So says Dallas Fed chief Richard Fisher. That’s not the half of it, Sunshine.
As the Financial Times puts it:
The Federal Reserve’s revelations underscore the might of unelected central bankers. The Treasury’s Tarp rescue fund, at $700bn, was considered so audacious that Congress at first refused to authorise it. But the Fed doled out no less than $3,300bn in loans to banks and companies without a congressional say-so.
Three-point-three-trillion dollars in loans, basically no oversight.
I’ve long been wary of the Ron Paul/“Audit the Fed” gang’s critique of the central bank, not because the Fed is so great, but because the mostly likely alternative — getting Congress heavily involved in day-to-day monetary-policy operations — seems to be very likely to be much, much worse, probably destructive, and possibly catastrophic. You may not like Ben Bernanke, but do you want Nancy Pelosi calling the shots? Barney Frank? Charles Schumer? Pick the congressional Democrat you’d rather have had in charge of monetary policy since 2006. Don’t worry, I’ll wait. (Heck, pick the congressional Republican you’d have wanted running the show during the 2008 crisis. Nobody leaps to mind. Candidate McCain’s performance in those dark days was wince-inducing.)
That being written, I don’t think we can have the central bank making multi-trillion-dollar loans to ailing banks and troubled non-financial firms without prior notice. Reforming the Fed is a can of worms that I am not particularly eager to see opened up at this moment, because the ranks of would-be reformers contain very few people that I would trust to do the job. (Approximately zero, in fact.) But it looks like it has to be done.
– Kevin D. Williamson is deputy managing editor of National Review and author of The Politically Incorrect Guide to Socialism, to be published in January.