Former U.S. Fed chair Alan Greenspan dies at 100

Alan Greenspan, who made several visits to China as chairman of the United States Federal Reserve and consistently brought a data-driven perspective to U.S.-China trade relations, died on Monday at the age of 100. 

"Alan passed away at our home this morning at the age of 100 from complications of Parkinson's disease," his wife of 29 years Andrea Mitchell said in a statement.

"He was a giant of a man who helped shape the U.S. economy for decades under presidents of both parties, but was always honest in acknowledging his mistakes," Mitchell said.

Greenspan's nearly 19 years at the helm of the Fed, from 1987 until his retirement at the start of 2006, were marked by a stock market boom and low unemployment.

He presided over a sustained era of U.S. growth and prosperity, yet one that ended with devastating consequences in 2008, two years after he had left the central bank, U.S. media reported on Monday.

Working under four presidents and alongside seven Treasury secretaries, Greenspan was seen as the "maestro" who kept the economy humming, Bloomberg commented.

As Fed chief, Greenspan first visited China in October 1994, during which he noted the progress the country had made in economic development.

"Shifting from a centrally planned economy that has been in place for many years to a market economy is a complex and difficult process, and China has already achieved tremendous results through a variety of workable methods," Greenspan said, according to a transcript of his talks posted on the Brookings Institution's website.

In his subsequent visit to Beijing in 1997, Greenspan talked with Chinese officials on banking and finance, according to Chinese media reports.

Born on March 6, 1926, in the Washington Heights neighborhood of New York, Greenspan showed mathematical acumen from a young age.

He seemed to approach U.S.-China trade relations with a perspective rigorously grounded in mathematics.

Rather than yielding to the sentiment of the moment, he frequently pushed back against politically popular but economically flawed narratives that circulated throughout Washington regarding the complex economic ties between the two countries.

For example, during testimony before the Senate Finance Committee on June 23, 2005, Greenspan systematically dismantled the prevailing argument that forcing China to revalue its currency would bring manufacturing back to the U.S..

"Some observers mistakenly believe that a marked increase in the exchange value of the Chinese renminbi relative to the U.S. dollar would significantly increase manufacturing activity and jobs in the United States," he testified. "I am aware of no credible evidence that supports such a conclusion."

He carried this same pragmatic skepticism into discussions regarding trade barriers, explicitly warning against the illusion of tariffs.

"More generally, any significant elevation of tariffs that substantially reduces our overall imports, by keeping out competitively priced goods, would materially lower our standard of living," he told lawmakers, in remarks that still resonate today as tariffs have been increasingly employed as a tool in trade relations.

"A return to protectionism would threaten the continuation of much of the extraordinary growth in living standards worldwide, but especially in the United States," he added.

Greenspan cautioned lawmakers that punitive trade measures would not achieve the political promise of saving domestic industries, saying that "few, if any, American jobs would be protected".

"A policy to dismantle the global trading system in a misguided effort to protect jobs from competition would redound to the eventual detriment of all U.S. job-seekers, as well as of millions of American consumers."

Even after his retirement, Greenspan continued to comment on the escalating economic tensions between Washington and Beijing.

Responding to a question about China at a New York University event in 2018 during U.S. President Donald Trump's first term, Greenspan said the tariff policies were "insane".

"It's an excise tax, and people think of tariffs other than what it is," he was quoted by U.S. media as saying. "It's a tax, and everybody engaged in warfare of this type, it would mean that you're withdrawing credit or purchasing power from a whole series of countries."