James Pethokoukis

Politics and policy from inside Washington

Not a (Peter) Diamond in the rough

June 6, 2011

The problem with the Federal Reserve is not that an “activist Keynesian” — in the words of the Club for Growth — like Peter Diamond can be appointed to such a powerful economic policymaking body. His views are, unfortunately, well within the mainstream of economic policymaking. The problem is that Diamond and the other Fed members really don’t matter. As one former Fed member said to me, “If you see someone from the Fed talking on TV and he’s doesn’t have a beard, feel free to ignore him.”

In other words, the only guy that counts is The Ben Bernank. ¬†And it should be of great worry to Americans that one man — or even group of men and woman — have so much control over the U.S. economy. It is the Federal Reserve that is the problem. It is an unaccountable central bank printing money to buy bonds to goose a dysfunctional economy that is the problem.

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