Target: Tim Scott, Chair of Senate Banking Committee
Goal: Stop political interference in Federal Reserve’s independent and stabilizing operations.
America’s central bank, the Federal Reserve, is critical to maintaining stability in the national economy, during both good times and bad times. In order to maintain this stability, the bank must have the independence and the freedom from political pressure granted to them under federal law. The Trump administration wants to end this independence, and the economic consequences could be catastrophic.
Tensions have risen since the administration’s start over Fed Chair Jerome Powell’s refusal to lower interest rates. When economic slowdown combines with rising unemployment, interest rates are typically not lowered in order to prevent inflation, a worse condition called stagflation, and a subsequent economic spiral (such as happened before The Great Depression). But because the Chair is exercising caution and refusing to bend to the president’s will, the president has called for his firing (although he has no authority to make this move). The president compounded the chaos with his recent attempted illegal dismissal of Fed Governor Lisa Cook.
If the president is successful in making this firing happen, many suspect he plans to replace the governor with his top economic adviser: a man who has publicly called to weaken the U.S. Dollar and to place the independent Federal Reserve under complete control of the president. If this worst-case scenario were to occur, the Fed would become politicized and the entire economy would suffer as a result. In countries where similar takeovers have happened (dictatorial regimes), inflation has skyrocketed thousands of percentage points and standards of living have cratered.
Congress must rubber-stamp this latest appointment and approve of fundamental changes to the Federal Reserve Act. Given their pattern of ceding increasing authority to the president, we must act now to make our voices heard. Sign below to warn against gifting unchecked control of the American economy to a man with several bankruptcies to his name.
PETITION LETTER:
Dear Senator Scott,
“Placing Fed officials under the thumb of the President would seem to mean more politics.” Conservative economic John Cochrane had this blunt response to word of the Trump administration’s plans to launch a hostile takeover of the independent Federal Reserve. More politics, and a reported intentional weakening of the U.S. dollar, is the last course of action a teetering economy needs.
The Great Depression was supposed to teach this country an unforgettable lesson about political interference in matters of large-scale economic importance. If this crisis didn’t do the trick, then perhaps more modern-day examples around the world should. Take Venezuela, for example: the country this administration wants to target for a ban on refugees. A sizeable percentage of the chaos that is driving mass migration in that country resulted from a dictator’s seizing of the economic levers… a consequence that created levels of inflation that would make American politicians blanch.
Such a takeover – and the crushing consequences it would bring – can only happen in America if Congress allows it. It’s time to take a stand for the long-term wellness of every American’s livelihood. Do not greenlight Stephen Miran’s appointment to the Fed’s governorship. Do not okay a gutting of the Federal Reserve Act. And do not aid and abet a wholesale attack on America’s economic stability.
Sincerely,
[Your Name Here]
Photo Credit: Karolina Grabowska
