The Federal Reserve Should Be abolished:
Debate Rounds (5)
I caution you before reading, my debate style is a bit unorthodox. I have a very minimalist approach and choose to make my statements short and coherent. I only say this because I've been criticized before. I have chosen to address my opponent's arguments before presenting my own. I will be using my opponent's own numerical system for organization.
Response to Reason 1: "The Federal Reserve violates the constitution"
As The Fed does not print (coin) money, The Fed does not violate the constitution.
Here is my .gov source: http://www.federalreserve.gov...
Here is some pleasure reading: http://finance.yahoo.com...
Response to Reason 2: "The Federal Reserve violates the Sherman Antitrust Act"
The Fed's monopoly on the "money supply" as you call it (while it is truly not as tangible of an idea). Is where its power comes from. Without this "monopoly", The Fed becomes irrelevant. Which is why when the Federal Reserve Act was passed, and the Federal Reserve was established, the Sherman Antitrust act was essentially ignored. The fact that The Fed has control over the United States money is no reason for it to be abolished, as that was its intention. Congress already made there decision, and the Sherman Antitrust act has no power over The Fed. Also, money is technically not trade or commerce by the definition of the words trade and commerce, making the all statements in your paragraphs for reason 2 null and void.
You also wrote this in reason 2...
"The Federal Reserve has injured the American people in both their property and their businesses, it has injured their property by instituting inflation and devaluing their money. It has injured their businesses by causing a number of disastrous fiscal policies beneficial only to the big banks; disastrous to the American public."
Until this is somehow cited or proven I have no reason to take this seriously, and this statement should be considered invalid, your argument is considered null and void.
Response to Reason 3: "It undermines our Free Market system"
You state this:
"The Federal Reserve violates this set up because the prices of commodities and the supply of money are controlled by the Federal Reserve, not by the markets. This undermines the entire capitalist system; according to Adam Smith, producers are capable of choosing the price for their own commodities, instead, this power is given to a group of unelected bankers who have government power. "
The Fed does not control the prices of any commodities directly. This is just a basic fact so I'm not going to waste my time citing a source. However, if you have found any information suggesting this is true, this argument is invalid until you cite such information. The rest of your support of reason 3 hinges on this farce that The Fed controls "prices for commodities" so I rest my case here, unless of course, you can cite some specific instances. Your argument is considered null and void.
Response to Reason 4: "It is privately owned and works for the interest of the big money and the banks"
The Fed gives a huge portion (close to 95%) of its profits to the U.S. Treasury. Its interests lie with the interest of our nation's financial security.
Just because The Fed is independent, doesn't mean it's not providing federal services, and this source nullifies your statements.
Response to Reason 5: "The Federal Reserve's inflation policies hurt the working class the most"
After reading this, I merely extend my arguments from my response to Reason 1. Unless you provide a valid reason The Fed causes inflation, I have no reason to address this, and your argument is considered null and void.
Response to Reason 6: "The Federal Reserve is dishonest"
And why does that mean The Federal Reserve should be abolished? Show me the investigation and reports on this and I will take it seriously. Until you do so, I won't take your word for it, and your argument is considered null and void.
Response to Reason 7: "the Federal Reserve"s fiscal policies for economic growth are total quackery"
"According to the Federal Reserve, to spur economic growth, inflation should be at 2%, inflation rates should be low, big businesses should have tax cuts, low interest loans, and free money in the case of an economic crisis."
Where do you see that The Fed supports "tax cuts, low interest loans, and free money?" Until you show me, null and void. As for the rest of this section you appear to debate against "trickle-down economics" instead of The Fed, I wont be addressing any of it, it's a waste of my time.
Response to Reason 8: "The Federal Reserve Board of Dictators and the Governors of the 12 Regional Banks are non-elected"
The Fed is technically independent, it doesn't have to elect anyone. This argument is null and void.
Response to Reason 9: "The Federal Reserve has caused economic turmoil"
The frequency of recessions has been drastically decreased since the implementation of the fed in 1913, and as far as I'm aware, nothing has "collapsed on itself." The Federal Reserve was implemented after the great depression, so how did it cause it? It didn't, plain and fact.
Research supporting The Fed: http://www.frbsf.org...
If you're complaining saying, well I did cite stuff, but he keeps ignoring my citations, saying that my arguments are null and void! That's because not a single one of your citations support your argument. I will leave that to judges to decide, but it is quite apparent that all of your big quote bubbles and fluff truly don't support any of your statements in a rational manner. Your "research" most likely wasn't very thorough, and appears to be centered on propaganda rather than fact from an outsider's perspective. All in all, you have not shown in any coherent way that The Fed should be abolished based on what you have written so far.
This concludes my response section.
My main argument that The Fed should not be abolished will be concise and simplistic. The main reason the Fed should not be abolished, is that The Fed is our main supporter of economic stability nowadays. It protects against depressions and promotes economic growth solely through the control of interest rates. If The Fed were to be abolished, the United States would have no way to prevent national banking disasters that effect the entire world. The following is reading on how The Fed protects our nation.
Link 1: http://www.investopedia.com...
Link 2: http://www.nytimes.com...
Link 3: https://www.federalreserve.gov...
Link 4: http://money.howstuffworks.com...
Link 5: http://www.cnbc.com...
All of this reading supports my argument stated above. I feel no need to add additional arguments on why The Fed should not be abolished at this point in the debate, as my current argument is essentially the main idea behind The Fed.
Thank you for reading. I look forward to round 2.
Response to Reason 1:
You state in this reason, that the Fed has power over the Bureau of Printing and Engraving. The Fed is a national bank. One of the major points of the Fed's creation was to establish nationwide currency; Federal Reserve notes (AKA the US dollar). Within the Federal Reserve Act of 1913, the Fed was given to power to provide a nationwide currency, which was printed by the Bureau of Printing and Engraving, and given back to the Fed for it to distribute. The Bureau issues the money, not the Fed, therefore again nullifying the argument that the Fed is unconstitutional. The Fed is merely a distributor. Is this a loophole in the constitution? Of course. Does this disprove your argument permanently? Very much so.
Response to Reason 2:
Your statement: "the Federal Reserve's purpose was to establish financial stability as well as provide a safe currency for public use, if this was its goal, it has utterly failed and leaving monkey in charge of our money would be less disastrous."
Please Harry, SHOW ME how they failed. Don't just say this. Until you back up this claim, that statement is an opinion and should be disregarded. Besides that point, I extend the argument that the frequency of recessions has had a drastic decrease since the Federal Reserve Act's implementation.
Your second paragraph of this reason is also clearly an opinion, and even if your statements that we do not need the Federal Reserve to control the United States' money supply in order to have financial stability were true, it doesn't provide a reason for the Fed to be abolished.
In response to paragraph 3, I extend this argument of mine, "money is technically not trade or commerce by the definition of the words trade and commerce, making the all statements in your paragraphs for reason 2 null and void."
Paragraph 5: Prove this inflation is a bad thing, and prove that the Federal Reserve is the sole cause of this inflation. You cited a calculator, this doesn't prove your point.
Paragraph 6: Before I acknowledge anything here I would like to apologize for stating in my first round that the Great Depression occurred before the Fed's implementation. I was deep in my reading and I mixed up some numbers.
With that out of the way I will address this paragraph. All of your information is correct. Before the Great Depression the Fed made some mistakes, which inevitably was a factor in economic downfall. This is why today the Fed's chairmen check economic statistics every 30 minutes all the time, and every 15 minutes during economic downturn, making the system much more responsive and effective. The problem has been remedied. Past mistakes are no reason for present abolishment.
Response to Reason 3:
So, because you admit that the Fed does not control any prices in our free market, you also admit that it doesn't undermine the free market system. The Fed doesn't tell you what to buy and when to buy it, they don't alter the free market in any way.
Response to Reason 4:
The reason that Class A directors are chose by commercial banks is because all banks link back to Fed, and monitoring at every level of banking is necessary for the Fed to do its job.
I'm also about to drop a little bombshell for you here, believe it or not, banking is a business. Banks make profit. If we shut down banks for practicing business, our economy would crumble as nobody would have access to tools and utilities that banks provide to help them get out of financial turmoil such as loans. More the reason the Fed shouldn't be abolished, the people are incompetent with there funds, as the video you provided teases at immensely.
Response to Reason 5:
The middle class is declining simply because people just aren't unionizing anymore. People are no longer fighting for better wages, they've slunk back like the cowardly animals they are to big business. Inflation may be partially responsible, but the people are really to blame. Abolishing the Fed will throw the economy into a vicious downward cycle of non-recoverable depression, the inflation is a small price to pay, and the people can fight against inflation and deal with it, they simply won't.
Response to Reason 6:
So, because our government is relatively dishonest with the people this means we need to abolish a tool still providing stability? No sir, it just isn't practical. Politicians aren't going to be honest, if we can't accept that, maybe we should all move to Switzerland. You made it sound pretty great there.
Response to Reason 7:
The statement that these "economic policies are total quackery" is still your opinion. I would like you to cite there bailouts so I can respond to them in a proper manner, until then, I still don't see how anything you've written in reason 7 previously or now should be taken seriously. We can't just write down our opinions on economic policies that could take decades to test and expect it to be taken seriously now can we.
Response to Reason 8:
I extend arguments from my response to reason 1 this round. The Fed is a distributor not an issuer. If you have any problem with loopholes, you should probably move out of America.
Response to Reason 9:
As previously stated, I take responsibility for my misconception and I apologize for it.
As in this response you extend arguments from Reason 2, I extend arguments from my Response to Reason 2, paragraph 6.
You also state this: "the rate of recessions has not decreased since the implementation of the Fed in 1913. Infact it has increased."
The rate of recession has decreased twofold after the Great Depression.
To quote my citation, "From 1836-1928 the U.S. averaged a recession every 2.1 years."
2.1 years is the frequency of recession before the depression, then the source discusses the frequency after...
"You can see that roughly every four years the U.S. has entered a recession." It is clear and evident that the rate of recession decreased following the Great Depression, as the Fed "stepped up its game" if you will.
And to talk about your last statement, there's no solid evidence to back those claims. The housing bubble was caused by Cuomo believe that or not, I know it's not relevant but, I thought I would throw that out there for kicks.
I have remedied my mistakes and again dismantled all of my opponents. Nothing further on response.
My opponent chose not to respond to my main reason the Fed should not be abolished from round 2, so I merely extend my arguments. I would also like to state that the reason I chose to just post the links of reading instead of re-wording and writing it all myself is that this is all readily available information. I shouldn't have to re-state the factually established. The Fed's job is fact and multiple sources support my claim that without it, financial turmoil would ensue.
I can find no evidence that suggests that to 'coin money' means to issue paper money, only that is to stamp coins from metals. So by the supreme wording of the constitution, only the creation of coins is delegated to the congress only. If you discover a source stating differently, please post such information.
In response to the last part, I chose not to address that for a reason. The reason being that this action is not unconstitutional, and therefore unimportant to your argument.
*NOTE* There's a lot of info here (not all of it about the Sherman Anti Trust act), so I'm going respond to select quotes that encompass all of your arguments in this section regardless of what they're about. Everything in quotations is directly taken from your Reason 2 section.
"For one they let inflation get out of control, now it"s 10%, and you can guess who"s paying the bill- me, you, and everyone else!"
Who is to say this inflation is caused BY the Federal Reserve? Is that an opinion? Here is a fantastic source that properly defines how inflation occurs, and how the Federal Reserve reacts: http://www.forbes.com...
"For two, unemployment is crazy, there are 93 million unemployed people in the US, meaning that unemployment is 29%, higher than the great depression. "
This information is so horrifically false this is disgraceful. According to the Bureau of Labor Statistics (a .gov source, not YouTube) unemployment is resting at about 5%. This report was published May 6th, 2016, which is only 4 days before I write this argument.
*Side note* Stop citing YouTube videos. They are a pain in my side to go out of my way to watch them and shouldn't be considered credible citations.
In response to paragraph 3 and 4 as a whole, the 'monopoly' you claim the Federal Reserve has, doesn't really exist. Let's define monopoly. According to google monopoly means...
"The exclusive possession or control of the supply or trade in a commodity or service."
The money supply (cash money and credit in circulation) is not a commodity as commodities are bought with money.
Commodity: A raw material or primary agricultural product that can be bought and sold, such as copper or coffee.
Nor is it a service.
The action of helping or doing work for someone.
A system supplying a public need such as transport, communications, or utilities such as electricity and water.
So a monopoly on money therefore cannot exist, leaving the Sherman Anti Trust act not violated.
"the Federal Reserve was definitely responsible for this because the inflation rate from 1800-1900 was -51%, or 0.5% deflation per year, meaning 100$ in 1800 was worth 49$ in 1900, or a -51% markup. While 100$ in 1913 is worth 2400$ today, or a 2,300% markup, divided over 103 years that"s an inflation rate of 22% per year. "
Please show me your source of these numbers.
But let's for fun pretend this is real data (it's not until it's cited). Let's also pretend I didn't already provide an explanation other than the Fed for why inflation occurs. You cannot explicitly prove that the Fed is the sole cause of this inflation until you examine every other thing the US government did on an economic level in your provided time frame. This is a daunting task to say the least.
Since I already responded to the inflation argument thoroughly, I will not be addressing the last two paragraphs of this section.
"it [the Federal Reserve] doesn"t directly control the prices of our commodities"
And so the free market remains free. My favorite Italian restaurant can still charge whatever they want for spinach ravioli. 17 dollars well spent.
Of course they support private banks as well! If Citi for example goes under, all the Americans using Citi are out of luck!
I extend my previous argument on inflation. Here is a repeat of my citation.
GDP is affected by other factors as well, and these factors can be manipulated by the Fed in the favor of GDP, all of which are used and have proven to be working over the past 70 or so years. Interest rates are especially effective.
Well, it's good to see that the Federal Reserve is using its immense profits to save businesses and keep the economy strong. Being it is independent, this is a good use of its extra funds. Thank you for showing this to me.
I extend my current response to Reason 1.
Reason 4, Part 2? (I'm going to assume you meant Reason 9):
The difference between 35% of the time and 31% of the time is negligible. Additionally, according to your source, all recessions in your specified time frame were either followed by a strong recovery, or the recession overall was quite mild. This makes this argument quite a bit less potent.
My only response to my opponent's arguments as of now, is not only do they seem to fall apart with simple provocation, but my opponent has consistently backed up a few of his beginning points with false information, such as, the 93 million unemployed. I can only hope that was a troll.
I extend all previous arguments in favor of the Fed that I have previously stated over the rounds.
"My opponent is right in that "to coin money" means so stamp bars/ coins of gold or silver to certify that they are a certain weight and purity of gold or silver."
So by this definition of coining money, the Federal Reserve does not coin money. Therefore, the Federal Reserve is in no way violating the supreme writing of the Constitution.
In the last quote you provided clearly it is clearly stated that this only applies to States, so I don't see where you're going with that one. So the States cannot grant letters of marque and reprisal?
From Wikipedia: In the days of fighting sail, a letter of marque and reprisal was a government license authorizing a person (known as a privateer) to attack and capture enemy vessels and bring them before admiralty courts for condemnation and sale.
So... Not really sure what I'm supposed to say... You seem very off topic.
"My opponent claims that inflation is not caused by the Federal Reserve, though this is easily disproven and soi is his link, even though forbes is commonly a reliable website."
You claim that this is easily debunked (disproven is not a word), but you never debunk it. The information I provided still stands strong and true. I'm not sure if the explanation of market based economics was supposed to debunk the source, but it's completely unrelated.
"Secondly, there are 151 million jobs in the United States, there are 320 million people in the US, thus there are 169 million unemployed in the US, this means that unemployment is at 53%. "
I don't know how to respond to this buffoonery other than to re-cite my original source.
I don't know how it is possible for one to believe that more than half of the entire citizens of the US are unemployed.
For the rest on monopoly I'll indulge in what you've written instead of arguing over definitions, it'll make this a lot easier.
A monopoly at its core is exclusive control of something (broadening the definition in your favor). The Federal Reserve does not have exclusive control over our nation's money, it's a fact. Everybody owns money, and everybody can do what they want with their money (except destroy it of course). The Fed does control the supply of money, but for the reasons I've already cited to oblivion, to help battle inflation. As the rest of this section is about inflation, I extend my arguments.
"the Federal Reserve really shouldn"t bail out Citi if it goes under because if Citi goes under, it"s because of its own destructive behavior"
Banks can go under for a variety of reasons, such as sudden withdrawals and bad loans. While some bank failures in the past may have been the fault of the bank, now that's a far cry, and banking disasters are more likely to occur based on the factors caused by us, the people.
I had a real trouble understanding this paragraph. I'm not sure if it was grammatical or what. I'll try to address the point I think is being made.
"Though, over time the GDP growth and the rate of Recessions seem to decrease over time, and at rates independent from Federal Reserve involvement."
You say this but have provided no alternative to why the GDP growth and rate of recession decrease occurred.
Social Security fights inflation (that I proved is not caused by the Fed) with its COLA system. While like I stated earlier, wages are negotiated through unionization.
"no, the Federal Reserve giving free money to corporations is not good, because the majority of these were given to banks, the same banks who ruined the economy"
How did they ruin the economy? I already clarified that banks are usually not solely responsible for bank failure.
"they don"t need this money, and if they say they cannot redeem deposits, they are full of crap because it"s all in Bermuda."
Your rambling is not cited or proven in any way.
"these recessions were not quickly recovered from"
According to your provided source (https://en.wikipedia.org...) here are the descriptions of each recession in your specified time frame.
#1: "This was a brief but very sharp recession and was caused by the end of wartime production."
#2: "The recession was short, but extremely painful...The economy had a strong recovery following the recession."
#3: "Industrial production declined in 1923"24, but on the whole this was a mild recession."
#4: "This was an unusual and mild recession"
So according to your own source, your statement is false.
"infact they were all just one big recession which the Federal Reserve kicked down the road a little further, when it was time to pay the bill, they kicked it down farther until the crisis grew too big to kick farther."
And your proof is again nonexistent.
Final Words / A debate in review:
I'd like to thank harrytruman for a good debate, and I'd also like to review my interpretation on the standings and give some last thoughts before I close.
Reviewing spelling and grammar / conduct:
I leave this to our judges.
Reviewing the strength of arguments:
At the very least, I have provided reasonable doubt in every single one of my opponent's arguments. On the flip side, my opponent has not done a single thing to address my only argument, choosing to leave it uncontested. As he clearly stated to me that the burden of proof was split among both of us, I have no idea why he chose to ignore my only main argument for why the Fed should not be abolished.
All right. I have nothing further to say. Thank you for your patience.
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