What does the Federal Reserve do? Theoretically, it has a dual mandate of keeping inflation low and employment high, with the goal of promoting the “effective operation of the U.S. economy”.
It’s “about” page, describing that goal, what it’s supposed to be doing, and how it theoretically does those things, provides that the Fed:
- conducts the nation’s monetary policy to promote maximum employment, stable prices, and moderate long-term interest rates in the U.S. economy;
- promotes the stability of the financial system and seeks to minimize and contain systemic risks through active monitoring and engagement in the U.S. and abroad;
- promotes the safety and soundness of individual financial institutions and monitors their impact on the financial system as a whole;
- fosters payment and settlement system safety and efficiency through services to the banking industry and the U.S. government that facilitate U.S.-dollar transactions and payments; and
- promotes consumer protection and community development through consumer-focused supervision and examination, research and analysis of emerging consumer issues and trends, community economic development activities, and the administration of consumer laws and regulations.
Well, former Trump White House advisor Steve Bannon, one of the masterminds of Trump’s 2016 victory and the man behind most of Trump’s more New Right-type policies, has a different perspective on what the Federal Reserve has really been up to: in his view, it’s a tool that a small coterie of bankers have used to enrich themselves at the public’s expense.
According to him, the Federal Reserve has usurped the power of the American people and has worked as a small cabal of bankers to funnel assets from the lower and middle class to the unfathomably wealthy oligarchs.
Further, according to Bannon, the time has come not to audit the Federal Reserve and find out what balance sheet tricks it has been up to but rather to end it for good, returning power over financial matters to the American people and their representatives.
Those comments came when Bannon, a former Goldman Sachs banker, tore into the Federal Reserve during his speech at Texas CPAC, saying:
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“0.5% of the citizens in this country own more assets than the bottom 90%. That’s all happened in the last ten years since 2008. The Federal Reserve, by the way, is not owned by the America people, a central bank that is owned by 24 prime brokers, being J.P. Morgan and Goldman Sachs and Morgan Stanley. How does that work?”
It was then that Bannon turned to saying that we need to end the Fed, saying:
“We don’t need to audit the Fed, we need to end the Federal Reserve. The Federal Reserve has usurped its power and the power of the American people and our elected representatives. And, no, they do not have the consent of the governed. We will not comply. We will not submit. And it must be ended.”
Watch him here:
BANNON: "The Federal Reserve has usurped its power and the power of the American people and our elected representatives" pic.twitter.com/pECX5qrpB7
— Benny Johnson (@bennyjohnson) August 6, 2022
Even on the MAGA side of the GOP Bannon is something of a radical, associated more with the “Bronze Age Mindset” and the works of Julius Evola than traditional American political thought.
So, Trump’s White House might not take action and end the Fed in 2024. In fact, it almost certainly won’t. Still, the fact that Bannon is promoting such a radical course of action and the crowd seems interested shows that momentum might be building among the MAGA base for out-of-the-box, radical solutions to pressing problems.