Forum Post: The progressive case against the fed.
Posted 13 years ago on Oct. 24, 2011, 1:54 a.m. EST by noalternative
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A real good article Matt Stoller of Rebel Capitalism
...............Structurally, the Fed is a two-part system, with a Board of Governors in DC and Reserve Banks that sit in 12 separate regions of the country that represented roughly equivalent sectors of the economy in 1913. The Board of Governors has 7 members, each of whom can have one 14-year term, and a Chairman who has a four year term. These members are appointed by the President and confirmed by the Senate. Monetary policy is set through the Federal Open Market Committee, which has members from both the board and the Reserve banks. If you ever want to see how the country is actually run, read the transcripts of FOMC meetings, which are released on a five year lag (they used to be shredded as a matter of course). It is stunning to read how Reserve bank presidents basically talk to WalMart and high-end headhunter firms to find out how their regional economy is doing, and then set monetary policy. It’s also crazy that we still do not know what the FOMC was saying from 2005 onward, during the height of the mortgage boom and bust. All of this is secret, and very much open to subpoena for some enterprising politician. (It is one of my great disappointments that neither the Democratic House or Senate tried to get these transcripts, given that we know that Alan Greenspan was muffling dissent on the housing bubble in 2004, the last released transcript.)
The Reserve Banks are quasi-public and quasi-private entities owned by member banks. The New York Fed, for instance, pays dividends to JP Morgan, and has a .org web address. The Reserve banks are governed by Boards of Directors that are drawn mostly from the banking sectors of their regions, as well as large companies and the occasional union leader or university president. The Fed also has a large research staff and funds most macro-economic monetary policy research. It is uncommon to find ‘credible’ economists in monetary policy who have no financial ties to the Federal Reserve banks. The Fed is actually one point of contention between the right-wing billionaire Koch family and the Ron Lawl libertarians; the Kochs are supportive of Federal Reserve-tied scholars, and Paul’s people are not (the Palin Tea Party had no involvement in the Audit the Fed fight, the Ron Lawl Tea Party was the driving force on the right for that legislation).
This structure is the result of a political compromise in its inception, a holdover from the Wall Street-populist fights of the 1890s, the financial panic of 1907, as well as legislative shifts over 90 years. It is a deeply corrupt and indefensible system rife with conflicts of interest. The Reserve banks conduct a good amount of the regulatory work in our banking system. Their boards are staffed with bank leaders, and the presidents of the Reserve banks are actually hired by these bankers. Reserve banks even pay dividends to their bank members (attention Congresscritters who want to find a pay-for!). This ‘I’m a dessert topping and a floor cleaner’ identity allows Reserve banks — particularly the NY Fed — to intimidate courts and aide its allies on Wall Street. Additionally, the Reserve banks aren’t subject to the same government policies regarding Federal wages, so they can pay higher wages and give lucrative and prestigious consulting contracts to economists. In one hearing in the 1960s, a Reserve Ba..........
Dear NoAlt & Allies, The following understatement is a serious error:
"This structure is the result of a political compromise in its inception, a holdover from the Wall Street-populist fights of the 1890s, the financial panic of 1907, as well as legislative shifts over 90 years. It is a deeply corrupt and indefensible system..."
Yes, the Fed is an indefensible system, but not because its structure is a result of mere compromise.
Without reading griffin's monumental history of "The Creature from Jekyll Island" (the Fed), we can See the Fed as a deliberate scheme to bamboozle & defraud We the Sheeple, by letting "interested parties" (AKA the 1%ers pervert & exploit the US economy & human culture, globally).
Fact # 1) the Fed Act strips Congress of its Constitutional duty to regulate our money (our economy), which is totally illegal without a Constitutional amendament.
Fact # 2) any illegal (unconstitutional) law enacted "under the color of law" (in other words, fraudulently imposed as valid law through deception, corruption, etc.) is totally bogus & invalid from the start.
Fact # 3) the Fed is a fraud justified to prevent financial panics (crashes) of the financial system, like the "Panics" of the 1800s & 1907, while, in fact, the Fed has never done that because its whole reason for being is to regulate the cycles of booms & busts for the sake of the big winners, AKA the 1%ers, the Plutocrats (or oiligarchs).
Those are why Fed board meetings are secret & a five year lag of official reports are necessary to its efficient fleecing of the sheeple.
Of course, such rules have nothing to do with either effective government or economical equity (an fair, honest money system). The only purpose the Fed and its rules (its structure) have ever served is defrauding the people of Earth who are not ruled by sociopathic greed and other ecocidal evils.
But please do not eat the rich and ultra-rich, their meat is full of toxins and 1 plutocrat wouldn't make much of a meal for 99 of us anyway.
I don't recommend lynching either. The most effective strategy is rehab & retraining & restitution and/or capital banishment. I mean, clearly, we don't want to let people get away with treason & ecocide, but we need to face the facts. We've all been tainted to some extent, and what's most important is real recovery & remedial rehab of the economy, the culture & the environment.