Should The Federal Reserve System's Future Role In Monetary Policy

The Federal Reserve System’s future role in monetary policy is likely to remain similar to the role it has had. This is likely in part because of the eternal nature of the law that President Woodrow Wilson signed that produced the Fed. In the past, this monetary policy included influencing the accessibility and cost of money as well as credit. This allows the Fed to endorse a healthy economy. As a part of this, Congress has two main goals for the Fed to promote such an economy. The first goal is to attain the maximum sustainable output and employment that our nation can handle. The second goal is to keep prices in check in order to ensure that the economy has low, stable inflation. The Fed is able to do these things by implementing monetary

I believe the Fed should make it more difficult for the government to borrow money. In doing so, the Fed would be working against the government’s constant creation of more debt. Over time, this could possibly help to decrease the nation’s debt as a whole. This would be extremely beneficial as the debt of the United States is consistently on the rise. Preventing the government from borrowing money would help the nation’s economy. It would make the economy stronger financially. This would ultimately decrease the amount that the government is able to spend. Decreasing government spending would help the nation’s economy tremendously. Moreover, the Fed should discourage the government from printing additional money. As P.J. O’Rourke famously claimed, “A U.S. dollar is an IOU from the Federal Reserve Bank. It’s a promissory note that doesn’t actually promise anything. It’s not backed by gold or silver.” Money from the United States government no longer maintains the same value and promise that it once did. At the rate that the U.S. is headed, there will come a time at which other countries may not view money from the Fed in a serious or legitimate