The Federal Reserve should be abolished because it inflates the money supply, destroys the purchasing power of our currency, distorts the proper workings of the market economy with boom-and-bust cycles, and allows the federal government to expand without directly taxing the American people.
The inflation and devaluation of the US dollar should be viewed as a hidden tax on the American people rather than a monetary policy. Because people will reject the notion of increasing direct taxes, inflation is then used to help service the overwhelming debts of the United States government by controlling its interest rates and borrowing power. In turn the purchasing power of the masses is diminished, yet most people are unaware. This diminution has the biggest impact on low income individuals since it is a regressive tax. The CPI presently does not include food and energy, yet these are the items on which the majority of peoples’ income is spent.
Prior to 1971, the US dollar was backed by gold. Today, the dollar is backed by 2 things: the government’s ability to generate revenues (via debt or taxes), and its authority to compel economic participants to transact in dollars. It is time we ended this failed monetary experiment and returned the US dollar to the gold standard.