Volcker has a reputation for fairness and strong leadership during troubled times. When he became chairman of the Federal Reserve in 1979, he faced the worst inflationary crisis America had seen in decades. He ended it by raising interest rates sharply, sparking the deepest downturn since the Great Depression. The interest rate hikes are now widely viewed as a necessary step to end the cycle of soaring prices and stagflation that set in, but at the time the tactic was deeply controversial, as the unemployment rate climbed above 10 percent.
Since being replaced by Alan Greenspan in 1987, Volcker has become an eminence grise, lending independent credibility to a range of organizations. For example, he investigated alleged corruption in the United Nations Oil for Food Program in Iraq. He is also chairman of the Group of 30, an assemblage of leading financial experts that seeks an overhaul of global financial regulations.more » « less