey
What do you mean to take anything away from Reagan?
You must know that the entire road to unethical and degraded ruin we are on right now had it's inglorious start with that grinning huckster of hucksters.
Trickle down has destroyed the middle class and a whole lot of physical infrastructure and wealth of this once great country. Like someone opined form another country:
America really had it going on until Reagan, what you had you gave it all up for lower taxes.
Take a good look around at the wreckage of a government.
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