Huffpost: Romney Pledges A Fed That Will Screw Workers– Huh?

This is the title (see below) of a piece by Dean Baker. Here is his logic if we can call it that. Romney would appoint a new Fed chair who will keep the value of the dollar high against other currencies. This will make our goods too expensive to sell abroad, deepening unemployment, while helping rich people buy more abroad when investing or on a trip.

Baker also says that this “strong” dollar policy is bi-partisan and has already cost us 6 million jobs.

Baker is right about bipartisanship, although not bipartisanship in favor of a strong dollar. Alan Greenspan, appointed Fed chairman by Reagan and reappointed by Clinton, trashed the dollar by printing far too many of them. Ben Bernanke, Greenspan’s successor, appointed by George W Bush and reappointed by Obama, has continued to trash it. The result has been two bubbles (dot-com and then housing) followed by two busts, the last one in 2008 colossal. To use Mr. Baker’s crude  language, didn’t that ” screw workers?”

Since 2008, both Obama and Bernanke have tried to deal with the bust in the usual way by doing more the same things that created the bust in the first place, printing tons of new money and trying to entice people to borrow it in order to blow up new bubbles. Failing that, they have been content to see banks use the new money to buy US government debt which might have collapsed without the artificial support it was getting from all the new money.

Maybe Baker would understand better if Romney called, not for a strong dollar, but for honest money. That is what has been missing, with tragic consequences, and we cannot expect to recover without finding our way back to it.

Click here for the article.