By Paul Dupont
There is a new movement afoot in Washington DC: a movement for monetary reform.
This past week in the House, Rep. Kevin Brady (R-TX) introduced the Centennial Monetary Commission Act, a bill which would “establish a commission to examine the United States monetary policy, evaluate alternative monetary regimes, and recommend a course for monetary policy going forward.”
In other words, Congress may finally be taking the first step to reigning in the dysfunctional Federal Reserve policies which continue to hold the country back economically.
In the century since the creation of the Federal Reserve system, this country has seen a great deal of economic and financial instability. Thanks in part to a monetary system which has detached the value of the U.S. dollar from any stable base, the country has suffered through financial bubbles and collapses, lengthy economic downturns, and periods of high inflation, all while the dollar has slowly lost its purchasing value, hurting middle and working class families.
In addition, these Federal Reserve monetary policies have also allowed the federal government to spend its way into a $16 trillion (and counting) hole, risking hopelessly burying future generations of Americans under a mountain of debt.
Recognizing the problems which these policies continue to cause, the Republican Party in 2012 included in its platform a call for a “commission to investigate possible ways to set a fixed value for the dollar.” However, this call need not be a partisan one.
As reportedly outlined in Rep. Brady’s bill, the new commission would be chaired by an equal number of Democrats and Republicans: three Congressional leaders each as well as three members appointed by each party. The commission would also include two non-voting members appointed by the Secretary of the Treasury and the Chair of the Federal Reserve Board of Governors. Thus, any recommendations coming from this commission would of necessity be bipartisan.
Given that this year is the hundredth anniversary of the creation of the Federal Reserve, there would seem to be no better time for our legislators to step back and evaluate the institution’s performance as well as grapple with its failures. The Centennial Monetary Commission Act represents a valuable opportunity for Congress to finally move toward this goal of much-needed monetary reform.
Paul Dupont is a research assistant with American Principles Project who is currently a fellow in the John Jay Institute program in Philadelphia.
Photo Credit: Michael Daddino via Flickr (CC-By-2.0)