Introduction
The Federal Reserve System, often referred to as the Fed, is a key player in the economic landscape of the United States. Established in 1913, its primary function is to regulate the country’s money supply and control inflation, thereby preserving and controlling the stability of the U.S. financial system (Shankle, 2022). However, the Fed’s role and actions have been controversial, with many critics asserting that it can overstep some moral and even biblical principles in relation to the realized economic policy. This paper aims to identify and examine these assertions related to the U.S. Federal Reserve System within a biblical context.
How the Fed Has Overstepped Biblical Principles in Economic Policy
Take No Interest
Some Biblical principles, as outlined in the Holy Scriptures, provide specific guidelines on economic dealings. It is important to note that they emphasize fairness, justice, and caution against usury or excessive interest rates. Leviticus 25:36-37, for example, admonishes, “Take no interest from him or profit, but fear your God, that your brother may live beside you. You shall not lend him your money at interest, nor give him your food for profit” (“The Bible: English Standard Version,” 2023). This claim can be discussed as implying that charging interest, particularly high rates, violates the biblical directives.
One should state that the Federal Reserve, through its monetary policies, often manipulates interest rates to overcome inflation effects and sustain the economy. In times of economic downturn, the Fed decreases interest rates to stimulate borrowing and spending, thereby boosting economic activity. Conversely, when the economy is overheating, the Fed increases interest rates to slow down borrowing and spending (Shankle, 2022). This manipulation of interest rates, especially when they are high, can be seen as a violation of the biblical principle against usury, as it can lead to the oppression of borrowers.
False Balance vs. Just Weight
Furthermore, one should state that the Bible warns against unjust scales and dishonest measures in trade. As it is said in Proverbs 11:1, “A false balance is an abomination to the Lord, but a just weight is his delight” (“The Bible: English Standard Version,” 2023). This statement implies the importance of integrity, honesty, and fairness in economic transactions. In addition, critics tend to argue that the Fed’s role in controlling the money supply, often through quantitative easing, can be likened to using rather unjust scales (Shankle, 2022). The Fed essentially creates money out of thin air, which critics argue can lead to inflation, devalue the currency, and burden future generations with debt, actions that can be viewed as unjust and unfair.
Conclusion
In conclusion, it is essential to note that the role and actions of the Federal Reserve can be viewed as an overstep of the biblical principles in economic policy. While its primary objective is to maintain economic stability, its methods, particularly interest rate manipulation and control of the money supply, can be seen as conflicting with the biblical values of fairness, justice, and avoidance of usury. It is essential to claim, however, that the application of biblical principles in modern economic contexts is complex and requires careful interpretation. Nonetheless, this analysis serves as a reminder that economic policies should aim for economic stability and uphold the principles of justice and fairness as much as possible.
References
Shankle, D. (2022). Biblical economic policy: Ten scriptural truths for fiscal and monetary decision-making. Deep River Books.
The Bible: English Standard Version. (2023). Bible Hub. Web.