The Constitution states that the Senate has to ratify all treaties. Yet “treaties” entered in to by the Federal Reserve are not subject to any elected authority whatever. Consider this: The governing body for the Basel Committee on Banking Supervision reached an agreement a few weeks ago on the major elements of a new financial regulatory architecture, commonly known as Basel III. By increasing the quantity and quality of capital that banking firms must hold and by strengthening liquidity requirements, Basel III aims to constrain bank risk-taking, reduce the incidence and severity of future financial crises, and produce a more resilient financial system. The key elements of this framework are due to be finalized by the end of this year.
This sounds reasonable, doesn’t it? Yet it is happening beyond the realm of democracy. It is literally the case that important decisions are being made, that will affect the lives of Americans in important ways, that we have absolutely NO control over. The Senate has no control. The President has no control. They could use the public stage to voice opposition, but legally they can do nothing. There is no counterbalance, no counterweight to the aggregated power of the Federal Reserve.
Every election cycle the economy is an issue, it seems. Yet no one talks about the Fed. This is lunacy. A credible case could be made that it should be brought within the direct control of Congress or the Executive Branch, but no case can be made that an entity which has the power to change all of our lives for the better AND for the worse should be given nearly complete control over our fiscal policy.