Living in the nation’s capital, it’s hard to ignore the fact that young people from across the political spectrum are doing an excellent job of influencing policy debates at all levels of the public sphere. Millennials throughout the country are becoming increasingly active with student political organizations, policy-based think tanks, and social media outlets.
This has held especially true with young libertarians who, in recent years, have grown in numbers and fought to reclaim the moral high ground that progressives have, at least in recent memory, held. Young libertarians have been in the trenches fighting to defend the basic principles of life, liberty, and property. They have taken up causes such as freedom of speech on college campuses, the demilitarization of police, and the decriminalization of drugs.
But millennials seem to have ignored a truly insidious issue that disproportionately affects their generation: the Federal Reserve and its discretionary monetary policy.
Although one need not call into question the good intentions of the bankers at the Fed, it is impossible to deny that they have been at the helm of some of our nation’s greatest financial crises. Even those who might deny that Fed policies caused, or prolonged, events such as the Great Depression or the financial crisis of 2008 must accept that central bankers at least did not see them coming and sound the alarm.
Months before the 2008 crisis, then–Fed Chairman Ben Bernanke was even quoted as saying that “the U.S. economy appears likely to expand at a moderate pace over the second half of 2007 with growth then strengthening a bit in 2008.”
As everyone knows, that was not the case.
Unfortunately, as the years have gone by and more crises have presented themselves, the Fed has moved further away from a system based on disciple and rules, opting instead for increased arbitrary discretion in an attempt to fix our ailing economy. This, coupled with a Congress that has forgotten its duty to protect the value of our money, makes for a terrifying monetary reality.
But why should millennials, of all people, care?
Well, Federal Reserve discretion affects millennials in more ways than they perhaps realize, both in the short and long terms.
As Diana Furchtgott-Roth and Jared Meyer, authors of Disinherited: How Washington Is Betraying America’s Young, note on the Sound Money Project blog:
In monetary policy, too, Washington is playing favorites and the young are the losers. They do not benefit from the decline in mortgage rates because they cannot afford home ownership. The slow economy has driven up their unemployment rates and lowered their labor force participation rates.
This claim can be further supported by a study produced by the Bank of England that shows how quantitative easing, the Fed’s go-to monetary tool in times of crisis, mostly benefited the richest 5 percent. It’s hard to imagine millennials being part of that favored demographic.
Policy battles, however, cannot be won simply by making claims that the government could do better. To influence public opinion and spur change, millennials must win the moral high ground when speaking about money and the Federal Reserve.
Luckily, that’s something that can be done.
To begin exploring the morality of money, one must first understand why it is a moral matter. As Dr. Judy Shelton notes in her book Fixing the Dollar Now:
[T]he trustworthiness of America’s unit of account is a profoundly moral issue. It impacts the value of wages, taxes, savings and investments for hundreds of millions of individuals who make countless decisions based on daily prices. If we can’t trust money, we can hardly believe in the virtues of free enterprise itself.
Ultimately, money plays a prominent role in the most basic of human interactions. Its manipulation, or debasing, is a clear violation of property rights and makes it nearly impossible for individuals to enter into contracts with predictable terms, as the value of their means of exchange is constantly subject to change.
But these ideas are not new; they have merely been forgotten. In the Old Testament, Jews are called to “have accurate and honest weights and measures,” warning that God detests “anyone who deals dishonestly.” Money is a measure of value, and this passage is directly applicable today.
Even in slightly more recent times, scholastics such as Thomas Aquinas and Juan de Mariana, both forerunners of the enlightenment, wrote at length about the morality of sound money. Mariana noted the minting of lesser-quality coins by the state (i.e., quantitative easing), and went so far as to call it “infamous systemic robbery.” For those who are interested in living in a just and moral world, the idea that money should not be debased or manipulated should come as naturally as the idea that theft and murder are wrong.
Monetary policy has and will continue to disproportionately affect the millennial generation, so its members must champion sound money as yet another one of their causes. For the sake of our future, millennials must join the generations that have fought to preserve the integrity of money and refuse to accept the morality of our current monetary system. People of all ages must fight against arbitrary discretion for central bankers and call instead for rules and monetary discipline. The moral high ground belongs to those in favor of sound money; it is high time for our generation to take it back.