"The future of our country is in jeopardy." It's what every college graduate wants to hear while sitting up on that stage, sweltering in the spring heat with friends and family watching.
Well, maybe not. But it's what Federal Reserve Chairman Arthur Burns warned the Class of 1974 at Illinois College, according to a contemporaneous New York Times article. Burns was worried about the fallout from soaring inflation. His successor, G. William Miller, apparently issued a similar warning to the Class of 1978 at Boston University. Six years later, Paul Volcker told graduates that they would soon be dealing with economic problems firsthand, and that life beyond the "Groves of Academe" could hardly be confused with a bed of roses.
Fed chairs have long been sought out to deliver commencement addresses and haven't always minced words when they've done it. Current Fed Chairman Ben Bernanke is slated to deliver two such speeches this year, first for Bard College at Simon's Rock in Great Barrington, Mass., on Saturday, and then again in June at Princeton's baccalaureate ceremony.
For the economics majors, hearing from a Fed chair must be -- to borrow a phrase from economics professor Daniel Lin -- the quantitative icing on the cake of four years of slogging through data sets. For others, it may be disheartening to hear about the country's economic woes. Past speeches have often focused on monetary policy or the economic outlook. Volcker, for example, defended Fed independence from Congress at American University's 1984 winter commencement (the Fed was highly politicized -- and unpopular -- as Volcker took steps to break the back of that inflation Burns had warned about a decade earlier).
"I'd like to take advantage of your captive presence today, before you scatter into the real world, to reflect a bit on ... the justification for our special role and degree of independence within the government, and on the special responsibilities that independence implies," he said. Three years later, he apparently told Emory University graduates not to blame Japan for the country's trade deficit.
Alan Greenspan, on the other hand, hit on the importance of integrity as he addressed Harvard graduates in 1999, even while acknowledging the risk of sounding "a bit uncool."
Bernanke in past years has described "the essential complementarity of technology and economics in modern economies" (MIT, 2006); energy and productivity (Harvard, 2008); the economics of happiness (University of South Carolina, 2010); and "the inherent unpredictability of our individual lives" (Boston College School of Law, 2009). For the latter, Bernanke recommended that "the business reporters ... go get coffee or something, because I am not going to say anything about the markets or monetary policy."
The subject of Bernanke's speech on Saturday should be of more interest to the business reporters in the audience. His take on "economic prospects for the long run" will be pored over for clues as to how quickly the Fed chief believes the economy will heal, and when the central bank will begin to ease off of the highly accommodative policies it has deployed since the recession.
It's too soon to say for sure whether he'll take a similar tack at his Princeton speech this year, which could well be his last commencement address as Fed chairman (his second term ends in January 2014). Bernanke taught at Princeton -- and ran the economics department -- before being tapped to join the Fed's Board of Governors in 2002, so there's a personal connection he may want to explore. Given the sluggish recovery and dismal prospects for young people, graduates may breathe a sigh of relief if he does.
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