Fed Power

How Finance Wins

Lawrence Jacobs and Desmond King

Powerful critique of how the Federal Reserve governs the American economy
Essential reading for anyone interested in inequality

Fed Power

How Finance Wins

Lawrence Jacobs and Desmond King

Description

The Federal Reserve is the most powerful central bank in the world. Without its central bank, the American economy would be subject to devastating fluctuations and instability. In maintaining this stability, The Fed dictates interest rates and designs bailouts without the usual checks and balances that pervade US policy making. Most commentators treat the Fed as an impartial referee exercising its independence to advance the best interests of America.

Wrong.

Lawrence Jacobs and Desmond King's Fed Power is the first sustained examination of the Fed as a potent institution in its own right and an engine for producing concealed advantages for a privileged few. The authors trace the Fed's historic development from the fiery tug-of-war over monetary policy during the 19th century to its current position as a powerful cog in the "big government" machine with unparalleled capacity and autonomy to intervene in private markets. Jacobs and King dissect how the Fed's programs during the Great Recession funneled enormous sums to a select few in the finance industry while leaving Main Street businesses adrift and millions of homeowners underwater. Far from serving the national interest, the Fed increased economic inequality in America and further enriched the "one percent."

America is heading into the next financial crisis without an effective central bank. 'End the Fed' is a popular slogan that not only voices the people's displeasure with the Fed's favoritism, but also speaks to a national feeling of the Fed's illegitimacy. Lacking a powerful and capable central bank is a roadmap to mass unemployment and impoverishment. Jacobs and King present an energetic reform agenda to build an accountable central bank in America to ensure the economy remains stable and prosperous.

Fed Power

How Finance Wins

Lawrence Jacobs and Desmond King

Fed Power

How Finance Wins

Lawrence Jacobs and Desmond King

Author Information

Lawrence Jacobs, Professor of Political Science, University of Minnesota, and Desmond King, Professor of Politics, Oxford University

Lawrence R. Jacobs is a Professor of Political Science at University of Minnesota.

Desmond King is a Professor of Politics at Oxford University.

Fed Power

How Finance Wins

Lawrence Jacobs and Desmond King

Reviews and Awards

"A welcome demonstration that grounded academic work can be entertaining as well as informative. Lawrence Jacobs and Desmond King, political scientists from the universities of Minnesota and Oxford respectively, live up to their claim to 'jettison the all-too-common hermetic language of academia in favor of candor and directness'... A book that is engaging throughout and generally persuasive in its principal thesis that the Fed is a politically loaded institution that drives rising inequality." - Philip Augar, The Financial Times

"[A] groundbreaking book, Jacobs and King would argue that Bernie is not directing his progressive populist proposals at the best target: the Federal Reserve. As Jacobs and King convincingly lay out, the Fed has evolved over the century since its 1916 founding (as part of that Progressive moment, naturally) to become both the most powerful and the least public and democratic of our federal economic institutions...Fed Power represents a vibrant form of 21st century financial populism and a vital intervention in our political and social debates." - Ben Railton, The Huffington Post

"[Jacobs and King] use the tools of political science to examine the Federal Reserve as an institution ... [and] argue that the democratic accountability of the Federal Reserve has suffered because of the bailouts. And it's completely true that the Federal Reserve pushed their powers beyond what anyone had expected... There is a lot to be impressed with in this book." - The American Prospect