Tuesday, June 14, 2005

When Alan Greenspan and I studied economics together

I first took notice of Alan Greenspan, the longtime chairman of the Federal Reserve System, in the fall of 1946. We were both undergraduate students at New York University's School of Commerce, Accounts & Finance. (The school is now known simply as the Stern School of Business, thanks to the beneficence of Leonard N. Stern, a billionaire alumnus who made his fortune in the Hertz pet supply and real estate businesses.)
Greenspan and I were both enrolled in the same economics class taught by Dr. Jules Backman, who was then a nationally renowned economist. When Backman was not in the classroom, he was a consultant to major corporations and trade associations and was often testifying on their behalf before Congressional committees in Washington. Among his clients were the Association of American Railroads and the Iron & Steel Institute.
The major economic issue of the day was whether to retain or remove price controls. The controls had been clamped on all businesses during World War II, largely to prevent war profiteering. Although the war had ended two years earlier, the Truman Administration had retained them as a means of smoothing the nation's transition to a peacetime economy. Backman argued that price controls were hampering postwar economic growth and should be removed immediately.
Backman was a very talented lecturer. I remember him as the only college economics professor who could animate what was to me a dreary academic discipline. He enjoyed provoking student debate in his classroom, and a favorite issue was price controls. Most of the students in the class were World War II veterans. We favored the retention of price controls. Having been absent from the work force, we worried that we would be unable to afford what would inevitably be spiraling prices for most goods and services.
Virtually all the other students in the class had been too young to be drafted for military service and had enrolled in college after high school graduation. Greenspan was one of the non-veterans in Backman's class. But before entering NYU as an economics major, he had spent more than a year studying at the Juilliard School of Music and touring with one of the popular big dance bands as a clarinet and saxophone player.
In the classroom debate over price controls, Greenspan was the only student who spoke up to support the professor's argument that controls be dropped. I can still recall that he made his argument with exceptional passion. To me the economics course was simply an academic requirement. But it was already obvious that economics had replaced music as Greenspan's primary passion. Within a few years after we both had graduated in the class of June 1948, he had established himself as a prominent economic consultant on Wall Street. He later became chairman of the President's Council of Economic Advisers during Richard Nixon's second term and in 1987 was named head of the Federal Reserve.
I never developed a passion for economics, and perhaps that's why I never saw Alan Greenspan again.

9 Comments:

Anonymous Anonymous said...

I had Backman in the 1951 at the then school of Commerce. He was an arrogant, pompous ass, who bored the class. To bad the fellow you wrote of “died” somewhere in his glorious past. As for Mr. Greenspan, he may have “controlled” inflation, but at what a terrible to the little guy. So many time he could have raise margin rates or requirements to cool things down. It’s a pity he was in power so long.

Friday, April 07, 2006 1:56:00 PM  
Blogger Raphie Frank said...

My name is Stephen Raphael Frank (aka "Raphie Frank"). I am Jules Backman's grandson (the son of his daughter Susan Patricia) and would be more than grateful to anyone who could provide me with 1st hand information or anecdotes related to my Grandfather.

No worries with respect to any who thought him "an arrogant pompous ass" or worse. I would love to hear from you too, and naturally, would have far more respect for any with negative memories or opinions to share in tandem with the courage to show him or herself in front, not behind, latticed, misty veils of anonymity.

So... to the previous commenter "Anonymous"?

With all due respect for your age, sir, my grandfather likely would not have wasted the time of day on such as you; and insofar as that is the case your recollections with respect to your personal dealings with him are likely accurate. He did not suffer fools well...

On a practical note: Jules Backman won the Great Teacher Award from NYU, not once, but twice. As such, I suggest it was your mind, not the class, that was "bored." Either that, or perhaps his mind was elsewhere and he was having an off-year. Perhaps he was thinking of his wife, Grace, and his 1st born son, John who was either about to be born or just born back then in 1951.

I would not know, of course, as I do not know if you had him for spring or fall semester...

Kindest Regards,
Raphie Fank
917-202-2610

Thursday, July 06, 2006 4:14:00 AM  
Blogger Raphie Frank said...

Actually. come to think of it. my Uncle may have been born in 1949? The general point remains. People are people.

As for Alan Greenspan, he will likely go down in history as the best Fed Chairman ever, although I agree with "Anonymous" that Greenspan could have more actively intervened in Keynsian manner to cool down the expansion of the Internet-fueled dot com bubble.

Raising margin rates or requirements, I suspect, would not have been a poor course of action, but hindsight, of course, is always 20/20.

Kindest Regards,
Raphie Frank

P.S. Anonymous, did you perchance lose money in the crash of 2000? If, so, a pity, since obviously YOU, of all people knew better!

Thursday, July 06, 2006 4:30:00 AM  
Blogger Raphie Frank said...

Dear Mortart,

I have no way to email you directly, so I will take advantage of the comments section on your blog to communicate with you. Indeed, Jules Backman was my grandfather and today, in Jerusalem, my sister was married!

Last year, here in NYC, she expressed a desire to write about our grandfather and asked me for advice re: Interviewing people.

If you would be so kind, I would much appreciate it if you could contact me, so that I can put you in touch with my sister, Elizabeth Grace Backman-Frank

My contact information is available at:
http://raphie.wordpress.com

Just click on the "Contact" link on the right hand side.

Kindest Regards,
Raphie Frank
917-202-2610

P.S. You may publish this comment or consider this personal correspondence. Either way is fine.

P.P.S. It turns out my uncle (John) was born June 25th, 1946, so quite possibly he was particularly animated when you were his student!

Friday, July 07, 2006 11:51:00 PM  
Blogger Shelby said...

Anonymous--

This is Shelby Alexandra Backman, the youngest granddaughter of Jules Backman, that "arrogant, pompous ass" you spoke of.
I’m impressed that you would go so ballsy as to describe him as an ass. But of course, would you have been able to do so if you hadn’t gone under the pseudonym of “Anonymous”? For some unexplainable reason, I think not.
In fact, I would hypothesize that if someone asked you today, right now, to your face, what you thought of my grandfather, you wouldn’t dare bad-mouth my grandfather or his lectures. No, not without the safety blanket of anonymity which this blog provides for such a coward as yourself.

Congratulations anonymous:
You set out to insult my grandfather and came back with so much more: You proved yourself to be a sniveling coward who has no voice nor opinion when you have no mask to hide behind.

Wednesday, October 24, 2007 8:15:00 PM  
Anonymous Anonymous said...

Shelby, you've got to give people a WAY OUT. But I am proud as heck of you for standing up to be heard. Well done!

Love,
Raphie

P.S. I just posted as "Anonymous." Reconcile that one...

Saturday, October 27, 2007 2:42:00 AM  
Anonymous Anonymous said...

Dear Shelby,

I hope this bit of information on your grandfather is of some value to you. I attended NYU from 1952-56and had the great pleasure of studying under both Jules Backman and Alan Greenspan.
Jules Backman was simply the best professor I ever had. That includes Marcus Nadler, Jules Bogen, and Greenspan, and Gitlow. That period was like the N Y Yankees with Di Maggio, Henrick, Keller and Dickey. It was world class.
I went on to become CEO of both a steel company and cement company in the Fortune 500. (No big deal)
My interest in steel stemmed directly from your charming, handsome, and really brilliant gradfather. When President put on price controls (bad move) I was able to make the keynote speech on behalf of the Portland Cement Association to have the cement industry removed from price controls. We were the first industry to be released from that onerous problem. The only reason that we were successful was because my entire speech was written and prepared along with all the charts and diagrams by Jules Backman.
He also had an iconoclastic side. He would point down at his very expensive shoes and state that the were really much cheaper than cheap shoes because they lasted so much longer. I also remember his coming to school and being driven in a big Cadillac limousine, courtesy of U S Steel. You should be so proud of your granddad he shined wherever he went, like a diamond in a pail of rhinestones.
Sincerely
Jerome Castle
JCastle01@aol.com

Friday, March 06, 2009 8:43:00 PM  
Blogger R. Kaplan said...

I have an anecdote, and also happen to be a relative. My mother was Hilda Irene Rice, who in 1945 became Hilda Kaplan. Dr. Backman's wife Grace was a cousin from her mother's line. (That's how I found this, searching for clues.)

Upon arrival in class, Dr. Backman informed my mother that hard as she would work, she would earn no more than a C. That's what she got. No hard feelings because they remained in touch until Dr. Backman'd death in 1982. I have about 6 small pocket calendars from my grandfather, Philip Rice. The Backman's are in all of them. Their phone number began SE3...

Sunday, March 15, 2009 9:20:00 PM  
Blogger Art Shatz said...

I had the great pleasure of studying with Dr. Backman in the late 60's. He was fabulous. One of the members of Congress he would constantly pick on was Wright Patman who he would continuously refer to as "Wrong" Patman because his financial positions were so wrong headed.

Tuesday, May 25, 2010 8:30:00 PM  

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