Consider keeping Bernanke, top Romney adviser says … Ben Bernanke received an unlikely defense of his work at the U.S. Federal Reserve by a top Mitt Romney adviser, who said on Tuesday that he should be considered for a third term as chairman. Glenn Hubbard, economic adviser to the Republican presidential candidate, said he would advise a possible President Romney that Bernanke should “get every consideration” to stay on beyond January 2014, when the chairman’s current term expires. The comments may come as a surprise given Romney has said he would not reappoint Bernanke beyond 2014. Further, many top Republicans have blasted the Fed’s aggressive policies since the Great Recession as overreaching and reckless. – Reuters
Dominant Social Theme: The Fed has abused the trust of US citizens and is not a dependable institution … Wait! Fed chairman Ben Bernanke has been doing a great job and ought to be re-elected.
Free-Market Analysis: The best metaphor we can come up with for Mitt Romney is that he reminds us of Linda Blair in the “Exorcist” movie. Remember that scene when her head rotates all the way round like it’s not attached to anything?
Well, that’s Romney. With almost any issue he seems able to rotate his head around until he’s seen it from all 360 degrees – and made solemn pronouncements about it, often diametrically opposed. In this, ironically enough, he is kind of the anti-Ron Paul.
Ron Paul, of course, is the libertarian-conservative presidential candidate and Republican Congressman from Texas who is famous for never compromising.
As a firm believer in the free market and competitive money, Ron Paul has been a critic of central banking for most if not all of his adult life. For decades as an increasingly successful politician, he was one of a very few who consistently espoused abolishing the US Federal Reserve.
In the past five years, however, Ron Paul’s stubborn, free-market sentiments have finally penetrated the national consciousness and resulted in a bill passed by the US House of Representatives to “audit” the Fed – to find out exactly what it’s been doing with its awesome money power.
Out of the pressure that Ron Paul placed on the Fed in the past years have come two stunning revelations. The first was that the Fed lent some US$16 TRILLION to financial facilities around the world when the global financial crisis was at its height. The second was that top Fed officials directed at last US$4 trillion to financial firms with which they were personally affiliated.
There are numerous justifications for central banking but in reality it is nothing but crony capitalism disguised as a public good.
It has become fashionable of late to say that the Fed is a private institution but it is, of course, a public franchise in terms of largest parameters. It has been cleverly structured to give the appearance (and some of the reality) of extensive public consultation.
In fact, the Fed’s founders spent an inordinate amount of time crafting a bill to legalize its clearinghouse activities within the walls of Congress.
The Fed was authorized in 1913 and by 1920 it was a de facto criminal body, surreptitiously issuing far more dollars than it was allowed to by law, based on the gold it held. The result was the Roaring ’20s and then the Depression of the 1930s. In between were bank holidays proclaimed by President Franklin Roosevelt.
Roosevelt was apparently told to declare bank holidays so people wouldn’t cash in dollars and find out there was no gold. If they had done so the Fed bankers of the day would have been found out.
Instead, the system continued and expanded around the world. Today there are 150 central banks, most reporting to the BIS. In aggregate, the banks seem to belong to a dynastic power elite that uses the Money Power it derives from them to create ever-closer world government.