In this world, there exists a multitude of supranational organizations, agencies and committees which, may or may not, work in concert with each other for the purpose of central planning. Countless bureaucrat salaries are funded with the public’s money or debt, paid not to produce goods or services that have a market price; instead the goal is to rearrange society based on the notion that they possess a calculation method or some higher knowledge allowing them to know how society “should be.”
One such planner is Randal K. Quarles. Hardly a household name, he sits on the Board of the Federal Reserve’s Board of Governors, but also is the Chair of the Financial Stability Board (FSB). The FSB has a lengthy mandate including activities such as monitoring and making recommendations about the global financial system. Per note 6 of the FSB’s financial statements, they are funded by the Bank for International Settlements (BIS) and the International Monetary Fund (IMF).
The reach and authority of these worldwide organizations appears both wide and perplexing to anyone who is not on their payroll. Despite relative obscurity, the FSB produces reports for G20 nations and other countries across the globe. On Monday, Chair Quarles demonstrated the problem of these organization in his latest speech, from beautiful Madrid:
Living through the events of last year was an experience of near chaos. The world had stopped functioning the way it should, leading to unexpected—and in some cases almost unimaginable— outcomes, including in our financial markets.
This idea that an organization knows how the market should be is very dangerous and has been the source of needless hardships throughout history. Financial markets, stock exchanges, worldwide and local economies have unfathomable moving parts, all requiring the actions of individuals. A planning task force is a polar opposite of the market in which they intervene. Enjoying the benefits of government granted abilities, they remain on the sidelines, capable of providing nothing except market distortion.
Never selfless, but always self serving, planning organizations must remain steadfast to collectivist propaganda no matter how egregious the claim. One such claim can bee see on a report from last year that speaks to the importance of anti-free market policies during the march market turmoil:
Absent central bank intervention, it is highly likely that the stress in the financial system would have worsened significantly.
A common tactic used by those who deceive is the notion that without their help, life would be much worse.
The problem is two-fold. Since this is a claim on a future that never happened, the claim is without merit. Conversely, one could attempt to envision a future without their intervention and find that it doesn’t seem all that scary after all.
We’d have to consider a world where interest rates are not centrally controlled, and where trillions of dollars of debt weren’t created to inflate asset prices, house prices, stock prices and the costs of goods and services. Imagine a future where almost $800 billion in Paycheck Protection forgivable loans didn’t exist because a handful of individuals thought it was a good idea to pay people not to work. As for the national debt, the $29 trillion mark will be passed soon. Such inflationary feats and the capital destruction that follows would never be made possible without the aid of a central planner and their monopoly banks.
Naturally, Chair Quarles shows little interest in exploring free market solutions because organizations like the FSB have no role to play in a truly free society. As explained:
…the “COVID event”— was precisely the kind of global crisis that the FSB was created for, and—as was envisaged— the FSB has played a central role. But our work is not finished.
By any metric, whether data or anecdotal, the idea behind central planning should start to weigh on the public’s conscious. A robust market will always function in the absence of government oversight, central banking and the use of a central planning committee. Whereas the central planner and all other bureaucrats need some semblance of a free market in order to redirect resources according to plan, which is unfortunate because increasing the wealth for the richest members of society looks to be the purpose of the plan.
