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No New Powers for the Fed

In just 10 months, the Federal Reserve has handed trillions of taxpayer dollars to the banks without telling taxpayers who got the money and whether we'll ever get it back. The Fed colluded with the banks to inflate bubbles and helped spark the biggest crash since the Great Depression. Since then it has been funding billion dollar CEO bonuses for the banks that sit on their boards of directors.

Moreover, in some important respects, the Fed seems to not even know what it's doing itself, as this Congressional questioning of Federal Reserve Inspector General Elizabeth Coleman seems to suggest.

Peter Rothberg

September 11, 2009

In just 10 months, the Federal Reserve has handed trillions of taxpayer dollars to the banks without telling taxpayers who got the money and whether we’ll ever get it back. The Fed colluded with the banks to inflate bubbles and helped spark the biggest crash since the Great Depression. Since then it has been funding billion dollar CEO bonuses for the banks that sit on their boards of directors.

Moreover, in some important respects, the Fed seems to not even know what it’s doing itself, as this Congressional questioning of Federal Reserve Inspector General Elizabeth Coleman seems to suggest.

While the Fed operates in virtual secret and opposes legislation that would audit their performance, Treasury Secretary Tim Geithner is proposing legislation to expand the powers of the Fed by making the organization the “supercop” for system-wide risk throughout the economy. This is exactly the wrong approach. In order to be accountable to the public which it theoretically serves, the Fed must be reformed, not given dramatic new powers.

That’s the message of a new campaign from A New Way Forward, a grassroots group determined to spark a fundamental re-making of Wall Street. I last wrote about ANWF back in April on the cusp of the group’s national protests calling for an alternative bailout that would break up the financial oligarchy.

Now, ANWF is sponsoring a “Say No to New Powers for the Fed” petition. Add your name, learn more about the alternatives to the financial status quo, and tell all your friends about the positive solutions.

PS: If you have extra time on your hands and want to follow me on Twitter — a micro-blog — click here. You’ll find (slightly) more personal posts, breaking news, basketball and lots of links.

Peter RothbergTwitterPeter Rothberg is the The Nation’s associate publisher.


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