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Greenspan agreed to become chairman of the President's Council of Economic Advisers in July 1974, just a month before Nixon resigned. President Ford supported his predecessor's choice, and Greenspan took over in September. He would become one of Ford's closest advisers and a golfing partner as well.
During his tenure in the Ford White House, Greenspan recognized the perils of inflation but nonetheless had to defend an especially lame program to combat price hikes: the "Whip Inflation Now" campaign concocted by Ford. The President's calls for Americans to conserve energy and shop wisely -- and wear WIN buttons -- had little impact. The subject of inflation also inspired one of the most embarrassing gaffes of Greenspan's career. Speaking at a Government hearing in 1974, he declared, "Everyone was hurt by inflation. If you want to examine percentagewise who was hurt most . . . it was Wall Street brokers." Following a public outcry, Greenspan backed off. "Obviously the poor are suffering more," he said.
Even after Greenspan left the White House in 1977, he was regularly drawn back to politics. In 1979 Edward Kennedy consulted Greenspan for advice about making a bid for the presidency. During the 1980 Republican Convention, Greenspan played an important role in the behind-the-scenes jockeying to name Ford as a vice presidential candidate on the Reagan ticket.
Four and a half years ago, as chairman of Reagan's bipartisan National Commission on Social Security Reform, Greenspan displayed his knack for forging compromise on the most sensitive of political issues. The group was charged with the critical job of recommending steps to save the Social Security system from insolvency. After 13 months the panel proposed raising + the payroll tax, extending Social Security coverage and delaying cost of living increases for retired workers -- all controversial measures that would be largely adopted by Congress.
While Greenspan's consulting firm has continued to thrive despite the owner's periodic political forays, at least one of his business ventures has turned sour. In 1984 Greenspan joined two partners in opening a money- management firm called Greenspan O'Neil Associates. The company, with $3 million in backing from Talent Agent Marvin Josephson, hoped to manage pension-fund accounts. But Greenspan O'Neil never attracted enough clients, and early this year the firm closed.
Despite his hectic schedule, Greenspan occasionally finds a few hours for tennis at the Century Country Club in Purchase, N.Y. Music remains a passion. These days he listens most often to the baroque composers Handel and Vivaldi and occasionally plays the clarinet. Another favorite pastime, the economist has said, is staying in his five-room Manhattan apartment, "nibbling on things from the fridge and reading a thriller." One favorite author: Eric Ambler.
Greenspan will soon need such diversions more than ever. Of all the wrenching transitions in his eventful career, none rivals the challenge he is about to take up.