Skip to main content

Sign up for our newsletter.

Quality journalism. Progressive values. Direct to your inbox.

"Next year," writes Bernie Sanders, "four of the 12 presidents at the regional Federal Reserve Banks will be former executives from one firm: Goldman Sachs." (Photo: Can Pac Swire/flickr/cc)

Sanders: When I'm President, Wall Street Foxes Won't Guard Fed Henhouse

'Unfortunately, an institution that was created to serve all Americans has been hijacked by the very bankers it regulates.'

Deirdre Fulton

Despite seven years of bank bailouts and alleged financial reform, "Wall Street is still out of control," presidential candidate Bernie Sanders writes in a New York Times op-ed on Wednesday.

In particular, Sanders blames the Federal Reserve, the central banking system of the U.S., which oversees financial institutions and is charged with using monetary policy to maintain price stability and full employment.

"Unfortunately," the Vermont senator says in the scathing op-ed, "an institution that was created to serve all Americans has been hijacked by the very bankers it regulates."

Sanders says the Fed's recent decision to raise a key interest rate by 0.25 percent is merely "the latest example of the rigged economic system."

Echoing the arguments of progressive economists, Sanders says the Fed's main reason for raising the interest rate—to keep inflation under control—is grounded in false premise. "Big bankers and their supporters in Congress have been telling us for years that runaway inflation is just around the corner," he wrote. "They have been dead wrong each time."

In fact, Sanders states, "[r]aising interest rates now is a disaster for small business owners who need loans to hire more workers and Americans who need more jobs and higher wages."

But who cares, Sanders points out, when the "chief executives of some of the largest banks in America are allowed to serve on [the Fed's] boards."

Noting that next year, four of the 12 presidents at the regional Federal Reserve Banks will be former executives from one firm—Goldman Sachs—Sanders declares: "If I were elected president, the foxes would no longer guard the henhouse."

Not only would he "fundamentally restructure the Fed’s governance system to eliminate conflicts of interest," Sanders calls for the Fed to:

  • "prohibit commercial banks from gambling with the bank deposits of the American people";
  • "stop providing incentives for banks to keep money out of the economy"; and
  • force big banks to "commit to increasing lending to creditworthy small businesses and consumers, reducing credit card interest rates and fees, and providing help to underwater and struggling homeowners."

What's more, he writes, "We also need transparency."

"The sad reality is that the Federal Reserve doesn’t regulate Wall Street; Wall Street regulates the Fed," Sanders concludes. "It’s time to make banking work for the productive economy and for all Americans, not just a handful of wealthy speculators. And it begins by making the Federal Reserve a more democratic institution, one that is responsive to the needs of ordinary Americans rather than the billionaires on Wall Street."

Our work is licensed under Creative Commons (CC BY-NC-ND 3.0). Feel free to republish and share widely.

We've had enough. The 1% own and operate the corporate media. They are doing everything they can to defend the status quo, squash dissent and protect the wealthy and the powerful. The Common Dreams media model is different. We cover the news that matters to the 99%. Our mission? To inform. To inspire. To ignite change for the common good. How? Nonprofit. Independent. Reader-supported. Free to read. Free to republish. Free to share. With no advertising. No paywalls. No selling of your data. Thousands of small donations fund our newsroom and allow us to continue publishing. Can you chip in? We can't do it without you. Thank you.

'Cleaner Air Is Coming' as London Expands Vehicle Pollution Fee to Entire Metro Area

"Around 4,000 Londoners die prematurely each year because of long-term exposure to air pollution, with the greatest number of deaths in outer London boroughs," noted Mayor Sadiq Khan in announcing the expansion.

Brett Wilkins ·

'Amazing News': Historic Shark Protections Approved at Global Wildlife Convention

Up to 90% of sharks targeted by the lucrative fin trade will now be protected, said one advocate.

Julia Conley ·

'The Nightmare Materializes': Far-Right Extremist Itamar Ben-Gvir to Be Israel's National Security Minister

The Foreign Affairs Ministry of the Palestinian Authority said Ben-Gvir's elevation to national security minister could have a "catastrophic impact on the Israeli-Palestinian conflict."

Jake Johnson ·

Raging Wars, Soaring Hunger Put Women and Girls in Crosshairs, Warns UN

"A toxic mix of crises—conflicts, climate, skyrocketing costs, and the ripple effects of the Ukraine war—are inflicting a devastating toll on the forcibly displaced. This is being felt across the world, but women and girls are particularly suffering."

Brett Wilkins ·

Greta Thunberg Joins 630+ Young People in Landmark Climate Lawsuit Against Sweden

"The Swedish state fails to meet the constitutional requirement to promote sustainable development leading to a good environment for present and future generations," said the plaintiffs.

Julia Conley ·

Common Dreams Logo