Lovers of Liberty Have Little Reason to Lament the Passing of Paul Volcker

Dec. 11, 2019
Bob Adelmann

His CV – his curriculum vitae – is the first giveaway. Volcker was the quintessential "establishment" man. He graduated from Princeton's Woodrow Wilson School in 1949, spent the summer as a research assistant at the New York Federal Reserve Bank, moved on to Harvard to earn a degree in political science, and then attended the London School of Economics under a Rotary Foundation scholarship.

In 1952 he joined the staff of the New York Fed, leaving that position five years later to become an economist with the Rockefellers' Chase Manhattan Bank. Ten years later he was hired by the U.S. Treasury Department as director of financial analysis.

He was appointed by President Nixon to be undersecretary of the Treasury for international monetary affairs, where he helped Nixon break the government's promise to back the U.S. dollar with gold. By "closing the gold window" in 1971, all restraints on the expansion of the money supply by the Fed were removed. Volcker called it "the single most important event" of his career.

Aside from his long association with the Rockefeller family, Volcker was a member of the insider Bilderberg Group and a founding member of the Trilateral Commission.

In short, his CV reveals an individual who supports collectivism, decries national sovereignty, worships at the idol of globalism, ignores the Constitution, and believes the lie of Keynesian economics: that a cadre of unelected bureaucratic "experts" can guide and direct an economy as large as America's better than the individuals who make up that economy. They, in other words, believe their own press releases, medals, and wall plaques: they know what's best for the rest of us.

Accordingly, Volcker at his passing is being honored for being the fireman who put out the fire that his predecessors started!

When President Nixon tapped him to replace the faltering G. William Miller as head of the Fed in August 1979, Volcker saw his opportunity to use the now-unrestrained powers of the Fed to reverse its inflationary course. Steven Beckner, an analyst for and historian of the Fed, explained what Volcker inherited in his book, Back from the Brink: The Greenspan Years:

Under Arthur Burns, who chaired the Fed from 1970 to 1978, and under G. William Miller, who was chairman from March 1978 to August 1979, the Fed provided the monetary fuel for an inflation that began as a flicker and grew into a fearsome blaze....

If Nixon appointee Burns lit the fire, Miller poured gasoline on it during the administration of President Jimmy Carter. Without question the most partisan and least respected chairman in the Fed's history, this former Textron executive worked in tandem with fellow Carter appointee Treasury Secretary W. Michael Blumenthal in pursuit of monetary policies that were expansionist domestically and devaluationist internationally.

The goals were to spur employment and exports, with little thought to the dollar's value. By early 1980, inflation was running at 14 percent per year.

Note: the current ubiquitous use of the term "inflation" is incorrect, as Beckner properly noted. "Inflation" is an increase in the money supply, the primary tool the Fed has to manipulate the economy (along with interest rates and verbal bluster). The result is the inevitable rise in prices as the currency reflects its loss of value. "Inflation" is not "price increases," but is the cause of them.

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Further note: Inflation at 14 percent a year cuts the purchasing power of a dollar in half every five years.

Within a month of taking over as head of the Fed, Volcker began implementing a policy of reducing the money supply. Price increases, which peaked a few months later, reversed, leading into not one but two recessions. Unemployment rose to levels not seen since the Great Depression. Home builders were heavily damaged, with some of them mailing pieces of two-by-fours to his office with notes attached saying that because of his policies they no longer had any use for them. Car dealers, with lots filled with cars that people weren't able to buy, sent him baskets of car keys, with similar comments. Farmers drove their tractors to Washington in protest, surrounding and blockading the Eccles building where the Fed and Volcker were housed.

As the recessions hit, Volcker made clear his intentions: the average American must, thanks to the deliberate and intentional destruction of the value of the American dollar through inflation by the Fed, reduce their standard of living. In Congressional testimony in October 1979, Volcker blamed the coming decline on the Arabs, maintaining that, as The New York Times noted, "because of the drain of American wealth to the oil-producing countries, Americans would have to accept [a lower standard of living]." Those oil-producing countries, however, were raising their prices to offset the reduced purchasing power of the dollar, but Volcker found it convenient to hang the coming decline in living standards around their necks rather than pin the blame where it has always belonged: the Fed's inflationary policies. Said Volcker, "The standard of living of the average American has to decline. I don't think you can escape that."

In a moment of candor, Volcker admitted his anti-capitalist, anti-American bias: "One of my old friends abroad once told me – I think he meant it as an ironic complement – that he thought of my career as a long saga of trying to make the decline of the United States in the world respectable and orderly."

With his passing, one is reminded that the Fed is not only unconstitutional but was birthed in the dark of night in secrecy by international bankers. Its head has more power than any individual elected to office, and more power than any individual should ever possess. It remains a dangerous tool in the hands of totalitarians bent on reducing America's influence in order to advance their brave new world agenda.



New York Times:

Washington Post: The strongest reason to mourn Volcker: He was willing to be unpopular

Washington Post: We owe much to Paul Volcker

Daily Mail: Fed giant who beat inflation dies at 92: Paul Volcker was the most important US policy maker of the late 20th Century

Barrons: Paul Volcker, the Central Banking Giant Who Tamed Inflation, Dies at 92

Reuters: Former Fed Chief Paul Volcker, inflation slayer, dies at 92

Breitbart: Former Federal Reserve Chairman Paul Volcker Has Died

Wall Street Journal: Paul Volcker Was Inflation's Worst Enemy

Wall Street Journal: A Remembrance: The Pragmatism of Paul Volcker

Background on Paul Volcker

Background on G. William Miller

Amazon: Volcker: the Triumph of Persistence

New York TimesVolcker Asserts U.S. Must Trim Living Standard

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