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Why is the Fed Managing the Economy?

By       (Page 1 of 1 pages)   3 comments
Message Mark A. Goldman

Why is the Fed managing the economy?  The Fed is essentially a private organization made up of private banks whose job it is to manage monetary policy.  Monetary policy means managing the supply of money in the economy.  There's only so much the Fed can accomplish by changing the supply of money in the economy.  In addition, the Federal Reserve is really a misnamed organization, given that it is not really an arm of the government, but rather a privately controlled organization.  It seems totally inappropriate that the Fed should be put in charge of solving our country's economic woes, particularly when you consider that it was the Fed's irresponsible gross mismanagement of the banks that crippled the economy in the first place. 

Apparently the Fed is running the show because the banks have become so powerful that the government is forced to abdicate its responsibility for managing the economy in favor of the Fed, while the Fed's primary interest is the health and wealth of the banks and their owners and not the American people.  The Fed has betrayed their fiduciary responsibilities.  Do we even have a government in place that's managing the people's business for the benefit of the people?  It doesn't look like it to me.  Not any place I look.

Our financial problems cannot be solved with monetary policy.  Monetary policy is necessary, but not sufficient.  What is needed is appropriate fiscal policy and with respect to fiscal policy it looks to me like no one is minding the store.  The policies being discussed by members of Congress all seem to be pointing in the wrong direction.  What we need is stimulus, properly allocated and focused; what they're arguing about is how much to cut the budget at the expense of those who can afford it the least.  These people do not understand economics, or more accurately, they don't care about people, and the people who supposedly do understand economics have apparently lost their voice.  If we were responsible about repairing our failing infrastructure, doing something real about global warming, and taking appropriate action on a host of other real problems, our economy would be booming.  Our economy is failing because we are all undereducated, misinformed, and grossly irresponsible.  The main reason our government doesn't work for ordinary citizens anymore is that we choose poorly. 

The president has no clue. He understands economics about as well as he understands the Constitution, which is not at all.  By understand, I mean really understands the purpose and wisdom of what the founders had in mind to the point of dedicating his life to preserving and protecting it.  He doesn't understand it.

The American economy is stagnating and there is no long term vision to the policies being pursued by the president or congress.  The voices of reason are barely heard and the People in general are totally in the dark, given that a proper understanding of economics was totally missing from their high school and college curricula.  Many who did study economics over the last several decades were miseducated.  We apparently don't have an electorate that knows enough about what's important to intelligently choose competent, honorable leaders.  That's not an accident.  Some folks don't want you to understand.  If you did understand, you wouldn't tolerate this.

Our seniors have been cheated by a government that promised them a social security check adjusted for inflation.  The government decided to redefine the meaning of the word inflation by excluding food and energy from the calculation and then basing inflation adjustments on what's left.  Right now food and energy prices account for half of the current level of inflation we're experiencing.  That's how much we are being cheated.  Seniors are falling behind because our government cheats.

When the economy gets in trouble, the first thing that Congress does is cut benefits for the most vulnerable citizens, leaving the wealthiest citizens better off than they were before and the poorest much worse off than they were, exactly opposite to what any honorable authority would do. 

We have millions of homes now empty and many hundreds of thousands of families homeless.  Does this make sense to you?  The banks and financial institutions crashed the economy and now intend to  fraudulently own the homes the homeless once lived in.  Does this make sense to you?  Do you think this was all an accident?  Do you think the Fed simply made an unforeseeable error that just happened to end up with this result?  

Now I'm not saying that the Fed set out to confiscate the homes owned by unsuspecting citizens.  But what I am saying is that it was the Fed's infidelity, incompetence, and irresponsibility that allowed the banks to do whatever they wanted to do, including outright fraud on a gigantic scale that allowed this to happen. And what did our government do in response?  It stole trillions of dollars from us and our children's future to bail out the fraudsters, allowing these criminals to get off scot free while giving even more authority to the Fed to manage the economy.  Where is the outrage? 

There isn't any outrage because citizens were never taught in school how the economy works or how government works.  So now most are easily duped by the garbage they hear on the evening news every day which doles out the propaganda the government and their large corporate owners give them.  They are happy with how it's all working out" which is to say, that poor people are getting poorer while rich folks are getting richer.  Why?  Well, guess which camp the owners and managers of the large corporations fall into. 

These are times where the financial safety net of citizens ought to be strengthened and the wealthiest among us ought to be taking a haircut.  Many families are going hungry as congress is arguing about how much hungrier they should be, than they already are.

Healthcare is an economic issue.  A single payer plan is the only sensible way to save money, improve care, and cover everyone at the same time.  We know that because we can see that it works for every other successful country in the world but ours.  Even our own Medicare system works better than most other government programs. So the only sensible solution we absolutely know works is the one solution that's off the table.  Does that make sense to you?

The Fed ought to be fired from the job of managing the money supply.  It ought to be done by a government agency (the Fed is not a government agency).  If it were handled properly, the interest you pay on your mortgage or car loan would go back into to the nation's treasury instead of into the private hands of bank owners.  After all, the money the bank loans you is money it creates out of nothing (it's not their money they lend, nor anyone else's) and yet they get to charge you interest on it and then confiscate your property if you fail to pay.  It's not their money they lend out, why should they get to keep the interest on it.  Duh.

Education is an economic issue.  If you don't get a good education how can you make sensible decisions when go to the voting booth?  You can't.  Yet in this country the quality of your child's education largely depends on how much your home is worth.  Does that make sense to you?  In America, every child ought to have the same opportunity to develop their talents and abilities as anyone else.  Public education ought to be uniformly good.  It's public education.  Every citizen deserves an equal chance to succeed.  A child's education ought not depend on their parent's income or ethnicity.  Wake up America.

Military spending is an economic issue.  Why do we spend more money than all other countries combined?  We don't have any enemies except the ones we create when we steal their resources, bomb their homes, or poison their men, women, and children with depleted uranium that causes cancer and birth defects.  Our military doesn't protect us; they create enemies so that our military industrial complex can keep their factories humming in response to perpetual war.  It's not the fault of our 18 year old soldiers who haven't the maturity to know what to do or how to defend themselves.  Government lies to our children about why people hate us.  Then they steal our children away to kill and die and it's all because of money and greed.  Most honorable military leaders don't understand how this works.  They just do what they're told to do.  Do we have enemies?  Yes.  But we wouldn't if we were honorable about how we treated people.  Follow the money and it will take you back to the banksters, financiers, and corporate moguls.  Get real.  Grow up.

When you graduated high school or college did someone once tell you to trust yourself and now go out and make the world a better place?  Well, the truth is, when you graduated you probably weren't as smart as they told you you were.  They weren't lying to you.  They were just being nice.  It was a happy day.  They weren't thinking.  Your real education starts when your formal education ends.  Had they been wiser, they would have told you that you weren't smart enough yet to be as arrogant as you probably were or are.  They should have told you, you would be wise to be humble about what you think you know because a lot of it was going to turn out to be a lie. 

And I will tell you, that by now you had better be wise enough to suspect how truly undereducated you really are.   You need to question your own belief systems and where you got them before they ruin your life, and the sooner you start, the better off you will be.
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Mark A. Goldman is an author, financial planner and was a candidate for president of the United States in 2008 and 2012. His new book called "Starting Over" is available for download free as a pdf file at this address: (more...)

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