Allan Meltzer
Encyclopedia
Allan H. Meltzer is an American
economist
and professor of Political Economy at Carnegie Mellon University's Tepper School of Business
in Pittsburgh, Pennsylvania
. He was born February 6, 1928, in Boston, Massachusetts. He is the author of dozens of academic papers and books on monetary policy and the Federal Reserve Bank
, and is considered one of the world's foremost experts on the development and applications of monetary policy.
Meltzer's study A History of the Federal Reserve is considered the most comprehensive history of the central bank. Volume II, which covers the years since the Federal Reserve accord in 1951 to 1969, was released in February, 2010.
Meltzer is considered to have originated the aphorism, "Capitalism without failure is like religion without sin. It doesn't work."
and M.A.
degrees from Duke University
in 1948 and 1955, respectively. He earned his Ph.D.
degree from UCLA in 1958.
Dr. Meltzer served, from 1973 to 1999, as the Chair of the Shadow Open Market Committee
, a group of economists, academics, and bankers that met to critique the actions of the Federal Reserve's Federal Open Market Committee
. He served on the Council of Economic Advisors for both Presidents Kennedy and Reagan. He is currently a visiting scholar at the American Enterprise Institute
.
Dr. Meltzer was the Chairman of the International Financial Institution Advisory Commission
, known as the Meltzer Commission. The Commission's majority report proposed changes to the operations of the International Monetary Fund and especially to those of the World Bank, which the majority recommended should withdraw from lending to "middle income countries". Four (out of 5) Commission members nominated by the then-minority Congressional Democrats filed a dissent from the majority's recommendations (Bergsten, Huber, Levinson and Torres), though one of the four (Huber) both voted for the majority report and joined the dissent. The official vote tally in favor was thus recorded as 8 to 3. Controversy over the majority's arguments and recommendations continued after the report's publication: the majority's core recommendations are defended by Chairman Meltzer's chief advisor Adam Lerrick, and challenged by one of the Commission's critics (David de Ferranti), in their respective chapters in an edited volume published by the Center for Global Development and fully accessible on the web http://www.cgdev.org/content/publications/detail/9957.
Dr. Meltzer was the first ever recipient of the AEI's Irving Kristol
award in 2003. Dr. Meltzer was honored at the award dinner by President George W. Bush
, who remarked "I know I'm not the featured speaker; I'm just a warm-up act for Allan Meltzer."
Dr. Meltzer was highly critical of the Federal Reserve's September 2008 decision to rescue the leading bond-insurer AIG: "these disasters should be headed off early, or should be left to the marketplace to settle." Consistent with this position, the Fed's decision not to rescue Lehman Brothers was one which, at the time, Dr. Meltzer appeared to applaud. Contrasting it with the AIG rescue, he commented: "I would say we ought to look at Lehman Brothers. They let Lehman Brothers fail. Within a few days, just a few days, Barclays was there buying up some of Lehman's assets..." A year later, however, Dr. Meltzer took a more critical view of the Fed's handling of the Lehman case: "After 30 years of bailing out almost all large financial firms, the Fed made the horrendous mistake of changing its policy in the midst of a recession... Allowing Lehman to fail without warning is one of the worst blunders in Federal Reserve history..."
Dr. Meltzer has opposed US adoption of a "cap and trade" scheme for carbon emissions, designed to help combat global climate change.
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
economist
Economist
An economist is a professional in the social science discipline of economics. The individual may also study, develop, and apply theories and concepts from economics and write about economic policy...
and professor of Political Economy at Carnegie Mellon University's Tepper School of Business
Tepper School of Business
The Tepper School of Business is a private business school located on Carnegie Mellon University’s campus in Pittsburgh, Pennsylvania, USA.The school consistently ranks highly among the top business schools in the U.S., as well as in a wide range of specializations, such as finance,...
in Pittsburgh, Pennsylvania
Pennsylvania
The Commonwealth of Pennsylvania is a U.S. state that is located in the Northeastern and Mid-Atlantic regions of the United States. The state borders Delaware and Maryland to the south, West Virginia to the southwest, Ohio to the west, New York and Ontario, Canada, to the north, and New Jersey to...
. He was born February 6, 1928, in Boston, Massachusetts. He is the author of dozens of academic papers and books on monetary policy and the Federal Reserve Bank
Federal Reserve Bank
The twelve Federal Reserve Banks form a major part of the Federal Reserve System, the central banking system of the United States. The twelve federal reserve banks together divide the nation into twelve Federal Reserve Districts, the twelve banking districts created by the Federal Reserve Act of...
, and is considered one of the world's foremost experts on the development and applications of monetary policy.
Meltzer's study A History of the Federal Reserve is considered the most comprehensive history of the central bank. Volume II, which covers the years since the Federal Reserve accord in 1951 to 1969, was released in February, 2010.
Meltzer is considered to have originated the aphorism, "Capitalism without failure is like religion without sin. It doesn't work."
Career
Allan Meltzer received his A.B.Bachelor of Arts
A Bachelor of Arts , from the Latin artium baccalaureus, is a bachelor's degree awarded for an undergraduate course or program in either the liberal arts, the sciences, or both...
and M.A.
Master of Arts (postgraduate)
A Master of Arts from the Latin Magister Artium, is a type of Master's degree awarded by universities in many countries. The M.A. is usually contrasted with the M.S. or M.Sc. degrees...
degrees from Duke University
Duke University
Duke University is a private research university located in Durham, North Carolina, United States. Founded by Methodists and Quakers in the present day town of Trinity in 1838, the school moved to Durham in 1892. In 1924, tobacco industrialist James B...
in 1948 and 1955, respectively. He earned his Ph.D.
Ph.D.
A Ph.D. is a Doctor of Philosophy, an academic degree.Ph.D. may also refer to:* Ph.D. , a 1980s British group*Piled Higher and Deeper, a web comic strip*PhD: Phantasy Degree, a Korean comic series* PhD Docbook renderer, an XML renderer...
degree from UCLA in 1958.
Dr. Meltzer served, from 1973 to 1999, as the Chair of the Shadow Open Market Committee
Shadow Open Market Committee
The Shadow Open Market Committee is an independent, monetarist economic analysis committee founded in 1973 by Profs. Karl Brunner, from the University of Rochester, and Allan Meltzer, from Carnegie Mellon University, named after the Federal Open Market Committee , of which it is often critical...
, a group of economists, academics, and bankers that met to critique the actions of the Federal Reserve's Federal Open Market Committee
Federal Open Market Committee
The Federal Open Market Committee , a committee within the Federal Reserve System, is charged under United States law with overseeing the nation's open market operations . It is the Federal Reserve committee that makes key decisions about interest rates and the growth of the United States money...
. He served on the Council of Economic Advisors for both Presidents Kennedy and Reagan. He is currently a visiting scholar at the American Enterprise Institute
American Enterprise Institute
The American Enterprise Institute for Public Policy Research is a conservative think tank founded in 1943. Its stated mission is "to defend the principles and improve the institutions of American freedom and democratic capitalism—limited government, private enterprise, individual liberty and...
.
Dr. Meltzer was the Chairman of the International Financial Institution Advisory Commission
International Financial Institution Advisory Commission
The International Financial Institution Advisory Commission, also known as the Meltzer Commission — named for its chair, Professor Allan Meltzer — was established by the United States Congress in November 1998 "to recommend future US policy toward several multilateral institutions: the IMF, the...
, known as the Meltzer Commission. The Commission's majority report proposed changes to the operations of the International Monetary Fund and especially to those of the World Bank, which the majority recommended should withdraw from lending to "middle income countries". Four (out of 5) Commission members nominated by the then-minority Congressional Democrats filed a dissent from the majority's recommendations (Bergsten, Huber, Levinson and Torres), though one of the four (Huber) both voted for the majority report and joined the dissent. The official vote tally in favor was thus recorded as 8 to 3. Controversy over the majority's arguments and recommendations continued after the report's publication: the majority's core recommendations are defended by Chairman Meltzer's chief advisor Adam Lerrick, and challenged by one of the Commission's critics (David de Ferranti), in their respective chapters in an edited volume published by the Center for Global Development and fully accessible on the web http://www.cgdev.org/content/publications/detail/9957.
Dr. Meltzer was the first ever recipient of the AEI's Irving Kristol
Irving Kristol
Irving Kristol was an American columnist, journalist, and writer who was dubbed the "godfather of neoconservatism"...
award in 2003. Dr. Meltzer was honored at the award dinner by President George W. Bush
George W. Bush
George Walker Bush is an American politician who served as the 43rd President of the United States, from 2001 to 2009. Before that, he was the 46th Governor of Texas, having served from 1995 to 2000....
, who remarked "I know I'm not the featured speaker; I'm just a warm-up act for Allan Meltzer."
Dr. Meltzer was highly critical of the Federal Reserve's September 2008 decision to rescue the leading bond-insurer AIG: "these disasters should be headed off early, or should be left to the marketplace to settle." Consistent with this position, the Fed's decision not to rescue Lehman Brothers was one which, at the time, Dr. Meltzer appeared to applaud. Contrasting it with the AIG rescue, he commented: "I would say we ought to look at Lehman Brothers. They let Lehman Brothers fail. Within a few days, just a few days, Barclays was there buying up some of Lehman's assets..." A year later, however, Dr. Meltzer took a more critical view of the Fed's handling of the Lehman case: "After 30 years of bailing out almost all large financial firms, the Fed made the horrendous mistake of changing its policy in the midst of a recession... Allowing Lehman to fail without warning is one of the worst blunders in Federal Reserve history..."
Dr. Meltzer has opposed US adoption of a "cap and trade" scheme for carbon emissions, designed to help combat global climate change.
Publications
- Major works before 1997, including his work with Swiss economist Karl Brunner.
- Karl Brunner and Allan H. Meltzer (1993). Money and the Economy: Issues in Monetary Analysis, Cambridge. Description and chapter previews, p p. ix-x.
- Allan H. Meltzer (1999). "What's Wrong with the IMF? What Would Be Better?," The Independent Review. Cached copy.
- _____ (2001). A History of the Federal Reserve, Volume 1: 1913-1951, ISBN 978-0-226-52000-1 Description.
- _____ (2003). "What Future for the IMF and the World Bank?," Quarterly International Economics Report, July Cached copy.
- _____ (2006)."An Appreciation: Milton Friedman, 1912-2006," On the Issues, AEI Online.
- _____ (2009) A History of the Federal Reserve, Volume 2, Book 1, 1951-1969, ISBN 978-0-226-52001-8
- _____ (2009) A History of the Federal Reserve, Volume 2, Book 2, 1970-1985, ISBN 978-0-226-51994-4
- Allan H. Meltzer and Scott F. Richard (1981). "A Rational Theory of the Size of Government," Journal of Political Ecoomy, 89(5), pp. 914–927. Abstract.
External links
- Allan Meltzer's home page at Carnegie-Mellon
- Research of Allan Meltzer compiled at Carnegie-Mellon
- Dr. Meltzer's homepage at the American Enterprise Institute
- Article on monetarism by Dr. Meltzer from the Concise Encyclopedia of Economics
- Interview with Dr. Meltzer from the Minnesota Fed's webpage
- Press release from Carnegie-Mellon on Dr. Meltzer's speech upon receipt of the Irving Kristol award
- Text of Dr. Meltzer's acceptance speech for the Irving Kristol award
- Transcript of Dr. Meltzer's appearance on PBS's Think Tank program
- Source documents for Dr. Meltzer's A History of the Federal Reserve, Vol. I from the FRASER historical documents site of the Federal Reserve Bank of St. Louis
- interview on National Public Radio's broadcast of September 26. 2008.