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America's eyes are on Congress, while they should be watching the Fed

By , - Last modified: October 16, 2013 at 9:05 AM
Joe Wirbick
Joe Wirbick - (Photo / )

As we move into the third week of the government shutdown and head towards the debt ceiling dilemma, everyone is watching and waiting on Congress.

Sides have been taken and lines have been drawn. Museums, national parks and memorials are closed. Citizens are outraged and taking to the streets in protest.

People are finding a voice they have not raised in years. However, perhaps it should be aimed towards a different branch of the government. Maybe we should turn our eyes away from Congress and the president for a moment and look at the Federal Reserve.

I know what you're going to say: "The Fed is not a branch of the U.S. government." I understand that we were taught in school that we had three branches: the legislative (Congress), the judicial, and the executive (the president). I would argue that we need to add the Federal Reserve to that list of checks and balances.

I feel that in our world today there is no other agency that has more control, more pull or more influence on our day-to-day lives than the Fed. It regulates our monetary policy on a daily basis. It artificially lowers interest rates in order for money to move more freely in our economy. It creates, out of thin air, billions of new dollars every month.

There would be no money for the federal government to borrow for wars, bailouts, and entitlement programs if the Fed did not continue to buy government debt.

Speaking of buying our debt, the Fed continues to do this at the rate of $85 billion a month. That is more than $1 trillion a year, just manufactured for the purpose of keeping interest rates low. I always thought we liked to sell our debt to other organizations, rather than just creating more debt to buy our own debt. Confused yet?

All of this happens with no vote from Congress, no input from the president, no say from the American people at all. It is run by one man, Ben Bernanke. He calls the shots. Sure, he gets input from other people … but they are other individuals in the Federal Reserve system. However, it all falls on Bernanke's shoulders; he is the one in the spotlight commanding the ship.

Mr. Bernanke has increased the Fed's balance sheet to nearly $4 trillion over the last few years. He has created billions of new dollars every month in an attempt to "fix" the system.

So while our government cannot spend money to keep our parks open or our memorials available, the Fed keeps printing away, buying our debt, and adding to a bill that has to be paid sometime in the future by our children.

If you want to protest, if you want answers as to what is going on in our country, maybe you should take a closer look at our Federal Reserve. I think you will be surprised at what you find.

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Joe Wirbick

Joe Wirbick

Joe Wirbick is the president of Lancaster financial services firm Sequinox. Joe specializes in retirement planning and distribution. Tax information is provided for informational purposes only.

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