It Doesn’t Really Matter Who Runs the Fed

Betsey Stevenson and Justin Wolfers note that the Fed has consistently undershot its inflation target lately. Monetary policy today only makes sense if the Fed not only doesn’t care about unemployment at all, but also, for some reason, is hellbent on getting inflation under its 2% target. Matt Yglesias is contempuous: “Ben Bernanke has brought us the lowest inflation of any Federal Reserve Chairman of the postwar period. You may call it prolonged mass unemployment, but he may see it as a huge success.” Atrios goes even further:

I do wish more people who are maybe a bit more respectable than I am would start using moral language to describe the reprehensible actions of Bernanke and pals. There’s no possible analysis of the welfare tradeoffs of these policies which leads to any other conclusion than “mass unemployment is a small price to pay for keeping the rich fat and happy, or even fatter and happier.”

Time to end our failed experiment in “independent” central banking.

I don’t really disagree with any of this except for one thing: what makes anybody think that monetary policy would be any different if the Fed weren’t independent? It’s not clear to me that Tim Geithner would run things much differently, and it’s sure as hell not the case that Congress would suddenly get religion and ease up on monetary policy.

The problem, I think, isn’t Fed independence. It’s the mindset of the entire financial elite in the developed world. Until that changes, it hardly matters who runs the Fed.

OUR NEW CORRUPTION PROJECT

The more we thought about how MoJo's journalism can have the most impact heading into the 2020 election, the more we realized that so many of today's stories come down to corruption: democracy and the rule of law being undermined by the wealthy and powerful for their own gain.

So we're launching a new Mother Jones Corruption Project to do deep, time-intensive reporting on systemic corruption. We aim to hire, build a team, and give them the time and space needed to understand how we got here and how we might get out. We'll publish what we find as a major series in the summer of 2020, including a special issue of our magazine, a dedicated online portal, and video and podcast series so it doesn't get lost in the daily deluge of breaking news.

It's unlike anything we've done before and we've got seed funding to get started, but we're asking readers to help crowdfund this new beat with an additional $500,000 so we can go even bigger. You can read why we're taking this approach and what we want to accomplish in "Corruption Isn't Just Another Scandal. It's the Rot Beneath All of Them," and if you like how it sounds, please help fund it with a tax-deductible donation today.

We Recommend

Latest

Sign up for our newsletters

Subscribe and we'll send Mother Jones straight to your inbox.

Get our award-winning magazine

Save big on a full year of investigations, ideas, and insights.

Subscribe

Support our journalism

Help Mother Jones' reporters dig deep with a tax-deductible donation.

Donate