In a bold move, some members of the Republican Party in the United States have blamed the Federal Reserve for rising inflation and a dollar devaluation. With this in mind, Republican Representative Thomas Massie has proposed dismantling the institution, making it a scapegoat for the country's woes.
Massie has suggested repealing the Federal Reserve Act of 1913 and abolishing the Board of Governors. He argues that the US central bank is to blame for inflation, which has been on the rise since the COVID-19 pandemic. "During COVID, the Federal Reserve created trillions of dollars out of thin air and loaned it to the Treasury Department to enable unprecedented deficit spending. By monetizing the debt, the Federal Reserve devalued the dollar and enabled free money policies that caused the high inflation we see today," the official said.
According to the congressman, Americans’ retirement savings are shrinking because of the Fed's policies that "benefit the wealthy and connected." The bill to abolish the Federal Reserve has been co-sponsored by more than 20 Republican representatives.
Earlier, Fed Chairman Jerome Powell said that it might take longer than previously expected for Fed officials to feel confident enough to cut interest rates. At the same time, he highlighted the Fed's prolonged campaign to snuff out runaway inflation and its efforts to bring it back to the 2% target.