[A frequently spread myth is that Alan Greenspan supports an H-1B increase. Here he states that he has no opinion on the matter.]

TEXT-GREENSPAN Q&A-PART 33 Lending, immigration


07/25/00



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Following is Part 33 of a transcription of the question-and-answer period
for Federal Reserve Chairman Alan Greenspan's semi-annual economic report to
Congress before the U.S. House Banking Committee on Thursday, July 20.
The transcription is provided by Federal Document Clearing Service:



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U.S. REPresentative JAN SCHAKOWSKY, D-IL: Thank you ... How do we maintain
mixed-income communities? How, as we improve our cities and we gentrify our
communities, do we still find a place for those people who can't afford
these $100,000, $200,000 homes? And that it's not sufficient to say this is
just a fact of life, these are the forces out there. ...


GREENSPAN: Just let me -- let me (inaudible). I don't disagree with you, but
I just want to emphasise, let's make sure that when we intervene it works
and not -- I've seen too many activities that we've all engaged in in which
we promise people things, we say we're going to do this and this is going to
happen, and it doesn't happen. And I think the discouragement that...


SCHAKOWSKY: I agree. There are too many examples.


GREENSPAN: The discouragement that happens to a lot of people I think is a
potentially very sad thing that we are often -- too often responsible for.
You know, government basically promises things and we can't deliver and
that's -- and I think that undercuts society.


I don't disagree with your general concern, but I think let's be careful to
be sure we know what we're doing.


SCHAKOWSKY: We should be careful, but I think we cannot afford to give up on
it.


GREENSPAN: I agree with that. I agree with that.


SCHAKOWSKY: There was some discussion about predatory lending ... I know
that in other contexts that -- fair lending and the CRA come to mind -- that
the Fed has opted not to exercise its authority to examine bank
subsidiaries. ... what factors will determine whether the Fed might reverse
its positions and examine subsidiaries for predatory lending.


GREENSPAN: I think that will occur as a consequence of these hearings that
we're engaged in at this stage.


SCHAKOWSKY: And many of the provisions in my bills and others really are
within your purview. You could do it without legislation, it seems to me --
all the things we talk about, the triggers, some of the practices that need
to be prohibited like flipping or lump-sum credit life insurance funding,
appraisal manipulation, et cetera. I think those are things that you could
just do and that would be wonderful.


GREENSPAN: Well, I think that Governor Gramlich, who is in charge of this
project for us, is undergoing fairly extensive examination of various
alternatives which, under existing statute, the Federal Reserve has
authority to act.


SCHAKOWSKY: One last thing. ... Over the years, including -- over the
months, a year ago almost to this day at this hearing, you talked about
immigration and expanding immigration. ... I'm wondering exactly what you're
proposing or what you would think would be appropriate policies.


GREENSPAN: Actually, I'm not proposing anything. And the reason I'm not, is
I think that integration policy is a very crucial, political issue for a
society in which elected representatives make very important judgments. What
I'm trying to do and hopefully trying to stay this side of recommendation,
is merely citing what I think the statistics and the economics were saying,
and not making judgments as to whether H1(b) should be increased --
decreased in a certain manner.


I do recognise that we -- there would be benefits involved in a number of
these different types of activities, but I've tried to stop short of
recommending any specific detailed programme, because I do think that that's
going well beyond, I think, anything that's appropriate for central banks or
anything related to issues which are major value judgments of a society,
which, in my judgment, are wholly within the realm and should stay there of
the elected representatives of the people.


SCHAKOWSKY: OK. Thank you for that.