Photo by Eli Christman courtesy Truthdig.
Central bankers are staring down the reality that they have little if any ammunition left in their monetary policy arsenal should a downturn appear on the horizon. In a recent Truthdig article, PBI Chair Ellen Brown analyzes the ideas these technocrats are now floating, including one to issue an international digital currency to break the power of the US dollar as global reserve currency. Ellen points out:
“Allowing the IMF to issue the global reserve currency outright would give unelected technocrats unprecedented power over nations and their money. The effect would be similar to the surrender by European Union governments of control over their own currencies, making their central banks dependent on the European Central Bank for liquidity, with its disastrous consequences. … Better would be to nationalize the Fed, turning it into a true public utility, mandated to serve the interests of the economy and the voting public.”
Ellen highlights the latest display of a former central banker’s perceived entitled authority over the nation’s elections:
“A media event that provoked even more outrage against central bankers in August was an op-ed in Bloomberg by William Dudley, former president of the New York Federal Reserve and a former partner at Goldman Sachs. Titled “The Fed Shouldn’t Enable Donald Trump,” it concluded:
‘There’s even an argument that the [presidential] election itself falls within the Fed’s purview. After all, Trump’s reelection arguably presents a threat to the U.S. and global economy, to the Fed’s independence and its ability to achieve its employment and inflation objectives. If the goal of monetary policy is to achieve the best long-term economic outcome, then Fed officials should consider how their decisions will affect the political outcome in 2020.’
“The Fed is so independent that, according to former Fed chair Alan Greenspan, it is answerable to no one. A chief argument for retaining the Fed’s independence is that it needs to remain a neutral arbiter, beyond politics and political influence; and Dudley’s op-ed clearly breached that rule. Critics called it an attempt to overthrow a sitting president, a treasonous would-be coup that justified ending the Fed altogether.”