Do Not Trust Governments With The Control Of Money

If there one thing that is fairly certain in this life – besides the seeming inescapability of death and taxes – is that once someone is appointed to almost any position in the political and bureaucratic structures of a government they soon discover how important and essential is the organization of which they are a part for the well-being of the nation. The country could not exist without it, along with its increasing budget and expanded authority. This applies to the Federal Reserve, America’s central bank, no less than other parts of government.

The news media has reported that the apparently unlikely appointment of Dr. Judy Shelton to the Federal Reserve Board of Governors probably will be successfully maneuvered through the full Senate confirmation process. Shelton would then sit on the Federal Reserve Board filling the balancing a term that ends in 2024 and then made eligible for a 14-year term. Hers has been one of the more controversial nominations to the Fed in recent years, with critics fervently expressing their negative views of her.

For instance, Tony Fratto, a former Treasury official and deputy press secretary under George W. Bush, was recently quoted as saying that Shelton’s appointment would be “a discredit to the Senate and the Fed. It screams. Nothing at all is serious. Not us. Not you. Not them.”

Mainstream Economists Against Anyone for Gold

Back in August of this year, over one hundred academic and business economists issued an open letter to members of the U.S. Senate calling for rejection of her nomination to the Fed. Among those who signed were some economics Nobel Laureates, including Robert Lucas and Joseph Stiglitz. They insisted on her unfitness for such an appointment. Why? They said: “She has advocated a return to the gold standard; she has questioned the need for federal deposit insurance; she has even questioned the need for a central bank at all.”

They also accused her of hypocrisy, saying that Shelton had changed her stance on Federal Reserve policy and the institution’s relevance based simply on a desire to be appointed to the Fed board, and to serve the wishes of the president who had nominated her. So, she stands damned if she opposes the Fed with her call for a gold-backed currency, and she is damned if she modifies her positions on monetary policy supposedly to be more palatable to the Senators deciding her professional fate. Clearly, her critics would only stop being critical if they were somehow convinced that Judy Shelton truly loved the Fed, hated the gold standard, and supported “activist” monetary policy and interest rate manipulation; and for the full 14 years of her term on the Fed Board.

Political campaigns are full of people who say that they are drawn to higher echelon government employment so they can “give back” to or “serve” the country, and no doubt there are some who are seriously sincere when they say so. But who can deny that what also appeals to such people, and many others who are far more crudely opportunistic, is the attraction of being a “player” and an “insider” in the various halls of political power and decision-making in determining the bigger picture of the “shape-of-things-to-come?”

And it may be that Judy Shelton, based on her own statements of desiring to “serve” the country in this particular capacity, truly wants to, even with all her apparent changing views and emphases. Or maybe it’s all a game to say what she thinks others want and need to hear so that will approve her as a Board member of the Federal Reserve, and then sit at the Big Boy’s – oh, I mean the Big Person’s – table.