Robert Higgs on Bernanke and the Federal Reserve on Fox News “Freedom Watch”

Independent Institute Senior Fellow Robert Higgs is interviewed here on Fox News “Freedom Watch with Judge Napolitano,” regarding the Federal Reserve System. Based on his recent article, “A Reader’s Guide to Bernanke’s Preemptive Attack” on The Beacon, Dr. Higgs responds to the November 29th Washington Post article by Ben Bernanke, “The right reform for the Fed,” in which just days before his re-nomination, confirmation hearing as continued Fed Chairman, Bernanke states his strong opposition to the “Audit the Fed” amendment by Congressman Ron Paul (HR 1207: Federal Reserve Transparency Act of 2009) to the Financial Stability Improvement Act of 2009 (HR 3996). “Audit the Fed” has 317 co-sponsors in the U.S. House of Representatives and 30 co-sponsors in the Senate and would authorize the General Accounting Office to audit and make public the complete operations of the Federal Reserve. According to Bernanke however:

These measures are very much out of step with the global consensus on the appropriate role of central banks, and they would seriously impair the prospects for economic and financial stability in the United States.

The government’s actions to avoid financial collapse last fall — as distasteful and unfair as some undoubtedly were — were unfortunately necessary to prevent a global economic catastrophe that could have rivaled the Great Depression in length and severity, with profound consequences for our economy and society

In response in his article, Dr. Higgs states:

Monetary-policy propaganda is a high art . . . . Let’s get serious. If the Fed is known for anything historically, it is for first pushing the monetary accelerator to the floor, then stomping on the monetary brake. To praise this outfit for its contribution to financial and economic stability is akin to praising Josef Stalin for his commitment to human rights. . . . had the government refrained from all of its extraordinary interventions of the past year or so, the worst of the adjustments would already have been made, and a genuine recovery would now be in progress.

David J. Theroux is Founder, President and Chief Executive Officer of the Independent Institute and Publisher of the quarterly journal, The Independent Review.
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