LOS ANGELES - The Bush administration pressured Federal Reserve Board Chairman Alan Greenspan for a commitment to pump up the economy at a time when his reappointment was under consideration, the Los Angeles Times reported Wednesday.
Unnamed senior administration officials were cited as saying the White House's overtures represented an extraordinary effort to exert influence over the nation's independent central bank.
Specific Growth Targets
In a series of private meetings in spring and early summer of 1991, senior administration policy makers urged Mr. Greenspan to agree to alter Fed policy, the newspaper reported.
The policy changes were aimed at reaching specific growth targets during the coming election year, the officials told the newspaper.
With the continuing downturn threatening President Bush's reelection hopes, some administration officials are willing to openly discuss the negotiations in an effort to shift blame to the Fed, the newspaper said.
Mr. Gireenspan, through a spokesman, acknowledged that he met privately with Treasury Secretary Nicholas Brady before his reappointment by President Bush to a second term was announced in July 1991, the Los Angeles Times reported.
The Chairman's Reply
Mr. Greenspan's spokesman said Mr. Brady urged the chairman to reduce interest rates more aggressively to stimulate the stagnant economy but described as "nonsense" the notion that Mr. Greenspan would commit himself to specific growth targets.
But administration sources told the Los Angeles Times that Mr. Brady afterward told President Bush he felt he had received Mr. Greenspan's assurance he would try to stimulate monetary policy to meet an administration target of 3% growth in 1992.
White House spokesman Marlin Fitzwater confirmed that the meetings had been held but that denied Mr. Greenspan had been pressured.