The Federal Reserve, the least conservative government institution
In a front page article perhaps more conspiratorial and hard to believe than anything Dan Brown has ever written, The Wall Street Journal reports on a secret power shift at the Federal Reserve Bank.
Citing the “Triangle Document,” referencing “a little known committee,” and alluding to the powerful “Risk Secretariat” at the Fed, this tale proves yet again that the actual machinations of the U.S. government can be more bizarre than even bestselling fiction.
When it comes down to it, the power shift at the Fed is a solid reminder of the laundry list of nonsense that Americans put up with while still calling America a free country. It is to the benefit of the entire country that Tea Partyers, conservatives and other freedom-minded folks openly shed light on and oppose such nonsensical tyranny in our government.
{mosads}It’s important to keep in mind what exactly the Federal Reserve Bank does. In addition to various governmental regulatory responsibilities, and a sense of mission creep that has made it into a behemoth difficult to have realistically imagined at the time of its original 1913 legislation, the Fed exists to affect what may be the single most important number in our entire economy — the interest rate. We all know how important money is in the functioning of the world. The interest rate is effectively the price of money.
Instead of our economy being built on free market concepts of minimal government economic intervention, we have the Fed interfering integrally in the entire economy by affecting the interest rate. There’s a consistent reason Karl Marx in The Communist Manifesto calls central banks one of the 10 pillars of a communist economy: Central banks limit individual freedom and put bureaucracies and secret committees in charge of important economic decisions.
Risk secretariats end up having more influence over your ability to sell your house than you do and at what price point, while your spouse gets despondent because you’re going to lose the deposit the two of you just put down on your dream home. Closed-door meetings of so-called public institutions determine what you’re going to pay in credit card interest each month as you and your kids work to get out from under those student loans. Men with secure government jobs tell tens of thousands of risk-taking, consumer-pleasing American entrepreneurs in one fell swoop that their entrepreneurial plans are suddenly no longer tenable because the central bankers decided that they need to solve a complex equation using guess-and-check to see if moving the interest rate north or south will affect the levels of energy stockpiles or grain reserves.
The movements of a free market can be easy to justify. Everyone plays by the same timeless rules of supply and demand. The diktats of a central bank can be hard to justify. The same way any other industry lobby and special interest group have extensive say in U.S. policy, the country’s largest financial institutions run the Fed and seat friends, bank alumni and intellectual supporters on the boards of the central bank. Curiously, this entity is then referred to as “independent.”
Auditing this entity, we are told, will suddenly be the action that causes the banker-filled Fed to no longer be independent. Americans generally just allow this extensive cronyism, because any objection is met with a flurry of confusing-sounding economic data written purely for the purpose of sounding confusing. Control of a central bank was written into The Communist Manifesto because there is no more effective means of controlling the economy than by controlling the interest rate. We are also told how great it is for all Americans, a challenging claim to support, but one that understandably needs to be made authoritatively by any lobby that seeks to continue its influence in a democratic system. Authoritatively sharing a falsehood is also called lying. As un-American as a central bank is, it has served entrenched financial institutions well and politicians are not likely to upset this lobby by taking a sincere look at how America can be better served by removing bank cronyism from our monetary system.
As shown by the consistent failure of communism around the world: Individual consumers are best able to make economic decisions effectively for themselves.
This was demonstrated so effectively by economists such as the 1974 Nobel Prize-winning F.A. Hayek in the Glenn Beck-touted perennial classic and bestseller The Road to Serfdom from 1944 and his teacher and colleague Ludwig Von Mises in the prescient Socialism published in 1922.
Additionally, the most effective method of allocating resources in a society relies on freely fluctuating prices of goods and services, unaffected by government decree. Just like Internet service, health or steel, free-market advocates recognize that the market for money is best able to operate when its price is allowed to fluctuate freely.
This latest bizarre revelation about the Fed and its “little known committee” and “Triangle Document” is troubling, but not surprising. None of this changes the fact that a free country has no use for a Federal Reserve Bank, because a free people do not fear the ups and downs of freedom, and does not need to be coddled by government for comfort.
Allan Stevo is an American conservative writer. Follow him @AllanStevo.