THE WASHINGTON UNION PAPERS: NO. 17

WHY THE FEDERAL RESERVE MUST BE REFORMED & MADE ACCOUNTABLE

To the People of the United States,

For over a century, the Federal Reserve has operated like a hidden puppeteer, pulling the strings of America’s economy while the people pay the price for its failures. It was sold to the nation as a stabilizing force, as a guardian against financial crises, yet it has proven to be their greatest instigator. Time and again, it has injected reckless liquidity into the economy, setting the stage for catastrophic collapses, only to offer itself as the sole entity capable of cleaning up the mess it created. It is a self-perpetuating cycle of manipulation and rescue, a system where failure is not punished but rewarded, where the reckless are made whole while the working class foots the bill.

It prints money at will, devaluing the wages and savings of the American people under the guise of monetary policy. The dollar, once as good as gold, has been steadily eroded by the very institution entrusted to protect it. When the Federal Reserve abandoned the gold standard in 1971, severing the last ties between the dollar and tangible value, it granted itself the power to create money from nothing, unleashing inflationary forces that have ravaged middle-class wealth ever since. The purchasing power of the dollar has declined by over 96 percent since the Fed’s inception, turning what was once a stable currency into a tool for the ruling financial elite. Prices rise, wages stagnate, and the Federal Reserve insists it is acting in the interest of stability while ensuring that the cost of living crisis deepens with every passing decade.

It fuels bubbles it cannot contain. The roaring stock market of the 1920s, the dot-com frenzy of the 1990s, the housing boom of the 2000s—all artificially inflated by loose monetary policy, all culminating in spectacular crashes that wiped out savings, destroyed jobs, and brought entire industries to their knees. Each time, the Federal Reserve stood as the arsonist and the firefighter, pumping excess liquidity into the system, watching as speculative mania took hold, then stepping in when the inevitable collapse arrived, rewarding the very financial institutions that profited from the instability. The 2008 financial crisis was not an accident. It was the product of a Federal Reserve that kept interest rates artificially low for too long, fueling a housing bubble built on fraudulent lending and speculative gambling. When it all came crashing down, it was the American taxpayer who was handed the bill while the Federal Reserve bailed out Wall Street’s biggest players, ensuring that their wealth remained untouched as the rest of the country suffered.

It crashes markets it cannot stabilize. The Fed claims to have mastered the business cycle, to have the tools necessary to prevent financial disaster, yet history proves otherwise. The Great Depression was exacerbated by its failures. The stagflation of the 1970s was worsened by its incompetence. The dot-com collapse, the Great Recession, the COVID-era inflation spiral—each crisis has played out under the watchful eye of the Federal Reserve, an institution that claims omnipotence in times of prosperity but shrinks from accountability in times of crisis. It operates with the arrogance of a central planner and the recklessness of a gambler, convinced that it can steer the entire economy through interest rate manipulation and monetary expansion, yet every attempt to do so ends in economic upheaval.

It bails out the very institutions that rig the game. When the Federal Reserve steps in to prevent economic collapse, it does not do so for the average American. It does not rescue the small business owner drowning in debt. It does not stabilize the wages of the worker crushed under the weight of rising costs. It rescues the banks, the hedge funds, the multinational corporations that have spent decades exploiting its policies for profit. The financial sector does not fear risk because it knows the Federal Reserve will always be there to socialize its losses while privatizing its gains. Trillions were spent propping up banks in 2008 while millions of Americans lost their homes. Billions were funneled into corporate bailouts during the COVID crisis while small businesses were left to shutter. The Federal Reserve is not the guardian of the American economy. It is the financial cartel’s most loyal enforcer, ensuring that no matter how reckless their actions, no matter how speculative their bets, they will always be protected.

It answers to no voter, no election, no democratic force—only to itself and the financial elite it was built to protect. The American people have no say in the policies that determine the value of their wages, the cost of their mortgages, the trajectory of their economy. These decisions are made behind closed doors by unelected officials who serve not the citizen, but the system that keeps them in power. The Fed’s meetings are not public debates. They are secret gatherings where monetary policy is dictated by those who will never face the consequences of their actions. The very notion of economic democracy is a lie so long as the Federal Reserve remains beyond the reach of the American electorate. It is a system that was designed to be untouchable, an institution that operates under the illusion of public service while acting as the private fortress of the financial class.

This is not stability. This is not sound monetary policy. This is an economic stranglehold, and the time to break it is long overdue. The Federal Reserve has ruled unchecked for over a century, and its failures have been tolerated for too long. The power to control the nation’s money supply, to dictate the terms of economic expansion and contraction, to determine the fate of businesses, wages, and entire industries cannot remain in the hands of an institution that serves no master but itself. The Federal Reserve must be reined in, restructured, and, if necessary, dismantled entirely. No system that claims to serve the people can exist beyond their control. The era of central banking dominance must end, and the era of true economic sovereignty must begin.

The Federal Reserve was never meant to be an untouchable empire, yet it has grown into one. It was never designed to be above accountability, yet it operates as if it is. It is a system that manipulates interest rates in secret meetings, that devalues the wages of hardworking Americans through reckless inflation, that props up Wall Street while Main Street crumbles. The dollar belongs to the American people, yet it is wielded like a private weapon by unelected bankers who hide behind the illusion of expertise while plundering the future of the very nation they claim to serve.

This cannot stand. The Federal Reserve must be reformed. It must be stripped of its unchecked power, its operations made fully transparent, its authority returned to the representatives of the people. The illusion that monetary policy is too complex for democratic oversight has been the greatest fraud ever perpetrated on the American public. The economy is not an abstraction, not a puzzle meant to be solved by technocrats in closed-door meetings. It is the collective labor, savings, and investments of the American people, and the institution that governs its currency must answer to them.

The Federal Reserve has long operated under the pretense that independence is essential to sound monetary policy, yet history has shown that this independence has meant nothing more than insulation from accountability. While every other branch of government is subject to constitutional checks, the Federal Reserve wields its power with impunity. It manipulates interest rates, expands and contracts the money supply, and directs economic outcomes without fear of reprisal, without voter input, and without regard for the long-term consequences of its decisions. This is not the system envisioned by the founders. Hamilton, in designing the early American financial system, argued for a national bank that would serve the interests of industry, commerce, and national development—not a secretive cartel of bankers operating beyond the reach of democratic institutions. Even Andrew Jackson, in his fight against the Second Bank of the United States, understood the danger of placing economic control in the hands of an unelected elite. The lessons of history demand action.

Monetary policy cannot remain the exclusive domain of unelected bankers whose interests are tied to the institutions they claim to regulate. The same financial firms that benefit from the Fed’s policies—the megabanks, hedge funds, and multinational corporations—are the ones that dictate the framework of those very policies. The Federal Reserve’s revolving door with Wall Street has turned it into a mechanism for consolidating financial power rather than serving the needs of the broader economy. Those who set interest rates, who determine inflation targets, who oversee financial stability should not be drawn from the same institutions that stand to profit from those decisions. A truly independent central bank is one that is independent from financial elites, not one that is independent from the public it serves.

The dollar belongs to the American people, not to the Federal Reserve. The stability of its value should not be dictated by a handful of central planners who have repeatedly proven their fallibility. Inflation is not a natural force—it is a policy decision. The Federal Reserve, in its obsession with economic expansion at all costs, has prioritized cheap credit over sound money, flooding the economy with excessive liquidity, debasing the currency, and eroding the purchasing power of workers. The people’s money should not be devalued to bail out reckless speculation. It should not be printed into oblivion to serve the interests of financial institutions that take no responsibility for the crises they create. A stable currency is the bedrock of a strong economy, and no unelected body should have the power to manipulate it in secrecy.

Interest rates, inflation control, and economic stability must be managed not in secret but through accountable, democratic oversight. The idea that monetary policy must be shielded from political influence is a lie that has enabled the Fed to operate in the shadows, accountable only to its own internal decision-making. But if the economy belongs to the people, then the policies that govern it must be subject to public scrutiny. Congress, elected by the people, must reassert its authority over the nation’s monetary framework. The Federal Reserve’s actions should be subject to full transparency, its decision-making processes fully open to oversight, its justifications made clear to the citizens whose lives are impacted by every interest rate hike, every liquidity injection, every decision that dictates the value of their labor and savings.

If the Federal Reserve is to continue to exist at all, it must do so as an institution fully under the control of Congress, subject to the same checks and balances that govern every other branch of government. Its decisions must be reviewed, its policies subject to challenge, its governors answerable not just to Wall Street, but to the citizens whose livelihoods depend on the stability of the currency they earn. This does not mean turning monetary policy into a political circus, but it does mean ensuring that the most powerful economic institution in the nation does not operate as a law unto itself. The Constitution grants Congress the power to coin money and regulate its value—not a private banking cartel, not an unelected board of financial elites. The time has come to return that power to the people’s representatives, to break the stranglehold of centralized banking, and to restore the principle that economic sovereignty belongs to the nation, not the bankers who have profited from its decline.

Yet reform alone is not enough. The American people must consider whether the time has come to create a new financial order, one that places the interests of the nation above the profits of private banks. The Federal Reserve, by its very structure, exists to serve as a buffer between financial elites and democratic accountability. It is an institution designed to protect the banking system first and foremost, rather than ensuring that monetary policy serves the broader public. The very nature of its existence creates a permanent conflict of interest—one where the needs of financial markets are prioritized over industrial growth, over national investment, over the prosperity of the working people. This is not the system Hamilton envisioned. This is not the financial architecture of a nation that seeks to dominate the 21st century.

Hamilton’s vision was not of a Federal Reserve but of a national bank—one that would issue currency directly, that would finance industrial expansion, that would serve as the foundation of American economic strength. When Hamilton proposed the First Bank of the United States in 1791, he understood that a strong economy required more than just a stable currency. It required an institution that could provide credit for infrastructure, support domestic manufacturing, and defend the economy from foreign manipulation. The First and Second Banks of the United States were not mere facilitators of financial speculation. They were national engines of economic growth, directing resources toward the expansion of industry, internal improvements, and technological innovation. They provided stability not by bailing out reckless financiers, but by ensuring that capital was allocated toward national development. Their dissolution led to chaos—wildcat banking, unregulated currency issuance, financial instability. The lesson was clear then, and it remains clear now: without a national banking institution designed to serve the interests of the people, the economy will always be at the mercy of private interests that serve only themselves.

The modern economy demands a modern institution—one that is not beholden to international financiers, one that does not inflate speculative bubbles to enrich asset holders, one that does not sacrifice economic sovereignty on the altar of global markets. The Federal Reserve has proven incapable of managing these responsibilities. It has enabled financialization, where money is made not through production but through the endless shuffling of assets, through derivatives and stock buybacks, through the detachment of capital from tangible economic growth. Under its watch, America has gone from a nation that built to a nation that borrows. It has allowed foreign creditors to dictate terms to the United States, subordinating national financial policy to the whims of international markets. It has presided over a system where credit is easily available for speculation but increasingly difficult to obtain for those who wish to build factories, construct infrastructure, or create the industries of the future.

A National Bank of the United States, accountable to Congress, with a mandate to fund infrastructure, industry, and domestic investment, would serve the republic far better than a Federal Reserve that has proven itself incapable of managing the financial well-being of the American people. This is not a call for central planning, nor for a command economy. It is a call for financial sovereignty, for the ability to direct capital where it is needed most, for a system that does not reward Wall Street at the expense of Main Street. Such a bank would operate not as a mechanism for endless liquidity injections into speculative markets, but as an institution dedicated to national development. It would ensure that American industry has the financing it needs to compete with foreign manufacturers that benefit from the direct support of their governments. It would provide stable, long-term investment in the technologies that will define the next century, from artificial intelligence to advanced manufacturing, from nuclear energy to space exploration. It would break the cycle of financial crises fueled by the unchecked expansion of credit for speculation, replacing it with a system built on investment in real, tangible economic strength.

This is not a radical idea. The great industrial powers of history have all understood the necessity of state-directed financial institutions. Germany’s economic rise in the 19th century was fueled by its national banking system, which provided direct credit to industry. Japan’s post-war economic miracle was facilitated by the Bank of Japan’s targeted lending policies. China’s dominance in global manufacturing has been made possible by a state-controlled banking sector that directs capital toward industrial expansion rather than financial speculation. The United States must learn from these examples, not as a means of imitating foreign models, but as a recognition that financial independence is inseparable from national strength.

A National Bank of the United States would not replace the free market—it would fortify it. It would not eliminate private banking—it would force it to operate in service of national prosperity rather than in pursuit of short-term profits. It would not stifle competition—it would enhance it by ensuring that small businesses, entrepreneurs, and domestic manufacturers have access to the capital they need to compete with multinational corporations that have long benefitted from preferential treatment under the Federal Reserve’s policies.

The time has come to ask whether America will continue to allow its financial system to be governed by those who profit from economic instability, or whether it will reclaim the power to direct its own economic future. A National Bank of the United States is not just an option. It is an imperative. The financial system must serve the people, not the other way around. The era of private banking dominance must end, and the era of national financial sovereignty must begin.

The era of unchecked central banking must end. No longer can the fate of an entire nation be dictated by an unelected cartel of financial overlords who manipulate the economy like puppeteers, pulling strings in the shadows while the American people bear the burden of their arrogance. No longer can a privileged class of technocrats gamble with the currency of the working class, inflating away wages, devaluing savings, and bailing out their cronies when their house of cards collapses. The Federal Reserve is not a guardian of stability—it is an architect of instability, a machine designed to serve the financial elite while pretending to be a steward of the public good. Its unchecked power has hollowed out industries, eroded purchasing power, and placed the wealth of the nation in the hands of those who produce nothing but debt and crisis.

The United States cannot allow its economy to remain at the mercy of unelected policymakers who operate with impunity, insulated from the consequences of their own decisions. When they inflate asset bubbles, it is not their homes that are lost in the crash. When they unleash inflation, it is not their grocery bills that double. When they manipulate interest rates, it is not their small businesses that suffer under the weight of loans that suddenly become impossible to repay. The Federal Reserve does not serve the people—it serves itself, operating beyond the reach of elections, beyond the will of Congress, beyond the grasp of accountability. This is not democracy. This is monetary tyranny.

It is time to reclaim financial sovereignty, to restore accountability to the monetary system, to place the power of the dollar back in the hands of the people. The American worker does not exist to enrich Wall Street. The American economy does not exist to prop up failing megabanks. The Federal Reserve has warped the very purpose of national prosperity, treating the financial sector as an end rather than a means. But the strength of a nation is not measured by stock market gains or the balance sheets of multinational corporations. It is measured by the well-being of its citizens, by the security of their wages, by the affordability of their homes, by the ability of its people to build wealth without seeing it siphoned away by inflation, speculation, and interest rate manipulation.

The Federal Reserve must not simply be reformed; it must be replaced. The time has come for the United States to take command of its own financial destiny by establishing a National Bank of the United States—one that operates in service to the people rather than the financial elite. The modern economy cannot be shackled to a system that profits from debt, manipulates interest rates for the benefit of Wall Street, and inflates speculative bubbles that enrich the few while impoverishing the many. Instead, the nation must turn to a public banking model, one that funds infrastructure, industry, and domestic investment, ensuring that capital flows into the real economy rather than into the pockets of private financiers.

The framework for such a system is already in motion. As outlined in Volume II: The Freedom Economy Plan, the establishment of a public banking system will replace private lending institutions and break the grip of the Federal Reserve’s debt-based model. Through a National Bank, the United States will transition from borrowing at interest to financing its own economic expansion, removing the corrosive influence of financial speculation from monetary policy. No longer will credit creation be dictated by the whims of unelected bankers, but instead be directed toward national priorities—rebuilding infrastructure, expanding manufacturing, and investing in technological innovation that secures American dominance in the industries of the future. This will not be an experiment. It will be a return to the economic sovereignty that once defined this republic, a sovereignty that has been eroded for over a century by a financial system that serves only itself.

The end of unchecked central banking is not the end of stability—it is the beginning of true prosperity. With a public banking system in place, America will no longer be beholden to foreign creditors or private banks to finance its own development. The nation will be free to invest in its people, its industry, and its future without the perpetual weight of interest payments draining wealth into the hands of speculators. This is not just a course correction; it is a revolution in financial sovereignty. The Federal Reserve’s reign is over. A National Bank, accountable to the people and driven by national interest, is the only path forward.. There can be no half-measures. Transparency is not enough. Minor policy adjustments are not enough. The system itself must be uprooted and rebuilt so that it serves the American people, not the financiers who have hijacked it for their own ends. The dollar belongs to the people. Monetary policy must be set in the interest of the nation’s prosperity, not as a tool for asset bubbles, not as a weapon for financial engineering, not as a lever for the wealthiest to consolidate their grip on the economy.

The future of American prosperity depends on it. A sovereign nation does not outsource its financial destiny to a cabal of unelected economists. A sovereign nation does not allow itself to be shackled to debt cycles manufactured by those who will never bear the consequences. A sovereign nation does not surrender control of its own currency to an entity that operates outside the reach of its own citizens. The time has come to reclaim control. The time has come to sever the chains of economic dependence. The time has come to strip the Federal Reserve of its unchecked authority and return financial power to the hands of the people.

The question is not whether reform will come, but whether it will come by choice or by collapse. History is clear—monetary empires that overreach eventually fall, and the warning signs are flashing in bright red. The Federal Reserve cannot continue down this path indefinitely. It can either be restructured and returned to its rightful place as a servant of national economic stability, or it will crumble under the weight of its own excesses, triggering a reckoning far more destructive than any reform could ever be. If America waits until the collapse is upon us, the suffering will be immense, the chaos unavoidable, the rebuilding far more painful than necessary. But if action is taken now, if the grip of central banking is broken before the next crisis strikes, then this nation can chart a new course—one defined not by manipulation and crisis, but by stability, growth, and economic self-determination.

The time to act is now. No more delays. No more waiting for the next collapse to force change upon us. No more pretending that the system can continue as it is without devastating consequences. The choice is simple—either America reclaims control of its own monetary future, or it remains a hostage to the very institution that has profited from its decline. Let those who cling to the old order tremble. Let those who have built their wealth on rigged policies and backroom deals take notice. The people are awake, the system is exposed, and the days of unchecked central banking are numbered.