When Alan Greenspan became chairman of the Federal Reserve Board a year ago, no one expected him to behave like a blindly loyal servant of the Republican Party. But some skeptics feared that his long-standing ties to the G.O.P. would make him loath to hurt Republican chances during a presidential campaign by raising interest rates, even if such a move seemed necessary.
Last week Greenspan proved those critics dead wrong. In an effort to keep inflation at bay, the Fed raised its discount rate from 6% to 6.5%. That bellwether interest rate, which the central bank charges on loans to financial...
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