by Jerry Alatalo
-SPAN televised part of the U.S. Senate committee meeting with Federal Reserve Chair Janet Yellen today. The topic of a possible Government Accountability Office (GAO) audit of the Fed came up, and Chair Yellen produced an audit recently conducted on the Fed’s books by Deloitte & Touche, one of the “Big Four” accounting firms. It is worth noting that the “Big Four” accounting firms have for decades been heavily involved in the global tax haven/evasion industry.
Ms. Yellen held the Deloitte audit binder up more than once when the topic of a GAO audit came up, and her response was that an audit by the GAO would not be good because it would “politicize” the Fed’s operations and prevent Fed actions to meet its mandates of increasing employment and controlling inflation. She used the example of Fed Chair Paul Volcker in the 1970’s, and how he would have been somehow unable to take the steps he did to fight 20% inflation if such a GAO audit occurred during that time.
One has to wonder how a GAO audit would get “in the way” of any Federal Reserve operations whatsoever, or “politicize” the central bank with negative consequences. Ms. Yellen’s opening statement to the committee was typical of former Fed chairs Ben Bernanke, Alan Greenspan and the rest going back to 1913 when the Federal Reserve system began with passage of the Federal Reserve Act signed into law by President Woodrow Wilson. Trillions of dollars in quantitative easing is part of the “accommodative” mode chosen by Fed top management after the economic crash of 2007-8. The Fed chair assures senators she still focuses on its mandate from the government: increased employment and 2% inflation targets.
Those two mandates were referenced time and again in Ms. Yellen’s opening remarks and in answers to questions posed by senators on the committee. The discussion back and forth between her and senators seemed like people asking softball questions and receiving softball answers. No senator asked if the Federal Reserve should become nationalized as a government (people) owned public utility, and if that wasn’t more beneficial for the nation’s economy and its citizens. No senator asked Ms. Yellen “who actually owns the Federal Reserve?”, or “who are its major shareholders?”
Watching Fed chairs address lawmakers has become an experience in continuing disappointment upon seeing elected leaders basically kneeling before the “financial wizards” running the monetary affairs of the United States. One wonders if those elected leaders are aware that the founders of the country fought the British solely to escape from financial tyranny, and that the founders fought to control monetary creation power on behalf of the people – against the King of England.
A significant number of states, counties and cities are looking seriously into establishing public banks to keep money inside their regions and locales instead of giving it in large quantities to Wall Street banks in the form of high interest payments, fees, and questionable, often-complex, losing investments. As states come to entertain the idea of public banking, it is worth remembering that nations can also establish a public bank. The late British political leader Tony Benn was integral in establishing public banking in that nation; the banks were operational and successful until Margaret Thatcher came to power and abolished them. A number of countries around the world operate large public banks.
So, the idea of public banking never received any attention during today’s senate meeting with Ms. Yellen. This is understandable when one considers the enormous amount of campaign contributions going to politicians from the financial industry and Wall Street too-big-to-fail/prosecute banks. Senator Elizabeth Warren of Massachusetts pressed Ms. Yellen on the issue of leaks which allow people to profit greatly on market transactions, and the Fed’s opinion of Dodd-Frank provisions. What is refreshing about Ms. Warren’s interaction and questioning of Ms. Yellen is her disciplined intent to not allow the Fed chair to go off on evasive, distractive tangents of obfuscation.
In the over hundred years since the creation of the Federal Reserve in 1913, unfortunately the American people have become the financial victims of people who believe that furtherance of their own interests and maintaining immeasurable power and control over the nation’s monetary system relies to a large extent on the concept: “baffle them with bullshit”. Thankfully, leaders like Elizabeth Warren fight for the people against those who use all the tricks in the legal, accounting, public relations and finance books to maintain enormous power and privilege.
It is worth noting that C-SPAN cut to the floor of the Senate approximately thirty seconds into Senator Warren’s time for questioning of Janet Yellen. Was it just a coincidence?
(Thank you to Lord Rothschild ( 🙂 ) at YouTube)