A simpler argument against the Fed becoming "The One."

Shelby, Dodd: Not Clear Fed Is Best Regulator
WASHINGTON -- Senior lawmakers are questioning the Obama administration's plan to task the Federal Reserve with monitoring firms deemed so big and influential that their demise could hurt the economy. Sen. Richard Shelby of Alabama, the top Republican on the Senate Banking Committee, sharply questioned Treasury Secretary Timothy Geithner on the proposal, which he says represents a "grossly inflated view" of the Fed's expertise. Sen. Christopher Dodd of Connecticut, the panel's Democratic chairman, says he hasn't decided yet whether it makes sense. He asked Geithner whether the Fed has too many responsibilities already and if the Fed's "track record" in failing to prevent the economic crisis would be a problem. Geithner defended the plan, saying the Fed is the best option and that one organization must become accountable.
****(1)It is axiomatic that the Federal Reserve, as with any central bank, should be independent. It is already problematic as to how much control the Obama administration exercises over the Fed because Chairman Bernanke is up for renewal in 2010 and because how joined at the hip he seems to have been and be with Treasury Secretary Geithner.
(2) It is clear that President Obama is a control freak, veering the country towards statism in many respects. Is it likely that he will see the Fed invested with vast new powers that are independent of his control? Hardly.
(3) Therefore, making the Fed even more powerful is indicative of its even further loss of independence.
This, by the way, is why I actually prefer Lawrence Summers to be the next Fed Chairman. He is as much an egotist as Obama and would be more likely, with a 12-year appointment, to steer an independent path. P.S. One horrifying thought occasioned by Geithner's being called "Chairman" at a hearing and responding "Not yet." While it is clear that his aspirations include becoming Fed Chairman, it should be unthinkable but, in an Obama administration, is perhaps not.****