ViciousVi said:
sc94597 said:
The argument that ending the federal reserve will come naturally from auditing them requires the assumption that what we will see from these audits is sufficient reason to enact legislative action that will end it. I don't think there is any realistic belief that the FED could be burdened enough by the audits that it can't keep up with its role in fiscal policy. Nevertheless, an audit of the Fed during financial crisis only is worthless, because that gives the Fed plenty of time to cover its tracks before any crisis comes to be. Bernie knew this in the beginning and that is why he wished for a full audit. Then his policy changed.
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This statement is simply incorrect and reveals that you do not understand the history of how central banking has been conducted. It is very easy to demonize the actions of a central bank on any given action because the majority of the populace does not understand monetary macroeconomic theory. The very reason we have a public -private hybrid institution is so that we can have a central bank that acts in the interest of the people without being burdened by the scrutiny of laymen whose opinions can be swayed by emotional rhetoric over subjects they do not understand (i.e. politicalization). The average person really does not understand how the economy works. For example, surveys show that consumers typically overstate inflation by 1-2% whereas surveys of professional forecasters usually lineup with public information regarding the rate of inflation. Expertise in this area matters and we want a central bank that is both independent from the public yet beholden to their interests. If you don't like the governing philosophy of those in charge at any given time (like say, Bernanke) then you should put fault on the public actors who empowered them (Bush first, Obama later) and not on the institution they lead. People like Ben Bernanke are largely academics who are simply doing what they believe is best for the economy. Economists come in all stripes, just like Judges, and there is great value in maintaining a separation of powers (independent central banks hold down inflation better, for example). With that said, I think it's obvious that Sanders wanted to look into the actions surrounding a particular policy undertaken during the crisis. You still haven't really proven that to be hypocritical, in the video you posted he affirms he is not opposed to an independent central bank, he rather wanted to look into how the policies in this one instance were handled. Also the comment about the Fed "covering it's tracks" is ridiculous. An audit is an audit, they would have to comply by law. The Fed is not a gang of criminals.
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@ Bolded Then your assumption is wrong. I have taken intermediate level macroeconomics, econometrics, and a financial crisis course as part of my economics minor at a top university. I know very well the arguments for central banks. That doesn't mean they do no wrong, however. Most people who oppose the federal reserve don't oppose central banks anyway.
Macroeconomics is not a unified, consensus driven field like microeconomics. Many economists have macroeconomic beliefs that central banks do just as much harm as they do good, and that there are alternatives to enabling elasticity in the financial market (the main reason for central banks.) I personally don't support replacing the federal reserve with a public central bank. However, I don't think the federal reserve handles anything better than other - even public - central banks in the world. They all practically are doing the same thing.
My personal beliefs are in competive currencies and replacing fiat currency/fractional reserve banking with market driven solutions.
@ Underlined When the audit is forewarned it is much easier to manipulate things so that the audit is in your favor. I think you have too much trust in the people in the federal reserve. They are no more virtuous when it comes to corruption than government officials, and they have a special privelege afforded to them by government officials no less.
