The Region

Biographical Dictionary of the Board of Governors of the Federal Reserve

Book Review

Published June 1, 1992  | June 1992 issue

Edited by Bernard S. Katz
408 pages

In the preface to this collection of Fed biographies, the editor Bernard S. Katz, a professor of economics at Lafayette College in Pennsylvania, tells of a local event featuring former Federal Reserve Board chairman Paul Volcker. During the ceremony, protesters accused the Fed of holding secretive meetings and fomenting economic ills. It was those protests that led Katz to conceive of the idea of a biographical dictionary of Fed governors.

"Despite their important decision-making roles, the personal profiles of these men and women who control the national money supply have been cloaked in shadow," Katz writes. It is his intention, with the publication of this dictionary, to lift the veil of that shadow and provide a more balanced view of every governor who has served the Fed, from 1913 through January 1991.

To those who believe that the creation of monetary policy—arguably an endeavor that combines "art" and "science"—is more dependent on art, these biographies may be illuminating. But even those who adhere strictly to the numbers and take a more rigid view of policymaking should find these brief bios of interest.

Written by academics from across the country, these entries provide information on the backgrounds, training, politics and wisdom of the lives of the men and women on the Board of Governors, according to Katz.

Following is a sampling from the entries of some current and recent governors:

Alan Greenspan
(1988-current chairman)
"Greenspan's association with [Ayn] Rand welded his thoughts on the linkage between efficiency (of capitalism) and morality. In early issues of the Objectivist, a Randian periodical, Greenspan's writing championed capitalism and scored the inequities and inefficiency of the welfare state."

Wayne D. Angell
"Angell's bold proposals for reducing payment system risk are reflective of an open and creative mind and symptomatic of his willingness to discuss virtually any issue.... Angell accepted the nomination to become a member of the Board of Governors only after receiving private assurances from the Reagan administration that he would not be muzzled with respect to his views on economic and monetary policy."

Edward W. Kelley Jr.
"... Kelley knows there is no substitute for first-hand information. 'We [board members] talk around the country to gather as much anecdotal evidence as we can, and just plain old sit quietly, looking out the window and thinking about it,' he reports. Such 'plain old sitting and thinking' served him well in business and provides the insight of an experienced practitioner to the discussions at the Fed."

John P. LaWare
"As a banker, LaWare favored an approach that would place all companies that were financial in nature on an equal footing. ... LaWare's contention was that removing artificial restrictions would allow companies that are essentially financial in nature to merge and efficiently provide a full range of financial services."

Manuel H. Johnson
"With reference to the multifaceted and seemingly intractable international debt crisis, he encouraged the industrial nations to pursue pro-growth policies and to maintain open markets for the exports of the developing world."

Martha R. Seger
"Seger 's penchant for independence is the watermark of her career. At a regular meeting of the Federal Reserve board on February 24, 1986, Seger engaged in a shootout with Fed chairman Paul Volcker that shocked the investment community. Along with vice-chairman Preston Martin (also a Reagan appointee), Seger forced a formal vote to lower the discount rate.... Volcker, who had never lost a monetary policy vote, was absolutely opposed to such a cut. When the dust settled, Seger, with the support of the newest Federal Reserve board members Wayne Angell and Manuel Johnson, had won. Volcker was furious ..."