Greenspan Sworn In as Federal Reserve Chairman

Alan Greenspan was sworn in Tuesday as the new chairman of the Federal Reserve, succeeding Paul A. Volcker, who gained near-legendary status as the man who defeated double-digit inflation.

Greenspan, 61, was praised by President Reagan during the White House ceremony as “an economist’s economist” who had gained wide respect for his accomplishments as chairman of the Council of Economic Advisers under President Gerald R. Ford and on various other government commissions.

Confidence in Greenspan

The President said he was confident that Greenspan, the 13th chairman since the central bank was created in 1913, would succeed at the delicate task of keeping the economic recovery alive while guarding against a resurgence of inflation.

“Today, low inflation and economic growth can and must go hand in hand,” Reagan said.

Greenspan was sworn in by Vice President Bush an East Room filled with members of the President’s Cabinet, past and current members of the Federal Reserve and representatives of American business.

In his remarks, Greenspan said he was only sorry that former Fed Chairman Arthur F. Burns, “my mentor for 35 years,” could not be present for the ceremony. Burns died recently after heart surgery. Greenspan spoke to his widow following the ceremony.

Both Reagan and Greenspan praised Volcker’s accomplishments during his eight years as Fed chairman. Volcker received sustained applause.

Greenspan joked that he wanted to thank in advance all the economic forces which would make his job easy over the next four years, singling out “inflation, which always stays put; the stock market, which is always a bull; the dollar, which is always stable; interest rates, which always stay low, and employment, which stays high.”

Differs With Volcker

In addition to Volcker, other former Fed chairmen present at the ceremony were G. William Miller, who preceded Volcker, and William McChesney Martin, now 80, who served as Fed chairman from 1951 to 1970.

While many believe Greenspan will be as tough an inflation-fighter as Volcker, he is expected to differ sharply with Volcker on the issue of banking deregulation.

During his Senate confirmation hearings, Greenspan indicated that he would be much more willing to reduce or eliminate regulatory restrictions than Volcker, who often clashed with the Administration on this issue.