EagleTribune.com, North Andover, MA

October 3, 2012

No one talks about the shadow fourth branch of government


The Eagle-Tribune

---- — To the editor:

“The Board of Governors of the Federal Reserve System and the Federal Open Market Committee shall maintain long run growth of the monetary and credit aggregates commensurate with the economy’s long run potential to increase production, so as to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates.”

That excerpt is from Section 2A of the Federal Reserve Act, and in just over a month when we hold our elections for political office, none of the candidates, including those for president, has mentioned anything about the Federal Reserve (The Fed). The Fed is private bank whose shareholders consist of “Too Big To Fail” banks that funnel millions of money through powerful lobbyists to essentially own members of Congress and the president of the United States. Why haven’t any of the candidates addressed an institution that controls monetary policy of the United States?

One of the goals stated in the Act is for “maximum employment.” Does anyone believe we have maximum employment now? According to the Bureau of Labor Statistics, the “Employment Rate of The Population” has been in steady decline for over a decade. Meanwhile, politicians focus on the “unemployment rate as a percent,” which is not reflective of the true condition of our economy as the BLS does not count a portion of the population not working. It appears rhetoric is a controlling factor, while The Fed continues to violate one of their own mandates, making the condition worse with its now “open-ended” Quantitative Easing (QE) and Zero Interest Rate Policy (ZIRP) further destroying our currency.

Speaking of currency, the Fed is also violating its own act with “stable prices.” According to St. Louis Federal Reserve data, the cost-of-living index, which does not include food and energy (gas), has steadily risen for over 30 years. Were one to include food and energy, we would see an exponential percent increase in our cost of living. A parallel data point is the Consumer Purchasing Power of the Consumer Dollar which has decreased during the same 30-year increase of the CPI. It is essentially an unseen tax upon all Americans, which of course having questioned politicians, none wants to answer. When politicians claim they will lower taxes for you, they are in essence lying to you.

Chairman Bernanke has served during both Bush and Obama years, and both presidents, as well as Congress, have allowed the Fed’s policies of monetary destruction continue. In fact, they have enabled this destruction by not having any repercussions for violating the Federal Reserve Act. Monetizing our own debt does, and will continue to have serious consequences on the future of this country. Eventually the Fed bill will come due, now standing at just under $3 trillion of bad debt, and like all bills, the consequences will be devastating for Americans already fiscally tapped out. Why candidates and the press refuse, evade, or are not pressed on this issue eludes me. Is it denial? Hubris? Ignorance? Or are they simply in on the sad joke on uninformed Americans playing itself out?

Most of us will get by a few more years of this disastrous Fed policy, but after that, good luck to us all.

Duncan Burns

Bradford