by Kenneth Kalczuk
The American Institute for Economic Research
Wouldn’t it be strange if the government director of an industry wanted to end that industry? Like if the Secretary of Education wanted to close schools, or if the Secretary of Agriculture hated farming?
The implications of President Biden’s recent nomination for the head of the Office of the Comptroller of the Currency (OCC), Saule Omarova, reach far beyond “stricter financial rules.” In a forthcoming article for the Vanderbilt Law Review, Omarova expresses her desire to “end banking as we know it” by replacing all private bank deposits with central bank accounts.
Omarova’s proposal, dubbed “FedAccounts,” would replace private deposits with central bank accounts as part of her larger plan to “democratize finance.” However, such a restructuring would result in greater authority in the hands of unelected officials and an overall loss of financial privacy with no guarantees of greater policy effectiveness.