From the excellent Binyamin Applebaum at the NY Times:
One part of the economy that’s growing rapidly is the Federal Reserve.
These are boom times for the central bank, which persuaded Congress to expand its responsibilities significantly in the wake of the financial crisis.
And with greater responsibility comes a larger budget. If not in every case, then at least in the case of the Fed, which as it happens sets its own budget.
The Annual Report: Budget Review published Tuesday shows that the Fed plans to spend $4.7 billion this year, a 35 percent increase over 2006 after adjusting for inflation. Moreover, the Fed’s fee-based income from check processing and other services has been in steep decline, with the result that the net cost of operating the Fed actually has increased by 105 percent.
Millions of seniors, my 90 year old mother included, have had to exhaust their savings simply to subsist, when a normal 4% interest rate would have been enough to supplement her income for years. This lost income is in fact a wealth transfer to the banks.
The boomer children of those made destitute by Bernankenstein’s evil policy are also forced to divert whatever spare income they may have into the unconscionable medical and elder service industries. This is another tax benefiting only privileged few at the top of the medicindustry pyramid.
These policies are an evil disgrace, a blot on humankind. They do not and cannot work. If it were not for the massive capital flight from Europe into the coffers of the US Treasury, where it is spent the next week to fuel current consumption, the US economy would have collapsed years ago. This is a Ponzi game plain and simple. It only works because it is the last game standing. It looks good while it’s running, but one day there won’t be any more suckers.
As for the Fed as a regulator… please. Oh mygawd! How can the Fed regulate its owners, the member stockholders of the district banks who, like the James Demon, sit on the boards of those district banks. The Fed is in bed with these animals. It exists to feed the beast. Congress, on the take, plays along. The public sleeps.
End the regulatory role of the Fed for starters. It’s a sham.
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