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 World Bank President Robert Zoellick has chimed in with his two cents on the Federal Reserve: he opposes giving the Fed more authority, instead proposing to shift authority for oversight to the Treasury Department. He calls for no transparency, though, and certainly no audit.
Zoellick’s argument that he opposes giving more authority to the Federal Reserve seems at first to support the current effort to thoroughly scrutinize and then reduce the power of the Federal Reserve. But when putting his comments under the microscope, a different picture emerges.
In a speech entitled “After the Crisis?” to an audience at the Paul H. Nitze School of Advanced International Studies at Johns Hopkins in D.C., Zoellick bares his real agenda — a new international order. This speech is a precursor to the one he will be presenting in Istanbul, Turkey, at the annual meeting of the World Bank and IMF.
All the classic new world order buzz words and phrases are in use by Zoellick, as he urges a new reshaping through a “multilateral system,” that would forge a “responsible globalization.” A globalization that would encourage balanced global growth and embrace global efforts to counter climate change, of course!
In his speech, along with singing the praises of NAFTA and the “deeper integration of North America,” and his happiness over “open regionalism,” Zoellick says that central banks failed to address “risks building in the new economy”:
They [central banks] seemingly mastered product price inflation in the 1980s, but most decided that asset price bubbles were difficult to identify and to restrain with monetary policy. They argued that damage to the “real economy” of jobs, production, savings, and consumption could be contained once bubbles burst, through aggressive easing of interest rates. They turned out to be wrong.
Regulators and supervisors of financial institutions were no longer grounded in reality. Financial innovation and competition vastly expanded services -- including to companies and families often shunted aside in the past -- but the alluringly simple design of “rational markets” theory led regulators to take a holiday from the realities of psychology, organizational behavior, systemic risks, and the complexities of markets and humans.
Here Zoellick is actually blaming himself.
CFR member Zoellick (Council on Foreign Relations), was executive vice president of Fannie Mae from 1993 to 1997 and served as vice chairman of Goldman Sachs Group, as well as managing director and chairman of Goldman Sachs’ Board of International Advisors and sometimes Senior Advisor to that group. He was in the thick of things as the foundation for the recent crisis was laid. Now Zoellick wants to lecture us as to how to fix the financial time bomb he helped create.
This quote is particularly interesting:
The U.S. Congress was surprised to learn of the scope of the Federal Reserve’s authority to create funds, buy assets, devise global swap lines, and make transactions outside the usual process for expending public monies.
Zoellick is not ignorant of the fact that the American electorate is up in arms over the Federal Reserve and its power. He descries the attitude towards central banks we are now seeing, saying, “In the United States, it will be difficult to vest the independent and powerful technocrats at the Federal Reserve with more authority.” Hence his willingness to transfer more power and authority to the Treasury Department: “The Treasury is an Executive department, and therefore Congress and the public can more directly oversee how it uses any added authority.”
The rest of Zoellick’s speech reads like a globalist’s dream. He speaks of forging a “liberalizing trade agenda,” that goes much further than the Bretton Woods architects who initiated the present global trading system. And he interweaves all the current globalist agenda, from support of global climate change initiatives, and humanitarian work, often used as subterfuge for furthering hidden goals, to “open regionalism,” a “new America,” and a “New Normal” that sees the death of protectionism in any form for any country, together into one new international political economic system.
Zoellick’s goal is to have a hand in controlling every aspect of an operating world system from global finance and currencies, climate change, all trade, all development, and all security issues. Arguing that this new system “cannot be hierarchical, and it should not be bureaucratic,” he nonetheless, in his very next phrase, says this cannot be accomplished but through the most hierarchical and bureaucratic bodies ever devised by man — the IMF, World Bank Group, WTO, Financial Stability Board, and the UN.
Zoellick is no constitutionalist, but rather the consummate Insider’s insider.
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