Paul Volcker

Infobox_President | name =Paul Volcker
nationality =American


imagesize =200px
order =12th Chairman of the Federal Reserve
term_start =August 6, 1979
term_end =August 11, 1987
president =Jimmy Carter
Ronald Reagan
predecessor =G. William Miller
successor =Alan Greenspan
birth_date =Birth date and age|1927|9|5|mf=y
birth_place =Cape May, New Jersey
death_date =
death_place =
alma_mater =Princeton University
Harvard University
London School of Economics
profession =Economist| Paul Adolph Volcker (born September 5, 1927 in Cape May, New Jersey), is an American economist. He is best known as Chairman of the Federal Reserve ("The Fed") under United States Presidents Jimmy Carter and Ronald Reagan (from August 1979 to August 1987). He is today an economic advisor to Democratic presidential candidate Barack Obama. [Kudlow, Lawrence, June 27, 2008. http://www.townhall.com/Columnists/LawrenceKudlow/2008/06/27/wheres_bernankes_inner_volcker?page=full&comments=true]

Education

Volcker grew up in Teaneck, New Jersey, where he graduated from Teaneck High School, and his father was the township's first Municipal manager. [Treaster, Joseph B. [http://books.google.com/books?id=NvpUBgfZur4C&pg=PA100&lpg=PA100&dq=%22paul+volcker%22+%22teaneck+high+school%22&source=web&ots=mIOlHtXAf9&sig=P_QAkxnXbKRtmfJ_4X-MTO41Pek "Paul Volcker: The Making of a Financial Legend"] , Accessed July 6, 2007. "Donald W. Maloney, another Teaneck High School graduate, entered Princeton along with Volcker. Although they had been in the same homeroom at Teaneck High for several years and had been high achievers, they had not been especially close."] Volcker's undergraduate education was at Princeton University; he graduated in 1949. He earned his M.A. in political economy from Harvard University in 1951 and then attended the London School of Economics from 1951 to 1952 as a Rotary Foundation Ambassadorial Fellow.

He has received honorary degrees from several educational institutions including: University of Notre Dame, Princeton University, Dartmouth College, New York University, Fairleigh Dickinson University, Bryant College, Adelphi University, Lamar University, Bates College (1989), Fairfield University (1994), Northwestern University (2004), Rensselaer Polytechnic Institute (2005), Brown University (2006), and Georgetown University (2007).Fact|date=September 2008

Career

In 1952 he joined the staff of the Federal Reserve Bank of New York as a full-time economist. He left that position in 1957 to become a financial economist with the Chase Manhattan Bank. In 1962 he joined the U.S. Treasury Department as director of financial analysis, and in 1963 he became deputy under-secretary for monetary affairs. He returned to Chase Manhattan Bank as vice president and director of planning in 1965.

From 1969 to 1974 Mr. Volcker served as under-secretary of the Treasury for international monetary affairs. He played an important role in the decisions surrounding the U.S. decision to suspend gold convertibility in 1971, which resulted in the collapse of the Bretton Woods system. In general he acted as a moderating influence on policy, advocating the pursuit of an international solution to monetary problems. After leaving the U.S. Treasury, he became president of the Federal Reserve Bank of New York from 1975 to 1979, leaving to take up the chairmanship of the Federal Reserve in August 1979.

Chairman of the Federal Reserve

Paul Volcker, a Democrat [ [http://query.nytimes.com/gst/fullpage.html?res=9B0DEEDA1339F930A35755C0A961948260 The main philosophical difference between Mr. Volcker, a Democrat, and Mr. Greenspan, a Republican, appears to be in their views of the structure and regulation of the banking system.] ] , was appointed Chairman of the Federal Reserve in August 1979 by President Jimmy Carter and reappointed in 1983 by President Ronald Reagan. [ [http://www.cfr.org/bios/451/paul_a_volcker.html Paul A. Volcker - Council on Foreign Relations ] ] Volcker's Fed is widely credited with ending the United States' stagflation crisis of the 1970s by limiting the growth of the money supply, abandoning the previous policy of targeting interest rates. Inflation, which peaked at 13.5% in 1981, was successfully lowered to 3.2% by 1983. [http://minneapolisfed.org/Research/data/us/calc/hist1913.cfm]

However, the change in policy contributed to the significant recession the U.S. economy experienced in the early 1980s, which included the highest unemployment levels since the Great Depression, and Volcker's Fed also elicited the strongest political attacks and most wide-spread protests in the history of the Federal Reserve (unlike any protests experienced since 1922), due to the effects of the high interest rates on the construction and farming sectors, culminating in indebted farmers driving their tractors onto C Street NW and blockading the Eccles Building. [Shull, Bernard. 2005. "The Fourth Branch: The Federal Reserve's Unlikely Rise To Power And Influence". Praeger/Greenwood. ISBN 1567206247. p. 142.]

Post-Fed

In 1975 he had become a senior fellow in the Woodrow Wilson School of Public and International Affairs at Princeton University. After leaving the Federal Reserve in 1987, he became chairman of the prominent New York investment banking firm, J. Rothschild, Wolfensohn & Co., a corporate advisory and investment firm in New York, run by James D. Wolfensohn, who was later to become president of the World Bank.

He was appointed as a member of the Hong Kong Chief Executive's Council of International Advisers in the years of 1998-2005. [http://www.info.gov.hk/gia/general/200311/06/1106201.htm]

In April 2004, the United Nations assigned Volcker to research possible corruption in the Iraqi Oil for Food program. In the report summarising its research, Volcker criticized Kojo Annan, son of UN Secretary-General Kofi Annan, and the Swiss company Cotecna Inspection SA, Kojo's employer, for trying to conceal their relationship. He concluded in his March 2005 report that "there is no evidence that the selection of Cotecna in 1998 was subject to improper influence of the Secretary General in the bidding or selection process". [Independent Inquiry Committee into the United Nations Oil-for-Food Programme - [http://www.iic-offp.org/documents/InterimReportMar2005.pdf Second Interim Report (29 March 2005)] p.77] However, while Volcker did not implicate the Secretary General in the selection process, he did cast serious doubt on Kofi Annan, whose "management performance...fell short of the standards that the United Nations Organization should strive to maintain." [Traub, James. 2006. "The Best Intentions: Kofi Annan and the UN in the Era of American Power". Picardor/New York. p. 420.] Volcker was a director of the United Nations Association of the United States of America between 2000 and 2004, prior to his being appointed to the Independent Inquiry by Kofi Annan.

As of October 2006, he is the current Chairman of the Board of Trustees of the influential Washington-based financial advisory body, the Group of Thirty, and is a member of the Trilateral Commission. He has had a long association with the Rockefeller family, not only with his positions at Chase Bank and the Trilateral Commission, but also through membership of the Trust Committee of Rockefeller Group, Inc. (RGI), which he joined in 1987. That entity managed, at one time, the Rockefeller Center on behalf of the numerous members of the Rockefeller clan. He currently serves as Chairman of the Board of Trustees of the International House in Manhattan, NY. He was a founding member of the Trilateral Commission.

On April 8, 2008, he was the featured speaker at "The Economic Club of New York" and spoke about the issues and causes of the 2008 US recession, and critiqued the 2008 US financial system and the 2008 Federal Reserve policies. [ The Economic Club of New York: 8 April 2008 Transcript [http://econclubny.org/files/Transcript_Volcker_April_2008.pdf#PDF 101st Year, 395th Meeting, (8 April 2008)] p.2, and pp.5-8]

Personal life

Volcker married Barbara Bahnson, the daughter of a physician, on September 11, 1954. She died on June 14, 1998, having suffered from lifelong diabetes, as well as rheumatoid arthritis. They had two children, Janice, a nurse and a Georgetown University graduate, [cite news | title = Janice Volcker Is Married| work = The New York Times| publisher = The New York Times Company| date = 1981-09-20| url = http://query.nytimes.com/gst/fullpage.html?res=9E03E1D61739F933A1575AC0A967948260| accessdate = 2008-07-18] and James, a research assistant and a New York University graduate [cite news | title = WEDDINGS; Martha DeJong and James Volcker| work = The New York Times| publisher = The New York Times Company| date = 1993-08-01| url = http://query.nytimes.com/gst/fullpage.html?res=9F0CE1D81F31F932A3575BC0A965958260| accessdate = 2008-07-18] who was born with cerebral palsy, as well as four grandchildren.cite book| last = Treaster| first = Joseph B.| title = Paul Volcker: The Making of a Financial Legend| publisher = John Wiley and Sons| date = 2004-04-27| location = New York| pages = 83, 110| url = http://books.google.com/books?id=NvpUBgfZur4C| isbn = 0471428124] [cite news | title = Paid Notice: Deaths|VOLCKER, BARBARA | work = The New York Times| publisher = The New York Times Company| date = 1998-06-16| url = http://query.nytimes.com/gst/fullpage.html?res=9807E7DD153DF935A25755C0A96E958260| accessdate = 2008-03-26] cite web| title = Speakers Platform Speakers Bureau: Paul Volcker, Keynote Speaker On: Economics, Global Affairs, Finance / Tax| publisher = Speakers Platform| url = http://www.speaking.com/speakers/paulvolcker.html| accessdate = 2008-03-25]

Volcker is an avid fly-fisherman, having recounted, " [t] he greatest strategic error of my adult life was to take my wife to Maine on our honeymoon on a fly-fishing trip." [cite news| last = Lyons| first = Nick| title = GONE OFF FLY-FISHING| work = The New York Times| publisher = The New York Times Company| date = 1987-05-03| url = http://query.nytimes.com/gst/fullpage.html?res=9B0DE4D9103FF930A35756C0A961948260&sec=&spon=&pagewanted=all| accessdate = 2008-03-25] cite news | last = Russell| first = George| title = The New Mr. Dollar| work = Time Magazine| page = 4| publisher = Time Inc.| date = 1987-06-15| url = http://www.time.com/time/magazine/article/0,9171,964650-4,00.html| accessdate = 2008-03-19] Volcker is also known for his impressive height of convert|6|ft|7|in|m,cite news| last = Cuff| first = Daniel F.| title = BUSINESS PEOPLE; Of Volcker's Laundry And Fiscal Restraint | work = The New York Times| publisher = The New York Times Company| date = 1987-09-03| url = http://query.nytimes.com/gst/fullpage.html?res=9B0DEFDB163AF930A3575AC0A961948260| accessdate = 2008-03-25] standing exactly a foot taller than his wife when they first met.

In January 2008, Volcker endorsed Democratic Presidential Candidate Barack Obama for President. [cite news | last = Calmes| first = Jackie| title = Volcker Joins List of Obama Backers| work = Washington Wire| publisher = The Wall Street Journal| date = 2008-01-31| url = http://blogs.wsj.com/washwire/2008/01/31/volcker-joins-list-of-obama-backers/| accessdate = 2008-07-18]

References

Further reading

*"Paul Volcker: The Making of a Financial Legend", Joseph B. Treaster, New York: Wiley, 2004.

External links

* [http://www.ny.frb.org/aboutthefed/PVolckerbio.html Official Bio]
* [http://www.iic-offp.org The Independent Inquiry Committee into The United Nations' Oil-for-Food Program]
* [http://www.heritage.org/Research/InternationalOrganizations/wm729.cfm Time for Paul Vocker to Resign from the Oil-for-Food Program] A critical article on the Heritage Foundation Website.
* [http://www.depauw.edu/news/index.asp?id=12977 Ubben Lecture at DePauw University]