The importance of an independent judiciary in ensuring a stable economy was on display yesterday at the Georgetown University Law Center – by two of America’s foremost public figures.

Former Federal Reserve chairman Alan Greenspan headlined the annual conference of the Sandra Day O’Connor Project on the State of the Judiciary at the Law Center alongside former Supreme Court Justice Sandra Day O’Connor and other top legal minds in the country.

O’Connor opened the conference, entitled Our Courts and Corporate Citizenship, by discussing the importance of continued judicial independence. In particular, O’Connor took aim at the recent influx of partisan involvement in state and local judicial races.

“Justice is a special commodity,” she said. “The more you pay for it, the less it’s worth.”

Noting rampant judicial corruption that she witnessed while growing up in the 1930s and ’40s in Arizona, O’Connor made her case for an independent and unpartisan judicial branch.

“The pendulum swings both ways,” she said. “Once we hang the `For Sale’ sign on the courthouse door, you don’t know who will own it.”

Greenspan, the keynote speaker for the event and Fed chair from 1987 to 2006, echoed O’Connor’s nonpartisan tone throughout his address. He attributed the country’s past century of economic growth in large measure to its impartial rule of law, as guaranteed in the Constitution, paying special attention to the protection of individual and property rights.

“To be sure, people have to, and do survive, in totalitarian, centrally planned societies where individual property rights are de minimis,” he said. “But theirs is a lesser existence.”

In the current financial crisis, Greenspan said, the United States must maintain the existence of a fair rule of law in order to retain the confidence of commercial institutions. Without this, he warned, support for competitive markets and globalization may not last.

Greenspan also credited America’s protection of civil rights as an important part in the nation’s robust economic growth.

“Capitalism under authoritarian rule, on the other hand, is inherently unstable because it forces aggrieved citizens to seek redress outside the law,” Greenspan said.

University President John J. DeGioia introduced Greenspan by noting his history of pragmatism and bipartisanship in his 20 years at the Federal Reserve. Justices David Souter and Stephen Breyer were also slated to speak later in the day.

Greenspan did not hesitate to directly address the current financial crisis as well. Calling the current crisis one that comes along only once in a century, Greenspan acknowledged that the solution to the current crisis would define the world economy for years to come. Despite the challenges, though, Greenspan said that there is still hope on the horizon.

“Eventually, the market freeze will thaw as frightened investors take tentative steps towards reengagement with risk,” he said.

Financial and economic revival should follow soon afterwards, he added.

“I suspect it will be sooner rather than later,” he said. “In either event, human nature being what it is, revival will come. It always has in this society governed by that remarkable document we call the Constitution of the United States.”

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