It isn’t often that I agree with Paul Krugman. But on Friday, Krugman devoted his NYT column to the idea that “[m]onetary policy probably won’t be a major issue in the 2016 campaign, but it should be.”
Well, Krugman got it half right anyway. In truth, not only should monetary policy be a campaign issue, it already is.
Last week we watched Bobby Jindal force everyone from Chris Christie to Jeb Bush to start talking about Common Core. In a press release last week from American Principles Project, we called this “The Jindal Effect.”
Maybe we should start talking about “The Paul Effect.”
Rand Paul, who has also been one of the leading candidates opposed to Common Core, often covers atypical issues for a Republican—he believes in sentencing reform and eliminating mandatory minimums, has ridiculed the “war on drugs,” and has focused much of his time in the Senate on the Federal Reserve and monetary policy.
Indeed, a cursory scan of Rand Paul’s Facebook page reveals more than 15 posts about the Federal Reserve in just the past week, including this quote:
“Once upon a time, your dollar was as good as gold. Then for many decades, they said your dollar was backed by the full faith and credit of government. Do you know what it’s backed by now? Used car loans, bad home loans, distressed assets and derivatives. #AuditTheFed” – Rand Paul (via Facebook), Feb 7, 11:00 A.M.
Monetary policy was once a niche issue that establishment Republicans gave little credence to—but after years of failed monetary policy and years of activists demanding accountability from the Federal Reserve, that’s finally set to change.
This time, it’s serious. This time, the Fed matters.
The push for accountability at the Federal Reserve is, of course, not new. Ron Paul had been pushing it for years and made it a core platform issue in both of his recent runs for President. His son, now a U.S. Senator from Kentucky, has picked up that mantle.
But there’s a difference between Ron and Rand. Ron was seen as out of the mainstream. Rand is seen as a force to be reckoned with.
When Ron Paul was talking about the Fed during 2008 and even in 2012, very few competing candidates paid any attention. They acknowledged that Paul had a niche base, and they weren’t interesting in wooing it.
Now, it’s clear that the Federal Reserve and its failed monetary policy is a much bigger issue to the electorate, as several Republican presidential candidates have been talking about it:
Ben Carson: “The big problem today is that [the Fed’s] artificial suppression of interest rates through monetary policies changes circumstances that people used to count on for retirement and small business opportunities.”
Even Rick Perry has a history of talking about the Federal Reserve. In 2011, he called the Fed’s overprinting of money “almost treasonous” and made headlines in 2013 for demanding Texas’ $1 billion in gold reserves back from the Federal Reserve.
So where do we go from here?
This year, in the 114th Congress, Congressman Thomas Massie (R-KY) introduced the “Audit the Fed” bill in the House. The bill currently has 133 cosponsors and is expected to pass.
Senator Paul introduced a similar bill in the Senate, where he will face significant opposition from Democrats, including supposed “economic populists” like Senator Elizabeth Warren.
However, legislative pushes to Audit the Fed and establish a monetary commission to look at different monetary policy options are slowly turning from pipe dreams into reality.
This time, the Federal Reserve isn’t some niche issue. This time, if you’re a candidate for President, you had better have a plan to fix our broken monetary policy, or else you might be watching someone else take on Hillary Clinton in 2016.
Jon Schweppe is Deputy Director of Communications for American Principles in Action.