U.S. Representative Barney Frank, the top Democrat on the House Financial Services Committee, is renewing a push to remove Federal Reserve regional presidents from voting on central bank interest-rate decisions.He's right, of course. The regional Feds are not governmental organizations, they are quite literally owned by the regional banks they nominally regulate, and these people are therefore the employees of the regional banks.
Frank, of Massachusetts, will submit a new version of legislation to cut the voting rights of five rotating regional representatives from the 12-member Federal Open Markets Committee, he said today. The revision of Frank’s May proposal calls for replacing them with four presidential appointees, according to a position paper released by his office.
Eliminating regional presidents, who are selected by board members of their banks and approved by Fed governors, will make interest-rate votes more democratic, Frank said in the paper. The 7-3 vote at the last FOMC meeting in August underlined the need to replace the presidents, who have become a “significant constraint on national economic policy making,” he said.
Regional presidents “are neither elected nor appointed by officials who are themselves elected,” Frank wrote in the paper. “They are part of a self-perpetuating group of private citizens who select each other and who are treated as equals in setting federal monetary policy with officials appointed by the President and confirmed by the Senate.”
Anything that to any degree takes any governmental (or in this quasi-governmental) agency out from under the thumb of the banksters is a good thing.™
*In a 110% purely heterosexual kind of way, of course, as the General would say.
I detest him. He has huge, un-accepted part in this financial crisis. One good deed that will go nowhere does not mitigate.
ReplyDeleteMatthew, connect the dots. The Regional Fed Presidents have been dissenting against Bernanke and more QE. I believe there were 3 dissenters in the recent Fed meeting. Bernanke is trying to get Frank to do his dirty work for him by getting rid of the those who won't follow him down the path to QE3. Frank is in bed with the banks and Bernanke and is more than happy to do Bernanke's bidding.
ReplyDeleteHonestly, I agree with Krugman: QE ain't great, but it's better than doing nothing, which is what Boehner is determined to do.
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