The Federal Reserve is facing its severest scrutiny since the 1930s, both from an aroused public and from members of Congress, some of whom face tough reelection fights next year and know they will have to answer to the public. Moreover, scrutiny of the Fed has moved from Internet-only “conspiracy sites” to mainstream reportage — for example, "Analysis: Fed under fire as public anger mounts" and "Fed rage boils over on Capitol Hill."
We dont have to hire historians to see where deficit spending will take us. We have only to look around now. Since the end of World War II, some of history's greatest national disasters have taken place right here in the Americas. North Americans used to laugh or shake their heads at the economies of the south that seemed always on the brink of collapse. Banana republics, we derisively called them. We're not laughing now.
President Obama’s stimulus package is reviving the economy and providing work for eager Americans all over the country. Don’t believe it? Just ask the folks that live in Arizona’s 15th Congressional District.
Anyone trying to figure out what in the world is going on in today’s economy might remember Agatha Christie’s classic, Murder on the Orient Express. When master sleuth Hercule Poirot boarded that train, he’d no idea that before the night ended he’d face the most perplexing murder case ever. A carful of passengers, all of whom had motive and opportunity, maneuvered around so skillfully that even Christie’s brilliant Belgian couldn’t figure out whodunit. The best he could do was point a perfectly manicured finger at the most likely culprits — in the end, everybody walked away, except the luckless victim.
Senator Christopher Dodd and fellow Senate Democrats are proposing to scale back the regulatory authority of the Federal Reserve and eliminate the Office of the Comptroller of the Currency, among many other provisions in a new 1,136-page bill made public on Tuesday. Dodd, the chairman of the Senate Banking Committee, blamed the Fed for alleged failures in consumer protection and regulatory oversight that contributed to last year’s financial implosion.
In Robert J. Samuelson’s latest op-ed piece for the Washington Post, “Could America Go Broke?”, the longtime editor and economic and business writer — who can normally be counted upon to prescribe the usual Keynesian claptrap for our sundry economic woes — actually flirts with common sense. In his piece, Samuelson dares to ponder the unthinkable: What if the rest of the world lost confidence in the viability of the dollar, and America could no longer service her fourteen-figure national debt by printing more money?
According to the White House on October 30, the $787-billion stimulus plan has created or saved about one million jobs, but that number is conveniently unverifiable. There is simply no way to know with certainty how many workers would have lost their jobs without the stimulus. And of course, the admininstration-supplied estimate does not even take into account how many jobs may have been lost because of the stimulus program, ignoring the fact that the "stimulus" money that was used to create jobs in certain government-favored sectors of the economy had to be siphoned out of the economy as a whole, destroying jobs elsewhere.
Less than a week after Federal Reserve Chairman Ben Bernanke urged Congress to act with dispatch to pass new legislation giving the Fed and the Federal Government more surveillance powers and control over the financial sector, the Obama administration has unveiled a bill that, if passed, would put most of Bernanke’s proposals into effect.
The G-20 Pittsburgh summit is over, and the Steel City is returning to normal. For the rest of the world, however, the latest gathering of leaders of the world’s 20 strongest economic powers is likely to mark a turning point towards more comprehensive international regulation and control over finance and banking.