Guest op-eds do not always reflect the opinions of the author. RedState.com.)
The Federal Reserve is focusing on climate change as the U.S. suffers from stagnant growth and widespread inflation.
For instance, on November 3, the Federal Reserve issued a press statement “in support of the Glasgow Declaration by the Network of Central Banks and Supervisors for Greening the Financial System (NGFS).”
Per the Fed’s statement, “Climate change poses significant challenges for the global economy and financial system, with implications for the structure of economic activity, the safety and soundness of financial institutions and the stability of the financial sector more broadly. A sustained global response by national authorities, the international community, and the private sector can address the financial and economic implications of climate change.”
The Fed seems more willing to utilize its resources and bandwidth in order to address climate change, rather than declaring war upon inflation and the rest of the problems that face the U.S. Economy.
Just in case the Fed’s recent statement on its quest to fight climate change was not enough to placate radical leftists, Fed Chairman Jerome Powell made it clear that the Fed, under his leadership, will prioritize climate change above all else.
Powell was recently appointed by President Biden as the Fed Chairman for a second time:
The Federal Reserve will work collaboratively to address climate-related threats in an analytically rigorous and transparent manner. The creation of the Supervision Climate Committee (and the Financial Stability Climate Committee) allows us to work together in order to understand and mitigate climate-related risks that financial institutions face and for the wider financial system. The foundation will be laid for the creation of a suitable program to assess the resilience of supervised businesses to such risks. Our research will continue on the link between climate change, financial stability and other factors. We’ll also be looking at how climate change might increase vulnerability in financial sectors and look for climate-related amplifying channels.
Like Powell, President Biden believes the Fed should pivot from its mission of “foster[ing] the stability, integrity, and efficiency of the nation’s monetary, financial, and payment systems so as to promote optimal macroeconomic performance.”
In fact, Biden wants the Federal Reserve to make climate change its “top priority.”
As Biden put it, “We have to make sure our financial system can withstand climate change and is prepared to transition to clean energy. … The Fed must be a leader among central banks globally in addressing climate-related financial risks.”
Fortunately, several Republican lawmakers are pushing back against the Fed’s mission creep into climate change policy.
“We question both the purpose and efficacy of climate-related banking regulation and scenario analysis, especially because the Federal Reserve lacks jurisdiction over and expertise in environmental matters,” wrote many Republican senators in a letter to Chairman Powell.
The GOP lawmakers added, “This effort is not grounded in science or economics, but is instead a self-fulfilling prophesy: claim there are financial risks with energy exploration and other disfavored investments then use the levers of government—via the unelected bureaucracy—to ban or limit those activities.”
Recent polls show that Americans are more worried about concrete economic issues, particularly inflation, than they are with more abstract problems like climate change.
In fact, the Federal Reserve has been complicit in inflation skyrocketing over the past decade due to endless money printing, ultra-low interest rate, and other factors.
Instead of shifting to climate change which isn’t an existential crises, the Federal Reserve needs to return to its roots and deal with the pressing issues that it was chartered over a century ago. That includes inflation which has just hit a 30-year peak of 6.2 percentage.
Chris Talgo ([email protected]) The Heartland Institute’s senior editor.
About Post Author
