Edward Gramlich, 68; former Federal Reserve governor

Times Staff Writer

For a policy analyst, which he remained until the very end, it couldn’t have been a much better finale.

Edward M. Gramlich published “Subprime Mortgages: America’s Latest Boom and Bust” in June. Although he was too sick to participate in much of the public debate that surrounded this summer’s subprime-driven credit crisis, his 108-page monograph became a bible for reporters and policymakers trying to figure out what had gone wrong.

Federal Reserve Chairman Ben S. Bernanke ended his first major speech on the subject last week by thanking Gramlich, who was universally known as Ned, for this work. Gramlich told a New York Times reporter that he took some solace from the fact that “I really feel I got it right at the end.”


Ned Gramlich died Wednesday morning of leukemia at a hospice in Washington, D.C. He was 68.

Gramlich applied his analytic and organizational powers to many aspects of American society. He spent almost eight years as a governor of the Federal Reserve, the nation’s central bank, where he chaired both Neighborhood Works, a partnership that generated more than $8.5 billion to help low-income families buy and improve homes or secure decent rental housing, and the Airline Transportation Stabilization Board, set up in the wake of the 9/11 terror attacks to administer a $10-billion federal loan-guarantee program.

“He asked the right questions,” said Robert D. Reischauer, president of the Urban Institute think tank, where Gramlich spent his last two years. “And he always asked how the solutions would affect the economy and people, especially the most vulnerable.”

At the University of Michigan, Gramlich was an economics professor, chairman of the economics department, dean of public policy and provost. Among other things, he taught benefit-cost analysis and, after deciding that he wasn’t satisfied with any of the existing textbooks on the subject, wrote his own, “A Guide to Benefit-Cost Analysis,” now in its second edition.

From 1994 to 1996, he chaired the Quadrennial Advisory Council on Social Security. In 1986 and 1987, he was the deputy director and acting director of the Congressional Budget Office. At various times, he was a senior fellow at the Urban Institute and Brookings Institution, both in Washington, director of policy research at the Office of Economic Opportunity and a staffer at the Fed.

In 1992, after a bitter strike, he was named staff director for Major League Baseball’s Economic Study Commission. Team owners had hoped to prove that large-market teams had an advantage over small-market ones so they could demand that players accept a salary cap in order to even things up. Gramlich concluded the opposite, that small-market teams do not suffer any great disadvantage. But he presented his finding in a fashion that left both sides no more at odds than when the dispute began.


Besides being an analytic challenge, working on the commission was a labor of love for Gramlich, according to his longtime Michigan colleague Paul Courant. Gramlich had been a bat boy for the Rochester, N.Y., Red Wings, his hometown team and a farm club for the St. Louis Cardinals. He was a lifelong Cardinals fan.

Born in Rochester in 1939, Gramlich earned a bachelor’s degree from Williams College in Massachusetts and master’s and doctoral degrees from Yale.

“The unifying theme of Ned’s work is public policy, rather than any single field or small subset of fields,” Courant said. “He belongs to any Who’s Who among applied economists of the last 40 years. But more important,” his professional history reads “like a What’s What of the important public policy problems that we faced in those years.”

Gramlich is survived by his wife, Ruth; daughter Sarah; son Robert; six grandchildren; his parents; two brothers; and a sister.