Why "End the Fed" Is Pure Ignorance

When I used to tell people that gas used to cost 99 cents during my time in high school, I believed it was proof that we were all getting robbed by a secret banking cabal. I used to be one of those people who repeated “End the Fed.” I know nothing about finance, so before putting this article together, I did some research on arguments for and against the Federal Reserve.

People who don’t understand finance are always complaining how everything costs much more than it used to. As population grows, productive capacity scales, and the money supply expands to match it. Consequently, the number on the sign changes. The underlying exchange ratio, measured in labor-hours, often doesn’t shift as dramatically as it feels.

But the money supply doesn’t only grow with population. It grows with government deficit spending, with fractional reserve banking, and with Federal Reserve asset purchases. When those forces outpace population and productivity growth, you get genuine inflation. The 2021–2023 spike wasn’t demographics; it was several trillion dollars injected during COVID colliding with a collapsed supply chain. That was real purchasing power loss for real people. It wasn’t a conspiracy but rather a policy failure with identifiable mechanisms.

So who’s responsible?

That question in conspiracy circles usually leads to Jekyll Island or “the Jews.”

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The “Jewish” Federal Reserve Bank

In November 1910, Senator Nelson Aldrich and representatives of the Morgan, Rockefeller, and Kuhn Loeb banking interests boarded a private train under assumed names and traveled to a private hunting club off the Georgia coast. They spent nine days drafting what became the blueprint for the Federal Reserve Act of 1913. The secrecy was deliberate. But this isn’t a conspiracy theory, since it’s documented history that the participants acknowledged afterward.

It’s true that several figures central to the Fed’s creation—most notably Paul Warburg, a partner at Kuhn, Loeb & Co. who attended the Jekyll Island meeting and became one of the Fed’s first governors—were Jewish. It’s also true that Jewish banking families (Warburg, Rothschild, Kuhn Loeb, Goldman Sachs) were disproportionately prominent in international finance in this era. Antisemites have built an entire genre out of this single fact for over a century, going back to the Protocols of the Elders of Zion (which I used to sell) and running straight through to modern “End the Fed” content that’s really just repackaged claims from the Protocols.

But the actual explanation is mundane, and the mundane version is more interesting than the conspiracy. For centuries across much of Europe, Jews were legally barred from owning land, joining guilds, and entering most landed professions. Banking, moneylending, and trade were among the few avenues left open, partly because Christian doctrine treated charging interest as sinful for Christians, leaving a gap that Jewish communities were both permitted and economically pushed into filling. Centuries of exclusion from everything else produced, predictably, generational expertise and networks in finance. By the 19th and early 20th centuries, that history meant Jewish families were disproportionately represented in international banking.

Focusing only on a demographic overrepresentation replaces the actual structural critique of the Fed. The Federal Reserve would have exactly the same structural problems if no Jews were ever involved, because the structure is the real issue.

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How the Fed Actually Works

The Fed has three main levers. It sets the interest rate banks charge each other overnight (the federal funds rate), which ripples out into mortgage rates, credit card rates, and business loans. It buys and sells government bonds on the open market, which expands or contracts the money supply depending on which direction it’s trading. And it acts as the “lender of last resort,” meaning when a bank is about to collapse from a liquidity crunch, the Fed can lend it money to prevent a chain-reaction bank run.

The dual mandate, set by Congress, is to maximize employment and keep prices stable. These two goals fight each other constantly. Lowering rates to boost jobs tends to push inflation up; raising rates to fight inflation tends to slow hiring. Every Fed meeting is essentially an argument about which side of that tradeoff to lean on, made by twelve people (the Federal Open Market Committee) based on economic data that’s always a few months out of date, which is already an issue.

None of this requires a conspiracy to be dangerous. A committee with this much discretionary power over the price of money, making judgment calls under uncertainty, with imperfect information, answerable to nobody on a two-year election cycle, is the actual problem. It doesn’t need a hidden agenda because the structure itself is the problem.

The Fed’s resulting structure is genuinely strange on top of that. The twelve regional Federal Reserve Banks are technically privately owned; member commercial banks hold stock in them and receive dividends. Private financial institutions have a structural seat inside the central bank, and it creates obvious conflicts of interest around regulation, rate-setting, and crisis response. The 2008 bailouts didn’t come from nowhere.

Where the conspiracy theory critique goes wrong is when legitimate institutional grievance gets blamed only on “the Cabal” rather than the mechanism producing monetary dysfunction, which is visible and documented: fractional reserve banking, sovereign debt monetization, and political incentives that favor spending over discipline. Scapegoating a shadowy cabal replaces analysis precisely when the structural explanation becomes inconvenient, because structural explanations demand structural solutions, and those are harder than finding a villain.

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“It’s Unconstitutional!”

I was once guilty of claiming the Federal Reserve Act was unconstitutional. This argument is about legality, which goes like this: the Federal Reserve Act was rushed through and signed by Woodrow Wilson on December 23, 1913, two days before Christmas, when most of Congress had already left town for the holidays, and therefore it doesn’t count. A similar version exists about the 16th Amendment, claiming defects in how individual states ratified it.

The Christmas Eve timing is true. It’s also not a constitutional defect. Congress can pass legislation any day it has a quorum present and voting, and the Senate vote was 43–25 and the House vote was 298–60—not exactly a stealth maneuver pushed through an empty chamber. “A lot of members chose not to be there” is a political fact about who showed up, not a legal fact about whether the law is valid. If low attendance invalidated laws, half of federal legislative history would be void.

The 16th Amendment ratification challenges are the same shape: tax protesters have argued for decades that various states’ ratification documents had typos, capitalization differences, or punctuation errors versus the text Congress sent out and that this voids the whole amendment. Courts—repeatedly, going back over a century—have rejected this. Minor clerical variations in how a state legislature transcribes a document don’t unmake a constitutional amendment that three-quarters of the states affirmatively ratified.

So if the claim is “this was unconstitutional,” the honest answer is no, not in any sense that’s held up in court, ever, and the procedural arguments people cite aren’t actually about constitutionality; they’re about legitimacy, which is a different question. And the legitimacy question is the one I’ve been addressing the whole time: not “was this legally valid,” but “should a body with this much unaccountable power over the money supply have been created this way, with private banks holding seats inside it, with minimal public debate, in the dead of a holiday week when nobody was watching.”

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The Gold Standard Argument

We all know Ron Paul’s gold standard argument. It’s primarily constitutional, not economic. Article I authorizes Congress to coin money in gold and silver. In his view, fiat currency is not just bad policy; it’s a usurpation. If the dollar is redeemable in gold at a fixed rate, the government can’t inflate at will. Paul’s instinct, that discretionary monetary power concentrated in unaccountable institutions is dangerous, is correct. However, his mechanism for constraining it is blunt and has serious failure modes.

It’s also worth being precise about what Paul actually spent decades legislating for, because “End the Fed” became a slogan that misrepresents what he actually advocated for. His signature, repeatedly introduced bill—going back to the 1970s and finally getting floor votes in 2012 and 2014—was “Audit the Fed”: full transparency into the Fed’s books, its agreements with foreign central banks, and its emergency lending decisions, none of which Congress or the public could see. The gold standard was his preferred endpoint, but the actual legislative push, the thing he spent his career fighting for, was transparency first. Even the man whose name is most associated with “End the Fed” understood that you can’t legitimately reform, or abolish, what you’re not allowed to see.

The US went off gold domestically in 1933 and internationally in 1971 precisely because the gold standard kept breaking. And the nineteenth century, the gold standard era, was not stable. The panics of 1873, 1893, and 1907 all happened without the Federal Reserve. These panics weren’t incidental to the gold standard; they were actually caused by it.

Under a gold standard, the money supply is tied to how much gold gets dug out of the ground, which has nothing to do with how much the economy is actually producing. When the economy grows faster than the gold supply, you get deflation: prices fall, debts become harder to pay off in real terms, and farmers and businesses get crushed even though nothing about their productivity changed. The 1893 panic was substantially a deflationary debt spiral of exactly this kind.

Conversely, a gold rush can flood the money supply overnight and cause inflation completely disconnected from economic output. Either way, you’ve handed monetary policy over to geology and mining technology instead of to any deliberate judgment about what the economy needs, which sounds appealingly “neutral” until you remember that an economy growing 3% a year with a money supply that can’t grow at all is an economy guaranteed to experience either deflation or someone discovering new gold deposits.

The Great Depression makes this concrete. Countries that stayed on the gold standard longer suffered longer and deeper contractions; the ones that abandoned it earliest recovered fastest. Returning to gold wouldn’t return us to some prelapsarian state of honest money. It would mean re-importing a system that produced more frequent and often worse crises than the one we have now, while removing any ability to respond to a crisis once it starts.

The Nazi “Debt-Free Economy” Myth

One claim that many in the low-IQ antisemitism space make is that Nazi Germany operated a debt-free economy, which freed itself from the Jews. This must be addressed because I learned this to be false. It continues to circulate widely because of documentaries like Europa: The Last Battle.

What Hjalmar Schacht, Hitler’s economics minister, actually did was invent a financing instrument called MEFO bills, short for Metallurgische Forschungsgesellschaft, a shell company created specifically to issue them. These bills allowed the Reich to fund rearmament off the public balance sheet entirely. Armament contractors were paid in MEFO bills, which they could redeem at the Reichsbank, but which never appeared in official budget figures. In addition, Schacht arranged bilateral barter trade agreements with other nations that bypassed international currency markets altogether.

So, Germany actually had enormous debt. It was hidden behind a shell company and a set of creative accounting instruments, not eliminated.

By 1938 the concealed obligations were so large that the economy was heading toward crisis. This is one of the reasons Hitler decided that war itself could not wait, as it became an economic necessity to sustain the financial pyramid. In other words, the Nazi economic model could only continue to work by consuming other countries.

There indeed was a “German Miracle,” as unemployment did collapse rapidly after 1933, and that demonstrates something real: a sovereign government controlling its own currency can direct credit toward employment independent of international finance. But this version also requires ignoring slave labor, plundered property as a hidden fiscal transfer, and war as economic policy.

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What About Letting AI Run the Economy?

I recently asked Claude how an economy would run if we removed humans and let AI handle it. He said an AI economy has an obvious appeal—remove human bias and political incentives and replace them with optimization. But a fatal problem is the objective function. Before any system can optimize, someone must specify what to optimize for. Low inflation? Full employment? Equality? Environmental sustainability? These goals are value choices, not technical ones, and they trade off against each other constantly. Whoever programs the objective function is the real power. And since the most powerful AI systems are owned by a handful of corporations, handing them monetary sovereignty doesn’t distribute power; it concentrates it in a technical class whose value assumptions are baked invisibly into the model.

What Would Andrew Jackson Think?

I mentioned Ron Paul, but what would Andrew Jackson think of all of this? He understood the core problem as well as anyone in American history. A federally chartered private monopoly over credit is incompatible with republican self-governance. The Second Bank’s sin wasn’t banking; it was that it held an exclusive franchise over the money supply, making every farmer and debtor in America dependent on Philadelphia financiers. Jackson killed it and paid off the national debt in 1835.

If Jackson were alive today, he would be horrified before he proposed anything. His instincts would push toward abolishing the Fed, returning monetary authority explicitly to Congress, breaking up systemically indispensable banks, and setting hard constitutional limits on deficit spending. He’d likely land on something like a sovereign money system—the federal government creates money directly, accountable to voters, rather than borrowing from a privately owned central bank. That’s his core intuition updated for a fiat currency world he never imagined, and it has serious advocates across the ideological spectrum today.

But here’s where Jackson runs into the same problem every reformer does: even if you design the perfect institution, who controls the humans who control the institution? Jackson trusted the democratic majority while simultaneously concentrating authority in the presidency and claiming to act for the common man. The tension between anti-institutional instinct and the unavoidable need for some institutional structure is where every serious monetary reformer eventually gets stuck.

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How Could We Fix the Fed?

The Fed is a symptom of a deeper condition. Fiat currency regimes backed by sovereign debt require a lender of last resort, or they are inherently unstable. Ending the Fed without addressing the underlying architecture—fractional reserve banking, deficit spending, and dollar reserve currency status—relocates the dysfunction rather than resolves it.

The first thing we must do is audit the Fed: opening the books, establishing what has actually been done with monetary policy, and determining who has benefited. Then a deliberate, structured transition away from dependence on centralized monetary control. It cannot be suddenly abolished; it would have to be a process. Paul understood this even if his loudest followers didn’t.

But even that framing sells the difficulty short. The Fed is not an alien imposition on an otherwise healthy system. It’s a product of that system, of fiat currency, sovereign debt, and the structural need for a lender of last resort that those two things together create. You can replace the institution, but you can’t replace it with nothing. And whatever you replace it with will face the same permanent question that Jackson couldn’t answer and Paul couldn’t answer and no monetary reformer has ever fully answered: who watches the watchers?

That’s not a policy problem with a policy solution. It’s the permanent condition of self-governance. Power has to live somewhere. The only honest options are to disperse it as widely as possible, constrain it with rules that are hard to bend, and stay awake to who is bending them.

What we have now fails all three tests.

The structure is doing exactly what it was designed to do. The question worth asking is, “How can we design it better?”

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