Former Federal Reserve chairman Alan Greenspan, in his new book, bashes US President George W. Bush for not responsibly handling US spending and racking up big budget deficits.
A self-described "libertarian Republican," Greenspan takes his own party to task for forsaking conservative principles that favor small government.
"My biggest frustration remained the president's unwillingness to wield his veto against out-of-control spending," Greenspan wrote.
And he weighed in briefly but pointedly on the Iraq war: "I am saddened that it is politically inconvenient to acknowledge what everyone knows: the Iraq war is largely about oil."
Bush took office in 2001, the last time the government produced a budget surplus. Every year after that, the government has been in the red.
In 2004, the deficit swelled to a record US$413 billion.
"The Republicans in Congress lost their way," Greenspan wrote. "They swapped principle for power. They ended up with neither. They deserved to lose."
Last year, voters put Democrats in charge of Congress for the first time in a dozen years.
Greenspan's memoir, The Age of Turbulence: Adventures in a New World, is scheduled for release today.
The book is a recollection of his life and his time as Fed chief.
Greenspan, 81, ran the Fed for 18 and a half years and was the second-longest serving chief. He served under four presidents, starting with his initial nomination by Ronald Reagan.
He says he began to write the book on Feb. 1, last year, the day his successor -- Ben Bernanke -- took over.
The ex-Fed chief writes that he regrets the loss of fiscal discipline under Bush.
"`Deficits don't matter,' to my chagrin, became part of Republicans' rhetoric," he wrote.
Greenspan has long argued that persistent budget deficits pose a danger to the economy over the long run.
At the Fed, he repeatedly urged Congress to put back in place a budget mechanism that requires any new spending increases or tax cuts to be offset by spending reductions or tax increases.
Large projected surpluses were the basis for Bush's US$1.35 trillion, 10-year tax cut approved in the summer of 2001.
Budget experts projected the government would run a whopping US$5.6 trillion worth of surpluses over the subsequent decade after the cuts. Those surpluses, the basis for Bush's campaign promises of a tax cut, never materialized.
"In the revised world of growing deficits, the goals were no longer entirely appropriate," Greenspan said.
"Most troubling to me was the readiness of both Congress and the administration to abandon fiscal discipline," he said.
Greenspan, in testimony before Congress in 2001, gave a major boost to Bush's tax-cut plan, irking Democrats.
He argued then that a tax cut could help the economy deal with sagging growth. The economy slipped into a recession in March 2001.
The Bush White House defended its fiscal policies in light of the Greenspan book.
"Clearly those tax cuts proved to be the right medicine for an ailing economy," White House spokesman Tony Fratto said. "Tax cuts contributed a portion to early deficits, but those tax cuts accelerated growth over time."
"We're not going to apologize for increased spending to protect our national security," he said.
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