The Senate Awakes

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The New York Sun

The decision of Senator Cornyn to get behind the idea of a Centennial Monetary Commission should put a bit of a spring in the step of the heroic band on the Hill that is nursing the idea of monetary reform. The legislation comes out of the Joint Economic Committee, which is chaired by Congressman Kevin Brady of Texas. The measure has something like 32 sponsors in the House, and they have been hoping for a serious figure to get behind it in the upper chamber. They’ve landed a terrific ally in Mr. Cornyn.

It happens that this newspaper was the first to endorse such a commission, which would undertake take a strategic review of the Federal Reserve as it begins its second century. Given the astonishing role the Fed has played in our national life, not to mention in the economy of the rest of the world, one would think that a centennial review would be a lead pipe cinch. Particularly because there has been such a radical expansion of the Fed’s balance sheet in the current crisis.

Yet the sponsors of the Centennial Monetary Commission have found slow going, not only in the Congress but, save for the Wall Street Journal, in the big newspapers. It seems that the entire liberal establishment is determined to get through this current crisis without seriously exploring the idea of whether monetary policy — and even monetary structure — might be one of the culprits behind the fact that the Great Recession has consumed the first three quarters of the very presidency in which they’d invested so much of their hopes.

What is at the bottom of this blitheness? Is it the vested interest in inflation in a nation whose government owes so much money? Is it the heat that the Fed has taken away from a Congress to which the Constitution grants the enumerated power of coining money and regulating its value? Is it but partisan politics that makes the Democrats so skittish of monetary reform? Is it the failure of Governor Romney, who was given a platform calling for the establishment of a new gold commission, to use the plank in an imaginative and convincing way?

Whatever the worries, the Centennial Monetary Commission ought to be just the ticket. It was conceived by the Joint Economic Committee as what Mr. Brady once called a “brutally bipartisan” effort. It would have a broad brief, looking not only at the gold standard, rules-based policy making, and other issues, but also at the structure of the Federal Reserve. Yet it’s not a project of radicals like, say, the Audit the Fed campaign of Ron Paul, a campaign we also endorsed. It is a project of honest, centrist, constitutionally-mindful reformers. It more than deserves a lively sponsorship in the Senate.


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