Senate Confirms Fed's Greenspan To Third Term: 7 Democrats Oppose...
Federal Reserve Chairman Alan Greenspan was confirmed to a third, four-year term yesterday on a Senate vote of 91 to 7, the latter all Democrats complaining that interest rates are too high.</br></br>White House budget director Alice M. Rivlin also was confirmed both to a 14-year term on the FedÛªs board and to a four-year term as vice chairman. However, that vote, 57 to 41, was much closer than anticipated as Sen. Christopher S. Bond (R-Mo.) led a group of Republicans who were unhappy about what they see as RivlinÛªs failure to provide them full details about some future-year spending cuts included in the latest budget submitted by President Clinton.</br></br>Many close observers of the Fed expect no noticeable change in monetary policy as a result of the addition of Rivlin and Meyer, both of whom agreed at their confirmation hearing that the central bankÛªs primary job is to keep inflation under control.-But they both also agreed the Fed should pursue policies that keep unemployment as low as it can be consistent with holding down inflation.</br></br>Sen. Tom Harkin (D-Iowa) had held up consideration of the nominations, which were approved more than two months ago by the Senate Banking Committee, until he and a few colleagues were given parts of three days in which to lay out their case against Greenspan during a discussion on the Senate floor.</br></br>Harkin argued that the Fed under Greenspan has consistently kept interest rates too high to allow the economy to grow as fast as it can without causing inflation to surge.