For Greenspan, 1996 Is Just Around The Corner

Even hard-core political junkies aren't focusing on the 1996 Presidential race yet. But it's not too early for Federal Reserve Chairman Alan Greenspan to start thinking about an event that will coincide with the next New Hampshire primary. Sources say the 67-year-old Greenspan has hinted to the White House that he hopes to be reappointed when his term ends in March, 1996.

It might seem that the very Republican Fed chairman doesn't have a chance. But Greenspan has aggressively--and effectively--courted the Clintonites. "He proactively maintains friendly relations with people all over this place," says one senior Administration figure. He breakfasts regularly with Treasury Secretary Lloyd M. Bentsen and chats often by phone with economic adviser Laura D'Andrea Tyson, among others. White House officials say Clinton likes Greenspan and is happy with his handling of monetary policy so far--not surprising given the sharp drop in long-term interest rates.

Still, Greenspan is no shoo-in for a third four-year term. His best-case scenario: Three years of growth cause price pressures to build. Clinton might then feel he must name a certified inflation-fighter. Ironically, the more successful the Fed is at beating inflation, the worse Greenspan's chances may be.