The Sane Case for Auditing the Fed. What is it about the Fed that inspires such solidarity among its critics? Ever since its creation during the Woodrow Wilson era, it’s been a favorite target of everyone from right-wing conspiracists who fear the Fed is simply another cog in an international Jewish banking conspiracy to left-wing populists who see it as both a cause and effect of globalized capital. Because it controls the money supply of the planet’s biggest economy and because it operates so opaquely, it’s an obvious place to project all sorts of anxieties about large, impersonal forces beyond our reach that sharply affect, if not actually control, virtually all aspects of our daily lives.
But one needn’t wade into the fever swamps of conspiracy to see the Fed as an inherently problematic institution. The central bank is explicitly tasked with the fundamentally incompatible duties of conducting stable monetary policy, promoting full employment, acting as a lender of last resort, and regulating the banks it works with. Good luck with all that. Also, while it’s technically independent, the federal government exerts massive political pressure on the Fed and appoints its chair and board of governors.
Reid hasn’t explained exactly why he won’t allow a vote on the bill, which has 30 co-sponsors. He’s keeping his reasons secret, which means that the Fed’s secrets are safe for at least a little while longer. And that trust in government will keep shrinking, just like the value of a dollar has over the life of the Federal Reserve. [The Daily Beast]
That drop in the value of the dollar is the main reason the Federal Reserve exists–it’s the organization responsible for looting the savings of people who use dollars though inflation. The government naturally wants to hide that. Consider the link at the end of the quoted section of the article: it shows an “inflation calculator” which, by default, shows that an item bought for $20 in 1913 would cost $480.51 in 2014. However, it uses the US government’s “Consumer Price Index,” a statistic specifically intended to hide the real rate of inflation.
Fortunately, it’s easy to find out how much $20 in 1913 is really worth today. In 1913, a US $20 coin had .9675 troy ounces of gold. That’s worth $1,147.07 today–which means that the US government, through the Federal Reserve, has stolen well over twice the amount that they’re willing to admit to through inflation. It’s hardly surprising they don’t want too much scrutiny.