In a piece by David Leonardt at the New York Times, he tries to defend the Fed and its recent grab at more regulatory powers. However, the evidence he provides is more damning than anything.
The article starts with, “If only we’d had more power, we could have kept the financial crisis from getting so bad.” Well, the Fed does control the money supply and is the “lender of last resort.” I’ll let that speak for itself.
Another quote damns central planning:
When Mr. Bernanke is challenged about the Fed’s performance, he often points out that recognizing a bubble is hard. “It is extraordinarily difficult,” he said during his Senate confirmation hearing last month, “to know in real time if an asset price is appropriate or not.”
This is one of the most concise arguments against the Fed I have ever seen and it was uttered out of the mouth of the Chief Thief himself. A group of elite, pipe smoking, tweed wearing economists, no matter “how good they are,” cannot determine if a price is right or not. It takes the market to determine that. Only after millions of individuals make billions of transactions free of regulation and law will a price be made “right.” This is the problem with price setting and a centrally planned economy: a group of twenty cannot determine the economic fate of 300 million.
Mr. Leonardt again attacks what he is trying to defend when he writes,
He and his colleagues fell victim to the same weakness that bedeviled the engineers of the Challenger space shuttle, the planners of the Vietnam and Iraq Wars, and the airline pilots who have made tragic cockpit errors. They didn’t adequately question their own assumptions. It’s an entirely human mistake.
So we’re leaving the fate of our economy within the hands of a few rather than to all the individuals who partake… That’s a great policy to pursue.
Always in need of self-aggrandizement, Ben Bernanke said, “The Federal Reserve has unparalleled expertise.” I also know of another thing they have an unparalleled amount of: arrogance.
Let’s end the Fed.Published in