Some Americans want to end the Federal Reserve. Most of us rightfully see that as a radical step that would involve the wholesale destruction of a major U.S. institution. We would no longer have a central bank, which would make us unique among rich countries. So the cause of abolishing the Fed would seem to be a lost one.
There is, however, another way to neutralize the power of the Fed that would be far easier politically. This is the notion of passing a law to tie the Fed’s interest-rate setting policy to a simple arithmetic rule. If that were done, most of the giant bureaucracy of our central bank could be replaced by an algorithm that could run on an app coded in an hour by a high school student.