While Ron Paul made the Federal Reserve System a topic of conversation during the 2008 presidential cycle, there has not been much talk of the Fed in either the Democrats' or Republicans' debates. At one Democratic debate the subject came up and the candidate I'm supporting, Bernie Sanders, said that he supports auditing the Fed. He has also supported Senator Rand Paul's bills to audit the Fed in the past. He should say more about his ideas for the Fed. The Fed controls inflation -- a massive transfer of wealth from the poor and middle class to the wealthy. If Senator Sanders wants to fight against a system rigged against the little guy, he would be wise to spend some time thinking about ending the Fed.
It is no secret among my friends that when I was a performer I performed several times for Occupy Miami. People went to Occupy for their own reasons individually I found -- one of the movement's biggest strengths and weaknesses. I did not agree with everything I heard espoused at Occupy rallies, but one idea that I deeply believe in I heard kicked around many times: it is time to end the Federal Reserve System.
Woodrow Wilson signed the Federal Reserve Act in 1913 creating the Federal Reserve System. Many people say he would go on to regret his decision to do so because of the power it gave to bankers. Historically many U.S. presidents were against the idea of a strong central bank. Thomas Jefferson said in 1802:
If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their Fathers conquered.... I believe that banking institutions are more dangerous to our liberties than standing armies.... The issuing power should be taken from the banks and restored to the people, to whom it properly belongs
My favorite president, John F. Kennedy, tried to launch a metals backed currency in the U.S. to compete with the Fed's dollars with Executive Order 11110. Our money is fiat money. It only has value through backing by the full faith and credit of the United States. Kennedy sought to base our currency on silver, where the valuation of the dollar would be based on market fluctuations rather than the whims of the central bank.
Because the Fed controls the value of the dollar, investment in the United States is viewed as a more risky proposition than if the dollar were backed by metal. We have a floating dollar where the value of an investment may decrease over time due to a decrease in the value of the dollar. A more stable dollar leads to a more predictable outcome. More predictable outcomes lead to more investment flowing into the U.S.
The Fed also makes trillions of dollars in loans to Wall Street, which keeps Wall Street in power as an overwhelming economic force. Wall Street's business model depends on the Fed loaning them money at an extremely low interest rate (often zero!) to stay in business. If Wall Street, a very powerful player in American life, needs this type of corporate welfare to stay afloat, perhaps they should try a better business.
I have heard Bernie Sanders speak eloquently and passionately about fixing our economy, regulating Wall Street and creating a more fair system for the middle and lower class. I have not heard a lot from him about a sure way to bring balance back to America -- ending the Fed. While it is not likely that he will adopt that position during the campaign, I hope he will in the future consider taking strong action against central banking. No friend of the big banks, surely this is an idea right up Sanders' alley.