Tuesday, May 3, 2011

With Help of Barney Frank, Fed Chairman Bernanke Attempts to Consolidate Even More Power

Whoa, check this out (Pdf).

Congressman Barney Frank has introduced a bill that would eliminate the presidents of the regional Federal Reserve banks from sitting on the Fed's monetary policy committee, the Federal Open Market Committee.

The regional presidents tend to vote in line with the wishes of the Fed chairman, but an occasional lone wolf appears. Last year the lone wolf was Kansas City regional president Tom Hoening. Hoening would consistently vote against increasing the money supply. His lone wolf vote, however, had little impact on policy, since he was always out voted by the remaining money printing advocates.

This token dissent, however, is apparently a bit much for Frank and Fed Chairman Ben Bernanke. The bill introduced by Frank has to be coming at the insistence of Bernanke and would do nothing but further consolidate power in the hands of the Fed chairman, since Fed governors, as opposed to regional Fed presidents, tend to stay in line and vote with the Fed chairman.

Strike another aggressive move by the passive-aggressive Bernanke in attempting to remake the Fed in a manner that other Fed chairman never came close to attempting. Between his new monetary "tools", which can make it more difficult to understand what type monetary policy he is actually conducting, and this Frank bill, Bernanke has to be considered the most obfuscating, power consolidating chairman in the history of the Federal Reserve.

1 comment:

  1. If the Fed governors aren't going to help Bernanke cross the Rubicon, they are of no value.