The Federal Reserve Monopoly Over Money
By Ron Paul
04/10/07 "ICH"
-- - Recently I had the opportunity to question Federal
Reserve Chairman Ben Bernanke when he appeared before the
congressional Joint Economic committee. The topic that morning
was the state of the American economy, and many of my colleagues
raised questions about how the Fed might better "regulate"
things to ease fears of an economic downturn. The tenor of my
colleagues' questions suggested that Mr. Bernanke's job is
nothing less than to run the U.S. economy, like some kind of
Soviet central planner.
Certainly it’s true that Mr. Bernanke can drastically affect the
economy at the drop of a hat, simply by making decisions about
the money supply and interest rates. But why do members of
Congress assume this is good? Why do we accept without objection
that a small group of people on the Federal Reserve Board wields
so much power over our economic well-being? Is centralized,
monopoly control over our money even compatible with a
supposedly free-market economy?
Few Americans give much thought to the Federal Reserve System or
monetary policy in general. But even as they strive to earn a
living, and hopefully save or invest for the future, Congress
and the Federal Reserve Bank are working insidiously against
them. Day by day, every dollar you have is being devalued.
The greatest threat facing America today is not terrorism, or
foreign economic competition, or illegal immigration. The
greatest threat facing America today is the disastrous fiscal
policies of our own government, marked by shameless deficit
spending and Federal Reserve currency devaluation. It is this
one-two punch – Congress spending more than it can tax or
borrow, and the Fed printing money to make up the difference –
that threatens to impoverish us by further destroying the value
of our dollars.
The Fed’s inflationary policies hurt older people the most.
Older people generally rely on fixed incomes from pensions and
Social Security, along with their savings. Inflation destroys
the buying power of their fixed incomes, while low interest
rates reduce any income from savings. So while Fed policies
encourage younger people to overborrow because interest rates
are so low, they also punish thrifty older people who saved for
retirement.
The financial press sometimes criticizes Federal Reserve policy,
but the validity of the fiat system itself is never challenged.
Both political parties want the Fed to print more money, either
to support social spending or military adventurism. Politicians
want the printing presses to run faster and create more credit,
so that the economy will be healed like magic – or so they
believe.
Fiat dollars allow us to live beyond our means, but only for so
long. History shows that when the destruction of monetary value
becomes rampant, nearly everyone suffers and the economic and
political structure becomes unstable. Spendthrift politicians
may love a system that generates more and more money for their
special interest projects, but the rest of us have good reason
to be concerned about our monetary system and the future value
of our dollars.
Dr. Ron Paul is a Republican member of Congress from Texas.
http://www.house.gov/paul/Click here
to comment on this and other articles
Send Page To a Friend
In accordance
with Title 17 U.S.C. Section 107, this material
is distributed without profit to those who have
expressed a prior interest in receiving the
included information for research and educational
purposes. Information Clearing House has no
affiliation whatsoever with the originator of
this article nor is Information ClearingHouse
endorsed or sponsored by the originator.)
|
