Four decades at the heart of US power

Alan Greenspan has occupied the commanding heights of the US economy for more than 30 years. He served as chairman of the Council of Economic Advisers under president Gerald Ford between 1974 and 1977. President Ronald Reagan appointed him chairman of the Federal Reserve Board - the US central bank - in 1987, a position he held until he retired in 2006.

A lifelong Republican and a convinced libertarian - he rates his most important intellectual influences as Adam Smith and Ayn Rand - he believes firmly in unfettered competitive markets as a force for good. Yet, he is eclectic in his political friendships. He forged a strong bond with president Bill Clinton. Now, at the age of 81, he is dispensing policy advice to Britain's new prime minister, Gordon Brown.

In his early years, a career in music beckoned. After high school, he studied clarinet and saxophone at the prestigious Julliard School in New York city, played in an ensemble with legendary jazzman Stan Getz and toured the US as a sideman in a big band.

He also did the band's tax returns, a harbinger of things to come. He subsequently completed his education in economics by taking a PhD at New York University.

In his recently-published book The Age of Turbulence, he runs the rule over the US presidents of the past four decades. He singles out Richard Nixon and Bill Clinton as the two most intelligent men to hold the presidency in his time. Nixon, Greenspan says, was bright but unbalanced. At a meeting during the 1968 campaign, Nixon delivered a tirade "so laced with profanity it would make Tony Soprano blush", he recalls. Greenspan determined not to work with him subsequently and professed himself relieved when Nixon resigned as "you didn't know what he might do".

Clinton, on the other hand, was the consummate "retail politician". He was also, in Greenspan's estimation, serious, courageous in battling Congress to cut the budget deficit and possessed of a detailed grasp of how the US economy worked. The US budget was leveraged back into surplus in 1998, where it remained until 2001.

"A consistent, disciplined focus on long-term economic growth became the hallmark of his presidency," Greenspan writes of Clinton. George Bush snr he did not rate highly: "He didn't think of interest rates as being set mainly by market forces; he seemed to believe they were matters of preference. It was not a thoughtful view."

Bush, having reappointed Greenspan as chairman of the Fed, subsequently lost the 1992 presidential election, and blamed Greenspan's interest rate policy for his defeat.

Greenspan has the grace to print Bush's rejoinder, finally delivered in 1998: "I reappointed him; he disappointed me."

Of the current Bush administration, Greenspan simply writes: "Little value was placed on rigorous economic policy debate or on the weighing of long-term consequences."