The Straightjacket of Bernanke's First Press Conference

An absolute straightjacket characterized Fed chief Ben Bernanke's recent first ever press conference. It constrained him, and it constrained all reporters. Everything that was said, asked and answered revolved around GDP growth, inflation and jobs and the dollar's value. And both Bernanke and the reporters axiomatically wanted to boost the GDP, generate more jobs and assure further recovery.

Excuse me, boosting the GDP while not making the people wealthier and recovering economic processes which preceded the crisis---an economic condition lasting for decades in which more and more Americans worked longer hours yet didn't gain much, if any, net worth relative to inflation? A recovery to restore the same institutionalized massive theft on Wall Street that characterized the economy for decades before the subprime mess? And restoring and continuing the pre-crisis cronyistic relationship between the Fed, Congress, the CEOs and Wall Street? Who in his right mind would want a recovery that restores these patterns? The conference showed that neither Bernanke nor the reporters understood what preceded the crisis and what caused it.

Here are crucial issues the reporters should have asked but didn't.

l. The Fed in conjunction with Wall Street and major corporate CEO caused the crisis and thus, it is time to replace the Fed with a computer which automatically adjusts increases in monetary supply with the rate of growth of the population. This will assure no monetarily induced inflation. It will end the parasitic and incestuous relationship between the financial industry and the Fed which has caused enormous damage.

2. De-centralize Wall Street and prevent further investments abroad. Domestic investment have lagged for too many decades causing dilapidated infrastructures making the U.S. physically look worse than many emerging economy.

3. Reduce military spending and end the three wars as soon a possible and re-direct spending toward solving domestic fiscal problems and for capital investments in manufacturing.

4. Replace the obsession with more jobs with advocating fewer jobs which pay far higher wages. For many decades the constant call for more jobs--and actually generating more jobs-- was simply a method of having family members work more to compensate for the combined burdens of inflation, horrible military costs and Wall Street mischief and other economic deformities. To go into the direction of eventually restoring outlawed child labor is not a sign of economic progress. Fewer jobs with higher pay and more vacation is a true sign of economic progress. That is precisely what has happened in the more successful economies. For many decades the U.S. has indeed had one of the highest, if not the highest, adult participation in the labor force. Yet, no real measurable benefits accrued to the families and individuals.

5. Raise the value of the dollar so that that the U.S. follows the pattern of some of the successful foreign economies which were able to pay increasingly higher wages to the workers and have a rising currency value and still increased their exports. For many decades the U.S. attempted to boost exports by intentionally lowering the value of the dollar instead of investing in improving manufacturing. It didn't work while the CEOs in some competing economies, which had constantly rising currencies, were driven up the wall to produce a better product precisely to overcome their constantly rising currencies. And their trade surpluses grew constantly, too, in sharp contrast to a growing U.S. trade deficit in spite of a constantly declining dollar and relatively declining wages.

Once these suggestions are enacted, a nationwide policy to "de-junkefy" literally the U.S. from coast to coast has to be enacted to remove ALL slumhouses, all crummy mobile homes, all junked cars, all ugly billboards and other eyesores which blight the U.S. from coast to coast and make it look physically far worse than many emerging economies. It would remove the shambles and debris left over from seriously deformed economic processes. It would also aid in recovering more quickly from the seemingly increasing natural catastrophes of floods, wildfires and tornadoes