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The US Senate will soon vote on Federal Reserve Chairman Jerome Powell’s nomination to a second term. One of the senators opposing Powell is Elizabeth Warren. I don’t often agree with Senator Warren, but I do agree with her assessment that Powell is “dangerous.” However, Warren actually doesn’t understand what makes Powell, or any Fed chairman, intrinsically dangerous to liberty and prosperity.

Warren thinks Powell is dangerous because she thinks he will not be supportive enough of imposing her desired new regulations on banks and other financial institutions. Senator Warren, like most progressives, clings to a fantastical notion that regulations benefit workers, consumers, and small businesses. The truth is most regulations benefit large corporations by imposing costs that big businesses can easily absorb, but that their smaller competitors cannot.

Powell is a threat to the American people. Under his tenure, the Fed has kept interest rates at or near zero. The Fed’s balance sheet has grown to over eight trillion dollars. This has caused prices to climb at a rate America has not seen in several decades.

At his nomination hearing before the Senate Banking Committee, Powell reiterated the Fed’s intention to fight inflation by reducing its monthly 120 billion dollars purchase of Treasury and mortgage-backed securities. Powell also stated that the Fed is planning to increase interest rates this year. However, even if the Fed follows through on this, interest rates will remain at historically low levels.

Powell, like Elizabeth Warren and other progressives, dangerously believes that the Fed should go “woke.” However, Powell is still not “woke” enough for progressives who lobbied President Joe Biden to replace Powell with Fed board member Lael Brainard, the biggest supporter of Elizabeth Warren-style regulations on the Fed board. Brainard is more committed than Powell to using monetary and regulatory policies to advance the “woke” agenda. President Biden did end up nominating Brainard to become vice chairman at the Fed.

A Powell-Brainard Fed would likely use “social and climate justice” as a justification for expanding the Fed’s easy money policies. President Biden has recently nominated Sarah Bloom Raskin to the Fed board, who also has advocated for the Fed to use its power to fight climate change.

A central bank committed to the social justice and climate change agendas will inevitably increase the Fed’s “inflation tax.” Contrary to the claims of some progressives, lower-income Americans are primary victims of this hidden and regressive tax.

Powell prefers to push his rather zealous and extremist philosophies behind the scenes. Thus, not surprisingly, he is a leading opponent of Audit the Fed. Powell claims that bringing transparency to the Fed’s conduct of monetary policy would somehow jeopardize the Fed’s independence. Powell’s claim is truly fake news. There is nothing in the Audit the Fed bill giving Congress or the executive branch any new power over monetary policy.

Any group of individuals given the power to manipulate the money supply, and manipulate the interest rates that are the price of money, poses a threat to our liberty and prosperity. The solution is not to replace Powell with a “better” Fed chairman, or to force the Fed to follow a “rule” that still allows it to erode the dollar’s value. The only way to protect the people from dangerous individuals like Jerome Powell, Lael Brainard, and the rest of the Fed board is to audit and then end the Fed.

(Republished from The Ron Paul Institute by permission of author or representative)
 
• Category: Economics • Tags: Federal Reserve 
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  1. Rich says:

    How in Heaven’s name did the Fed become part of “climate change” and “wokeness”? End the Fed now. This is insane.

  2. Anonymous[324] • Disclaimer says:

    “Manipulating the money …” If that isn’t a Jewish thing, then I don’t know what is.

  3. Petermx says:

    I think the US is in big trouble. It needs a conservative economist (like Paul Volcker in the 80’s) who has the will and the support from a president to fight inflation and there is no chance he will get that from President Biden and that means inflation will explode this year or next. The dollar will fall in value against the rest of the world’s currencies and Americans will be poorer. Everything will cost much more. A President Trump might not be better. President Trump was an advocate of extra low interest rates and he didn’t fight inflation either. It does not appear there are people that will deal with the problem. In fact, according to some people the debt is so huge nothing can prevent economic disaster.

    • LOL: RoatanBill
  4. In case Dr. Paul forgot, it was deregulation of the financial sector, championed by the nasty WASP Alan Greenspan that led to the 2001 and 2008 planned wealth transfers, commonly called “market crisis”.

    • Replies: @Rebel Roy
  5. Today’s so called Socialists have never been anywhere near a factory or a farm. They believe that the FED creates “wealth” by creating “dollars”. The FED is an illegal banking cartel that has turned American Capitalism into NeoFeudalism. A result that was baked in the cake since 1913.

  6. Rebel Roy says:
    @Curmudgeon

    WASP?Are you stupid,Greenspan is neither Anglo-Saxon nor Christian nor White.Nasty Jew is the term you should have used Dummkopf.

    • Agree: JR Foley
    • Thanks: Right_On
    • Replies: @Jokem
  7. It no longer matters who they put in charge of the Fed. The Fed is completely without control of the situation. Their machinations are the last ditch effort to kick the can just once more, but there’s no road left. The world is swimming in Dollars and lots of people no longer want to accept Dollars for payment. Although the Fed created the current fiasco, they no longer have any means to effectively try to tame the situation. Printing pieces of paper that claim they are “money” has reached its terminal point.

    This year, the dollar will lose the rest of it’s purchasing power. It will become toilet paper just like the dozens of fiat currencies before it. This should come as a surprise to no one with a functioning mind.

    • Replies: @Ralph B. Seymour
  8. Jokem says:
    @Rebel Roy

    If you mean Alan Greenspan. From what I know He comes from Eastern European stock, which is certainly not Anglo-Saxon, and Jewish, which is certainly not Christian, but Eastern Europeans are Caucasian and therefore White.

  9. Lael Brainard, Sarah Bloom Raskin? Do they just pick names out of the Tel Aviv phonebook when they’re going to appoint new Federal Reserve heads?

  10. Warren got treated terribly by (((Bernie Sanders.)))

    Must’ve been because she used to be a Republican !!!

  11. I CANNOT understand WHY anyone would want to raise interest rates, AT ALL FOR ANY REASON. Why? Raising INTEREST rates LOWERS the price of DEBT, that is BONDS will be cheaper. What happens when BONDS are cheaper, MORE BONDS ARE SOLD. That is raising interest rates DEFINITELY increases DEBT. In the USA, current debt is in excess of 105 TRILLION dollars, or about 450% Debt/GDP ratio. IF YOU WANT TO CONTROL DEBT, Interest rates NEED TO BE LOWER than they are right now, by A LOT Mr. Paul. It’s simple, supply MUST be lowered to lower demand. What causes the money supply to grow, simple US Treasury debt, the more debt we print the more money that goes out. What causes inflation, money supply growth. PERIOD. There is no other cause. Will LOWER interest rates cause an increase in money supply, the story of the EU with negative rates show that they have a SLIGHTLY better handle on inflation than we do. Alas, we can have the best of both worlds. The US can lower interest rates to -3% the current NEUTRAL rate versus money supply growth AND TAX debt to eliminate the individual tax mandate. A tax of 2.1% on debt, raises the cost of money while lower interest rates LOWERS demand and it eliminates the entire income tax on everyone. An additional tax of 1% eliminates the entire state income tax and sales tax mandate, as well. In libertarian-ism you tax bad behavior, as a rule. There is no worse behavior than generating wealth through debt.

    • Replies: @Jokem
    , @RoatanBill
  12. @Jokem

    It is DOCTOR Paul…

    Dr. Paul is not speaking here in his capacity as an obstetrician, though, but is trading on his fame as a congressman, rather. According to rules of etiquette the American Republic has continuously observed since the days of George Washington, “Mr. Paul” would be the correct form of address.

    For what it’s worth.

    • Replies: @Jokem
  13. Jokem says:
    @V. K. Ovelund

    I consider him to be a physician first and a politician second.

    Being a pirate at heart, I do not put much faith in rules of etiquette. ;->

  14. @h74betatester

    Raising INTEREST rates LOWERS the price of DEBT

    Dead wrong, so the rest isn’t worth reading.

    Are you an economist by any chance?

    • LOL: Realist
  15. JR Foley says:

    If USA debt safely expands to 100 Trillion and negative interest rates kick in—-this could be the solution of debt increasing Economic Growth –The FG model —and Gump says it will be great.

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