The Instigator
AlextheYounga
Pro (for)
Tied
0 Points
The Contender
nickgb
Con (against)
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0 Points

Should the Federal Reserve be Abolished?

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Voting Style: Open Point System: 7 Point
Started: 5/23/2012 Category: Economics
Updated: 4 years ago Status: Post Voting Period
Viewed: 1,771 times Debate No: 23800
Debate Rounds (5)
Comments (16)
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AlextheYounga

Pro

Let's see if I can get another good debate out of this one.

My points on abolishing the Fed.


    • It acts as a cartelization device.
    • It destabilizes the economy
    • It counterfeits money
    • It causes monetary inflation
    • It causes our most unfair tax (inflation)
    • It unevenly redistributes wealth in the economy.


First round acceptance.
nickgb

Con

First off, without you having really elaborated on some of your points, I will ignore them for the time being. For example, the Fed being a "cartelization device" is incredibly ambiguous (and not factual, for that matter) and vague without any clarification on your part. With that being said, to address your relevant points:

"It destabilizes the economy"

This is patently false. Any examination of history or the evidence will clearly show that the Federal Reserve actually stabilizes the economy, which is in essence its entire job in regulating monetary policy. The Federal Reserve acts as a safeguard against bank "panics" in which consumers flock to banks in order to withdraw what holdings they have (generally in times of economic decline), often quickly depleting the bank's reserves and making them unable to meet withdrawal demands. The Reserve prevents this from happening by regulating the required deposit (or the amount of money a bank must keep on hand from deposits) and providing emergency funds in the event of a panic.

The Fed also regulates the money supply in times of shiftiness (holidays, for example) to ensure that it maintains consistent and to avoid rampant inflation or deflation.
(http://upload.wikimedia.org...) - proof of consistency

In 2008, while one might disagree with the philosophical ramifications of its actions, the Fed was key in stabilizing the economy, loaning AIG in excess of $80 billion dollars, arguably preventing a further decline in the economy.

Lastly, there's no denying the Federal Reserve has a huge impact on the economy. When Bernanke announces a Fed policy, it often leads to massive drops in global stock markets or global increases, depending on what is announced. But Bernanke is an expert in his field who is extremely educated - as is the entire Board. They are appointed by political figures but, afterwards, cannot be removed via political means and generally are free from the political arena. This means that the great power wielded by the Federal Reserve - a necessary power in regulating monetary policy - is relatively stable, unlike what it would be if it were subject to the ups and downs of democracy/partisan politics. Without politics involved, the massive rises/falls of the stock market that occur due to the Fed are limited, whereas there would be absolutely no stability if it were controlled by public opinion.

"It counterfeits money"

This is by definition not true. As defined by Merriam-Webster, a counterfeit is something made in imitation in order to deceive. The money printed by the Fed isn't an imitation, it has real value and real impacts. Just because you disagree with their policies does not mean their money is not valid.

"It causes monetary inflation"

This is somewhat true and somewhat false. The Fed engages in expansionary and contractionary policies, each designed to increase/decrease the supply of money. The latter is meant to decrease inflation and generally succeeds in doing such. In times of economic recession, the Fed may drastically attempt to increase the money supply/credit flow (as it is now), but the actual increase in inflation generally is minimal and claims that the Fed leads to massive increases in inflation are unwarranted. Moreover, the actual economic benefits of these policies in boosting economic growth have been ignored by my opponent.

"It causes our most unfair tax (inflation)"

Redundant and debunked largely above.

"It unevenly redistributes wealth in the economy."

I would like to see evidence of this, and on top of that, would like you to prove why that's a bad thing. Redistribution isn't necessarily a bad thing even if done unevenly, and you have the burden of proof here with your claim.

I'd like to state that the Fed should not be abolished for a variety of reasons.

1. As outlined above, it stabilizes the economy. Through expansionary and contractionary policies, the Federal Reserve limits the money supply in both directions, avoiding rampant inflation/deflation and generally keeping prices relatively stable. While inflation has been an issue - though minor - in the past for the United States, it generally doesn't last for a long period of time and real wages for the most part increase with it. Especially when compared to other countries, inflation is a non-issue for American citizens.

Additionally, the Federal Reserve acts as a safeguard against public opinion dictating monetary policy or massive panics that bankrupt the financial industry. Both of these points have been explained in my refutation of my opponent's claims.

2. The Federal Reserve is an ideal system. Much like democracy, the Fed isn't perfect, and it certainly has its flaws - but in regulating monetary policy, it's proved to be largely a success. There have been no instances where Federal Reserve policy has been directly disastrous, and the relative stability/regulation it provides far beats most other monetary systems in our country's history. Since the implementation of the Fed, as well as the changes it faced after the Great Depression, recessions/panics have been far less severe than before. And, in 2010, the Fed posted a profit of $82 billion - far from "counterfeit" as my opponent claimed.
Source: http://www.nytimes.com...
Debate Round No. 1
AlextheYounga

Pro

I did not elaborate because it was just showing where I stood. The first round acceptance just means that you were supposed to say "I accept" and then I would elaborate, but it doesn't matter, its almost a traditional thing on this site.

Cartelization
Well, I know saying the Fed is a cartelization device does sound a little far fetched, but I'll explain why. Don't jump to conclusions.
A cartel is a group of independently owned businesses which come together for the purpose of reducing or eliminating competition between themselves to enhance their profit margin or to secure their positions in the market.

And I will add as a side note that the creation of the Federal Reserve is a very interesting story. Its creation has something to do with it being a cartelization device. In 1910, seven men went to Jekyll Island, Georgia (I live near there, its a very beautiful island, haha.) I don't want to go into full detail just yet because its a long story (I will if necessary though) but I'll just say that these seven men had very close relations with the Rockefeller's, J.P. Morgan, the Rothchilds, and the Warburg. These were the wealthiest people in the world (1/4 of the entire world's wealth) at the time and they all had affiliations with banks, especially J.P. Morgan, and were the main people involved in the money trust.
These people wrote the Federal Reserve Act (in secret) and it was proposed at first by Senator Nelson Aldrich. (Aldrich Plan) A note about Senator Aldrich is that the public knew he had close affiliations with the people of the money trust. (He was the father-in-law to John D Rockefeller.) The bill did not pass at first for this reason.
The bill was then later proposed by two other senators named Robert Owen and Carter Glass. Their names on the bill made the bill totally acceptable.

There is one quick comparison that anyone can make with any of these people I named above (Rockefeller, Rothchilds, Warburg's, Morgan) that anyone can easily spot. They were all competitors. These people created the Federal Reserve to eliminate competition of banking in the market. The money trust wrote the bill that tried eliminating the money trust.

The Federal Reserve eliminates competition of banking. Before the Fed, America operated on free enterprise banking (which contrary to popular belief, actually was doing quite well.) These people hated competition. "Competition is a sin" John D Rockefeller
Now let me note that the Federal Reserve is not a federal agency. The word federal is just there to make it seem like it is. It is partly controlled by the banks, and partly controlled by the government. Cartels often do this to enforce their rules.

I will explain more on this later, I'm running out of characters and I need to explain more.

Legalized Counterfeiting
"counterfeit is something made in imitation in order to deceive."
That's exactly what counterfeiting is and that's exactly what the Fed does.
"The money printed by the Fed isn't an imitation, it has real value and real impacts."
Exactly. Isn't it also true that counterfeit money has an effect on the economy? Isn't it also true that counterfeited money has exactly the same monetary value as any old other dollar?

"The U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes." So spoke Federal Reserve Governor Benjamin Bernanke in 2002, prior to becoming the central bank's presiding chairman during the credit crisis and stock market crash of 2008.

This is how the Fed counterfeits money. The Federal Reserve can create money from pretty much anything (It wasn't always like this, the Federal Reserve Act has been amended 199 times.) The Fed can either buy up its own debt (so basically most of our dollars our backed by debt), or it can buy assets in any business it wants to. (note that the Fed's powers have become so broad that they can even use the debts of other countries)
In the beggining, the Fed proposed that all of the new money that was to be created, would be redeemable. This changed over time to just creating it out of thin air. So whenever the government needs more money, they just print whatever they need. Haha, this is counterfeiting!!

Uneven Redistribution of Wealth
One thing that is true of every counterfeiter, is that the counterfeiter always receives this new money first. Then the rest of the money gets rippled down into the economy until it eventually reaches the poor. This benefits some (the richer) and hurts others.

And this counterfeiting has a serious effect on the economy.

Inflation
People always ask "What is the optimal quantity of money?" "How much total money should we have at a present time?" "How fast should the total grow?" Once you analyze these questions, you realize how absurd the question really is. Why don't we address the questions of "What is the optimal supply of canned peaches, or Nintendo games, or canned peaches?" The reason is because all resources are scarce in relation to human wants; if a good were not scarce, it would be superabundant, and therefore priced like air, at zero on the market.
But the question of an optimal supply of money arises because of inflation. The real "optimal supply of money" is the supply that occurs in the free market. All money arises from the free market. It at first started with a bartering system, and then over time turned into a general currency because of large businesses. After a currency is placed into the market, it is at its "optimal supply"
Inflation has no social benefit in an economy. Increasing the supply of money cannot relieve the natural scarcity of consumer or capital goods. All it does is make the dollar cheaper and dilutes the currency.
Another thing, is that low prices do not cause recessions. Prices become cheaper naturally and this is very beneficial in an economy.


Inflation is a Tax
I'm just going to give you a brief overview and my friend Ron Paul is going to help me out a little. And Bernanke can help too. Yeah, Bernanke is a smart guy, so this should affect your perspective a little bit.


As I explained before, the counterfeiter benefits first from creating the new money. When the Fed increases the money supply, the prices on goods begin to go up (note that real price of the good doesn't really change because it is still being produced the same way, just the increase in the money supply causes the price to go up) But, because the people who have not received this new money (the uneven redistribution of wealth) find that the prices on the goods that they buy have gone up, while their own incomes have not risen. The government has received the purchasing power from the people and it is a regressive tax on the poor. The counterfeiter's gain is the greatest.




Basically all of what I have explained, destabilizes the economy. Especially inflation. The Federal Reserve does not stabilize the economy. It has never done so. Take a look at all the recessions and depressions that have occurred after the Fed's creation. The Fed hasn't stopped anything and is incapable of doing so because inflation does not benefit the economy.




Sources
http://en.wikipedia.org...
http://www.bigeye.com...
http://en.wikipedia.org...



nickgb

Con

Yeah, that's my bad, like I said in the comments. Sorry about that.

With regards to your point on "cartelization", I have to question a few things. First off, most of what you're providing here is not entirely true. The Aldrich plan was not actually passed; rather, it served as a foundation for the Federal Reserve Act but the two are not synonymous and cannot be used interchangeably. There are notable differences, specifically regarding the government's role in running the Federal Reserve and its freedom from Wall Street.

Either way, I argue the point is moot. You have not shown how it decreases competition or eliminates it, merely claimed that was the intent of its founders (which is not true). Even if that were the case, you have yet to provide why the elimination of competition is necessarily a bad thing and, moreover, how the Federal Reserve actually eliminates competition today.

Counterfeiting
You agree with my definition that counterfeit is an imitation meant to deceive. This means that what is created is a fake, an imitation of whatever it is trying to impersonate. When the Federal Reserve or the Treasury Department prints money, they are the real deal. They aren't deceiving and they are not imitations. They hold real value in the market and influence the value of the currency. Counterfeit dollars DO NOT have the exact same monetary value as "any old other dollar" - they have no value, and only gain value by pretending to be what they are not. So again, the Federal Reserve does not counterfeit anything - the dollars it use have real value and are not imitations.

Secondly, I would like to clarify that the Federal Reserve does not actually even print money. As this article (http://www.mecpoc.org...) explains, the Federal Reserve does not actually really add money directly and it certainly does not print money. This too counters your point regarding alleged counterfeit.

The rest of your allegations, that the Fed can just create money out of thin air or buy any assets it wishes to, are false. Under the Federal Reserve Act, the Federal Reserve may NOT buy debt/shares in businesses outright without Congressional approval, which is rarely if ever given.
(http://ftalphaville.ft.com...)

Wealth
Again, this is conjecture. You have not provided any evidence of your claims here and the Fed's policies revolve around monetary policy, not directly giving money to any specific income group or businesses.

Inflation
First off, you have wrongly claimed that inflation has no economic benefits. This is simply not true. In calculating the GDP, exports-imports is considered. Higher inflation/lower value of the dollar makes American goods cheaper overseas, leading to increased exports and an increased GDP growth.

Additionally, you have yet to show how the Fed actually increases inflation. You've merely advocated for a free market system, not showing any warrants to how that would in any decrease inflation or how the Fed increases inflation. If one views history, since the passage of the Federal Reserve Act, inflation has actually been drastically lower.
(http://upload.wikimedia.org...)

Tax
The issue with your claim is that you claim real income does not raise when inflation/money supply rises. Again, history and some evidence will disprove you. Take a look at this graph:
http://upload.wikimedia.org...

Real income for all races, taken via an average, show that since 1965 real median income has risen by nearly $10,000. Certainly the notion that it remains stagnant under the Federal Reserve system is false. Moreover, you've ignored what I said with regards to the Fed using both expansionary and contractionary policy. The Federal Reserve does NOT always increase money supply; rather, when inflation becomes problematic, they use contractionary policy and decrease the money supply. This can in part explain the lower rates of inflation that we've had under the Federal Reserve system as shown by my graph above.

Lastly, your claim with regard to stabilization/destabilization isn't true, and I already outlined this in my statements during Round 1. Additionally, to reiterate what I said during Round 1 - and you have yet to address - the Federal Reserve is a better system to any alternative proposed/implemented, and evidence would show that the Federal Reserve does, in fact, stabilize the economy.
Debate Round No. 2
AlextheYounga

Pro

Okay, as I do not wish to insult you, your understanding of the Federal Reserve is wrong. Also you did not read everything I wrote (which I can understand reading these walls of text can be a hassle.)
Let me explain.

Cartelization Cont.
"First off, most of what you're providing here is not entirely true. The Aldrich plan was not actually passed; rather, it served as a foundation for the Federal Reserve Act but the two are not synonymous and cannot be used interchangeably."

Haha, I know, I actually explained this above.
...it was proposed at first by Senator Nelson Aldrich. (Aldrich Plan) A note about Senator Aldrich is that the public knew he had close affiliations with the people of the money trust. (He was the father-in-law to John D Rockefeller.) The bill did not pass at first for this reason.
The bill was then later proposed by two other senators named Robert Owen and Carter Glass. Their names on the bill made the bill totally acceptable.

It was the same exact bill. It just didn't have Aldrich's name on it, which made it easier to pass in Congress.

I'll explain it in more detail to make it a little bit more understandable.
The people present on Jekyll Island were:
Nelson Aldrich
(already described above.)
Abraham Andrew-
Assistant Secretary of the Treasury, who later became a Congressman. He was very prominent in banking circles.
Frank Vanderlip- President of the National City Bank of New York, the largest and most powerful of all the banks in the country. He represented the financial interests of
Henry Davison- Senior partner of the J.P. Morgan company.
Charles D. Nortan- President of the First National Bank of New York.
Benjamin Strong- The head of J.P. Morgan's Trust Company, and 3 years later after the Federal Reserve System was created, he became the head of the system.
Parl Warburg- (probably the most important there because of his European banking knowledge) He was born in Germany and eventually became an American citizen. He was a partner in Kuhn, Loeb & Co. and was a representative of the Rothchilds Dynasty in England and France.

This is a quote from Frank Vanderlip out of the Saturday Evening Post
"I do not feel it is any exaggeration to speak of our secret expedition to Jekyll Island as the occasion of the actual conception of what eventually became the Federal Reserve System. We were told to leave our last names behind us. We were told further that we should avoid dining together on the night of our departure. We were instructed to come one at a time and as unobtrusively as possible to the railroad terminal on the New Jersey littoral of the Hudson where Senator Aldrich's private car would be in readiness attached to the rear-end of a train to the south. Once aboard the private car we began to observe the taboo that had been fixed on last names. We addressed one another as Ben, Paul, Nelson and Abe. Davison and I adopted even deeper disguises abandoning our first names. On the theory that we were always right, he became Wilbur and I became Orville after those two aviation pioneers the Wright brothers. The servants and train crew may have known the identities of one or two of us, but they did not know all and it was the names of all printed together that would've made our mysterious journey significant in Washington, in Wall Street, even in London. Discovery we knew simply must not happen."

This did happen and its all documented history.

Now how the Federal Reserve eliminates competition.
The Federal Reserve can choose to funnel money into the banks if it wishes. It is also able to regulate interest rates which eliminates free market enterprise. When you no longer have the ability to control your own business, its not a free market. This eliminates competition of banks. They are no longer able to compete and all banks are basically the same. Competition on the market has always shown throughout history to be very beneficial in an economy. Free market competition lowers prices and allows goods to be affordable to the public to keep a place in the market.

It acts as a cartelization device because it allows the big banks to stay in business. It is impossible for them to go out of business because the Fed or the FDIC will bail them out.

Counterfeiting and How it is Deceiving
I did explain it above but I probably should have pointed it out a little better so I'll say its my fault. And the funny thing is that our government does it everyday. And yes, it is deceiving, because its a tax and also because the people do not have a good understanding of government and the Fed. People believe these dollar bills are just any old dollar bill. Its money that comes from nothing.

Yes it does come from nothing.
As I explained before, their powers have become so broad that they can create money from anything it wants to. And I do realize that the Fed does not print money. It orders for money to be printed (same difference)
By the way, the website you provided also does not have the correct understanding of the Federal Reserve. (Again, understandable, its meant to be deceiving.)
Note that the way the Fed is designed does not make sense. Its not really supposed to make sense.
But let me explain lol
The Federal Reserve increases the reserves of the banks (also a factor in cartelization) under its jurisdiction by buying assets. It doesn't matter whom the Fed buys it from, whether its from the banks or from any individual or firm in the economy. Now, suppose a central bank buys an asset from a bank. For example, the Central Bank buys a building, owned by...idk Alexville Bank for 1,000,000. The building appraised at 1,000,000 is transferred from the Alexville asset to the Central Bank's asset. How does the Central Bank pay for the building? By simply writing out a check on itself for 1,000,000. Where did it get the money to write out the check? They just created it out of thin air i.e., by creating a fake warehouse receipt for 1,000,000 in cash which it does not possess. The Alexville bank deposits the check at the Central Bank, and the Alexville Bank deposit account at the Central Bank goes up by 1,000,000. The Alexville Bank's total reserves has increased by 1,000,000, upon which it and other banks will be able, in a short period of time, to multiply their own warehouse receipts to non-existent reserves manyfold, and thereby increase the total supply of the country manyfold.

And I provided, in pretty good detail how the tax effects the poor. And about inflation.
"In calculating the GDP, exports-imports is considered. Higher inflation/lower value of the dollar makes American goods cheaper overseas, leading to increased exports and an increased GDP growth."
But then look at the opposite. We are not able to buy as many things. Plus look at the big picture. Prices rise and people are unable to buy goods. Exports overseas are not very beneficial since America mostly import products anyway. So again, your net value is negative.

Also your graph proves my point. Income has increased because the supply of money has increased overtime. That's how inflation works. People have more money, but their purchasing power is taken away.

My points of the Federal Reserve destabilizing the economy are still true. My opponent has not given an example of the Federal Reserve preventing the many economic recessions and depressions we have had. My points have not been rebutted.




nickgb

Con

nickgb forfeited this round.
Debate Round No. 3
AlextheYounga

Pro

Its fine if you weren't able to post your argument. We still have one round left.

I'm just going to go over my main points again.
  • The Federal Reserve acts as a cartelization device.
The Federal Reserve eliminates the competition of banks by controlling the interest rates of banks and by funneling money into the banks to keep them from going under.
Also, the Federal Reserve was created to be a cartelization device by wealthy bankers and individuals involved in banking. The people who created the Federal Reserve Act were Nelson Aldrich, Abraham Andrew, Frank Vanderlip, Henry Davison, Charles D. Nortan, Benjamin Strong, and Paul Warburg. These individuals were either backed by J.P. Morgan, John D. Rockefeller, the Rothchilds Dynasty, or the Warburgs. These were the wealthiest people in the world and were all competitors. The only reason they would want to create a central bank would be to eliminate competition and establish a better place for themselves on the market. The definition of a cartel.
  • The Federal Reserve causes inflation

The Federal Reserve causes inflation which has a negative effect on the economy because it dilutes the value of the dollar and creates higher prices. Inflation has no social benefit. The quantity of the currency should never be changed once established on the market. That is its "optimal quantity" of money. In general economic theory, the invariable result of an increase in the supply of a good is to lower its price. For all products except money, such an increase is socially beneficial, since it means that production and living standards have increased in response to consumer demand. If steel or bread or houses are more plentiful and cheaper than before, everyone's standard of living benefits increase. But an increase of the supply of money cannot relieve the natural scarcity of consumer or capital goods; all it does is dilute the value of the dollar and lower its purchasing power.

  • The Federal Reserve counterfeits money.

Government is a "monopoly on force." The government monopolizes the country, and then makes you abide by its rules. No individual can counterfeit money, but the government can just by calling it a different name. The Federal Reserve creates money out of thin air by buying up its own debt or buying assets. Or even buying up debt of other countries. Basically, whatever it wants to do. The Federal Reserve has a great deal of independence from Congress because the Federal Reserve makes "unpopular decisions" The Federal Reserve creates money from nothing, and then increases the total supply of money. It also can give it to banks and then let the banks charge interest on this new money. So the banks are able to charge interest on money that comes from completely nothing. This is illegal, but they do it anyway, because the government wants their money.

  • The Federal Reserve causes our most unfair tax, inflation.

As my good friend Ron Paul explained (with Bernanke's much needed help) inflation is a tax. It is a regressive tax. It is an unfair tax. The Federal Reserve counterfeits money. A counterfeiter always has the benefit of having these new dollars first. This counterfeited money ripples down the economy starting from rich and ending before it even gets to the poor. Low income individuals have the burden of higher prices, without an increase in their income. This is a tax. An unfair tax.

  • The Federal Reserve unevenly distributes wealth in the economy.

As I explained above, the new counterfeited dollars ripple down the economy and benefit the rich, while hurting the poor. Low income individuals have the burden of higher prices, without an increase in their income. This is a tax. An unfair tax.

nickgb

Con

nickgb forfeited this round.
Debate Round No. 4
AlextheYounga

Pro

It disheartens me to see that Con could not finish all of the argument. I understand if he does not have time to debate. Everyone's schedule nowadays is crazy. Since its my last argument, I will repost all of my main arguments.

  • The Federal Reserve acts as a cartelization device.
The Federal Reserve eliminates the competition of banks by controlling the interest rates of banks and by funneling money into the banks to keep them from going under. Competition of banks and all businesses for that matter, are healthy in an economy because it lowers prices and increases purchasing power.
Also, the Federal Reserve was created to be a cartelization device by wealthy bankers and individuals involved in banking. The people who created the Federal Reserve Act were Nelson Aldrich, Abraham Andrew, Frank Vanderlip, Henry Davison,Charles D. Nortan, Benjamin Strong, and Paul Warburg. These individuals were either backed by J.P. Morgan, John D. Rockefeller, the Rothchilds Dynasty, or the Warburgs. These were the wealthiest people in the world and were all competitors. The only reason they would want to create a central bank would be to eliminate competition and establish a better place for themselves on the market. The definition of a cartel.

Quote from Frank Vanderlip in the Saturday Evening Post
"I do not feel it is any exaggeration to speak of our secret expedition to Jekyll Island as the occasion of the actual conception of what eventually became the Federal Reserve System. We were told to leave our last names behind us. We were told further that we should avoid dining together on the night of our departure. We were instructed to come one at a time and as unobtrusively as possible to the railroad terminal on the New Jersey littoral of the Hudson where Senator Aldrich's private car would be in readiness attached to the rear-end of a train to the south. Once aboard the private car we began to observe the taboo that had been fixed on last names. We addressed one another as Ben, Paul, Nelson and Abe. Davison and I adopted even deeper disguises abandoning our first names. On the theory that we were always right, he became Wilbur and I became Orville after those two aviation pioneers the Wright brothers. The servants and train crew may have known the identities of one or two of us, but they did not know all and it was the names of all printed together that would've made our mysterious journey significant in Washington, in Wall Street, even in London. Discovery we knew simply must not happen."

http://en.wikipedia.org...
http://en.wikipedia.org...
http://en.wikipedia.org...
http://en.wikipedia.org...
http://en.wikipedia.org...
http://en.wikipedia.org...
http://en.wikipedia.org...
  • The Federal Reserve causes inflation

The Federal Reserve causes inflation which has a negative effect on the economy because it dilutes the value of the dollar and creates higher prices. Inflation has no social benefit. The quantity of the currency should never be changed once established on the market. That is its "optimal quantity" of money. In general economic theory, the invariable result of an increase in the supply of a good is to lower its price. For all products except money, such an increase is socially beneficial, since it means that production and living standards have increased in response to consumer demand. If steel or bread or houses are more plentiful and cheaper than before, everyone's standard of living benefits increase. But an increase of the supply of money cannot relieve the natural scarcity of consumer or capital goods; all it does is dilute the value of the dollar and lower its purchasing power.
http://www.silvermonthly.com...

  • The Federal Reserve counterfeits money.

Government is a "monopoly on force." The government monopolizes the country, and then makes you abide by its rules. No individual can counterfeit money, but the government can just by calling it a different name. The Federal Reserve creates money out of thin air by buying up its own debt or buying assets. Or even buying up debt of other countries. Basically, whatever it wants to do. The Federal Reserve has a great deal of independence from Congress because the Federal Reserve makes "unpopular decisions" The Federal Reserve creates money from nothing, and then increases the total supply of money. It also can give it to banks and then let the banks charge interest on this new money. So the banks are able to charge interest on money that comes from completely nothing. This is illegal, but they do it anyway, because the government wants their money. Since 1913 inflation has increased 2217.1% Inflation does not happen naturally, it only happens when the supply of money has been increased. Overtime in a normal economy, deflation should occur due to competition.
http://www.usinflationcalculator.com...

  • The Federal Reserve causes our most unfair tax, inflation.

As my good friend Ron Paul explained (with Bernanke's much needed help) inflation is a tax. It is a regressive tax. It is an unfair tax. The Federal Reserve counterfeits money. A counterfeiter always has the benefit of having these new dollars first. This counterfeited money ripples down the economy starting from rich and ending before it even gets to the poor. Low income individuals have the burden of higher prices, without an increase in their income. This is a tax. An unfair tax.

  • The Federal Reserve unevenly distributes wealth in the economy.

As I explained above, the new counterfeited dollars ripple down the economy and benefit the rich, while hurting the poor. Low income individuals have the burden of higher prices, without an increase in their income. This is a tax. An unfair tax.


My opponent has failed to disprove any of my main points. All of the above contributes to the destabilization of the economy. The Federal Reserve does not stabilize the economy and frankly, is incapable of doing so.
Because of this, I urge a Pro vote.
nickgb

Con

nickgb forfeited this round.
Debate Round No. 5
16 comments have been posted on this debate. Showing 1 through 10 records.
Posted by AlextheYounga 4 years ago
AlextheYounga
And with the Frank Vanderlip one, it was supposed to say he represented William Rockefeller and Kuhn, Loeb & Co.
Posted by AlextheYounga 4 years ago
AlextheYounga
Oh and sometimes the bold can mess up. The 7 people attending all were supposed to be in bold.
Posted by AlextheYounga 4 years ago
AlextheYounga
Thats completely fine. I hope you do well in your debate. :)
Posted by nickgb 4 years ago
nickgb
Thanks for the compliment. It's going to be a little while before I get a chance to respond to this round, sorry - I have a real life debate this weekend won't have a lot of access. I will try to get it done by Saturday, though.
Posted by AlextheYounga 4 years ago
AlextheYounga
Uuum, I actually think that Con has been very reasonable. I'm the Pro and don't think conduct points should be counted off. I thank con for this. :)
Posted by nickgb 4 years ago
nickgb
Also, if it's about my argument in Round 1, that was a noobie mistake. Again, I'm really sorry for having started early and didn't realize that I was only meant to accept in the initial round.
Posted by nickgb 4 years ago
nickgb
Can I ask why? I'm pretty assertive and can come off as harsh generally when I debate, but I fail to see where I violated decorum or was insulting at all, beyond claiming things he said were false or that he didn't provide evidence.
Posted by Ron-Paul 4 years ago
Ron-Paul
-1 conduct for con.
Posted by nickgb 4 years ago
nickgb
It is indeed a great show. I'm upset they split S5 into two separate seasons, though.
Posted by AlextheYounga 4 years ago
AlextheYounga
Wow, I just noticed I used "canned peaches" twice. My bad, I was running out of random things. I think I was really wanting to say women's shoes. Hahahaha
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