Page 661

policies and advance limited-government reforms that promote economic freedom and opportunity.” She recommends that it receive a big increase in funding and staffing and then undertake “a research agenda that includes measuring the total cost that federal regulation imposes on small businesses.” This would be one important step in making sure that “the SBA under a conservative Administration would meet the needs of America’s small-business owners and entrepreneurs, not special interests.”

Former White House director of the domestic policy council Paul Winfree writes in Chapter 24 that the Federal Reserve actually causes “inflationary and recessionary cycles.” He says, “A core problem with government control of monetary policy is its exposure to two unavoidable political pressures: pressure to print money to subsidize government deficits and pressure to print money to boost the economy artificially until the next election.” The Fed has also added a “moral hazard” due to its “history of bailing out private firms when they engage in excess speculation.” At a “minimum,” Winfree writes, “full employment” should be eliminated from the Federal Reserve’s mandate, “requiring it to focus on price stability alone.” The Fed should not be allowed to incorporate “environmental, social, and governance factors into its mandate.” It should be compelled “to specify its target range for inflation.” Its last-resort lending practices, “which are directly responsible for ‘too big to fail,” should be curbed. Its mission, and alternatives to the Fed, should be explored by acommission created for that purpose. And a central bank digital currency, which “would provide unprecedented surveillance and potential control of financial transactions,” should be rejected.

Even more ambitiously, Winfree suggests that the next Administration should think about proposing legislation that would “effectively abolish” the Federal Reserve and replace it with “free banking,” whereby “neither interest rates nor the supply of money” would be “controlled by government.” Free banking would produce a “stable and sound” currency and a “strong” financial system, “while allowing lending to flourish.” Alternatively, Winfree writes, the next Administration should “consider the feasibility of a return to the gold standard.”