Herman Cain was Deputy Chairman of the Federal Reserve Bank of Kansas City from 1992 to 1994, and Chairman of the Federal Reserve Bank of Kansas City from 1995 to 1996. Despite this personal history with the company, Herman Cain states that he does not agree with the Federal Reserve Bank's actions in recent years regarding the purchasing of debt and injection of money into the economy. He has stated that there is no need for an audit as mechanisms already in place allow the Federal Reserve to audit itself. He has been critical of those demanding an audit or calling for ending the Fed as unknowledgable of the company. However, he has stated that one of the Federal Reserve's dual mandates of controlling unemployment and controlling inflation should be removed as they can be contradictory.
In December of 2010, Herman Cain appeared on the Neal Boortz show and opposed the idea of a congressional audit of the Federal Reserve Bank. He stated that there were enough internal mechanisms in place for the Federal Reserve Bank to audit itself, and that those calling for an audit did not fully understand the Bank. He repeated these remarks at campaign events for months, and added that those who wanted to know more about the Federal Reserve Bank could simply call their district office and ask questions.
As the Presidential Campaign picked up into the summer of 2011, Mr Cain continued to called for fixing the Fed instead of ending it. He stated that ending the Fed would leave nothing in it's place and returning control to Congress was risky given the malfeasance of Congress in programs like Social Security and Medicare / Medicaid.
By September of 2011, Mr Cain has somewhat changed his view on auditing the Federal Reserve. While he still called for fixing it by removing one of the dual mandates, he stated that the Federal Reserve Bank should be audited.
Neal Boortz Show
In December of 2010, Herman Cain filled in for Neal Boortz on his radio show and stated that an audit of the federal reserve was not necessary, and that those voicing such concern may not be educated enough on the federal reserve's role.
Some people say that we ought to audit the Federal Reserve. Here's what I do know ... The Federal Reserve already has so many internal audits it's ridiculous. I don't why people think that we're gonna learn this great amount of information by auditing the Federal Reserve.
Now, I no longer serve on the board of the Federal Reserve. I'm not being defensive of the Federal Reserve. In fact, some of the policies and some of the actions of the Federal Reserve today, I don't agree with. Because the attitude and the nonpolitization in the 90's when I served is totally different than what's going on today, but that's another matter.
But people who say that we ought to audit the Federal Reserve because don't know enough about it. Well, here's the advice that I would give to people that are worried about an audit of the Federal Reserve ... Call em up, and ask them if you can have one of their PR people or one of their public relations people explain to you how the Federal Reserve operates.
I think that a lot of people are calling for an audit of the Federal Reserve because they don't know enough about it. There's no hidden secrets going on in the Federal Reserve to my knowledge. I tell people, "you know, we've got 12 federal reserve banks, find out which district you are in, call them up and go from there." We don't need to waste money to have another commission or audit that isn't necessary.
Campaign Event
At a campaign event in January of 2011, Herman Cain stated that there was no need to audit the federal reserve, due to the audits and oversight already in place. He stated that there was no need to end the reserve and that Congress needed to assert it's authority to control the money.
Campaign Video
On January 26, 2011 Herman Cain's campaign uploaded a video discussing the federal reserve and it's dual mandate of reducing unemployment and maintaining a strong dollar. He notes his support for legislation to audit the federal reserve.
During the past couple of days, i've been in Iowa, talking with the people of Iowa and one question that has consistently come up plaguing people as to the federal reserve. I've been in the belly of the beast as former chairman of the federal reserve bank of Kansas City. There is a constant struggle as to the conflicting roles of the Federal Reserve: one to keep inflation under control and the other to fight unemployment. Now, dealing with one can negatively affect the other. The current leadership of the Federal Reserve has pumped billions of dollars into our economy in an effort to fight the high unemployment, only to have the value of the United States dollar decrease.
The United States is the world's economic super power as we all know. And that's why it is important for the United States to have a strong dollar, and we need to look at removing this dual conflicting role of the federal reserve. That's why I am thankful to Representative Ron Paul for his consistent and steady pressure on the Federal Reserve. And as Chairman of the Subcommittee on monetary policy, he will have the oversight on the activities of the Federal Reserve, including the ability to require an audit of the Federal Reserve Bank.
Rusty Humphries Show
In March of 2011, Herman Cain appeared on the Rusty Humphries show and spoke about the federal reserve and monetary policy.
Rusty Humphries: ... tell me something about the Federal Reserve and why that should or should not be something that we should worry about.
Herman Cain: First of all, it's not unconstitutional. What happened was, in 1913 the Congress of the United States designated the authority of the Federal Reserve to be created. So how can that be unconstitutional? Congress has to pass the law, Congress has to pass the authority to do things and that is what they did. So it is not unconstitutional number one.
Number two, the Federal Reserve has at certain times in it's history did what it was supposed to do better than others. I don't agree with many of the policies of the Federal Reserve that we have today. When I was on the board of the Federal Reserve and Alan Greenspan was the head of the Federal Reserve, we didn't dream of doing some of the things that they are doing today.
Rusty Humphries: Like what? What was different between then and now?
Herman Cain: Then, we didn't have a $14 trillion dollar national debt that we were trying to pay off with the Federal Reserve buying our own debt. That's like incest. We never even dreamed of that, because the debt wasn't as big as it was. So for people who say that you should get rid of the Federal Reserve, Rusty, with all due respect, you can't do that. And here's why. What would you replace it with? I've some people tell me ...
Rusty Humphries: Gold and silver they'll say
Herman Cain: Yea, ... I agree with getting back to the gold standard. But we can't get back to the gold standard until we get rid of this national debt. And I had one lady tell me ... "Make Congress do it's job." Well, Congress messed up social security, Congress messed up Medicare and Medicaid. You wanna give it back to the same crooks who stole money from us out of social security? No, I would rather fix the Federal Reserve and get it to do the mission that it was charged with rather than putting it back into a committee of 535.
Palmetto Freedom Forum
In August of 2011, Herman Cain participated in the Palmetto Freedom Forum in South Carolina. He was asked about the Federal Reserve and stated that he would remove one of the dual mandates of unemployment and sound monetary policy.
DEMINT: Let's talk about the Federal Reserve. The more I find out, the more worried I am about what they've been doing. We found out when we went through the legislative process for this TARP program which opposed, the Federal Reserve actually matched that and upped it as far as the amount of money they were sending to banks not only in this country but around the world. They've apparently bought nearly 90 percent of their own debt this year and now they're talking about another round of monetizing debt which is called quantitative easing. What would you do with the Federal Reserve, or do you think it's a problem?
CAIN: I believe we can fix the fed. The way we do that is ask Congress to limit their ability to limit their authority. One of the reasons they got into these programs like quantitative easing is because of the size of the debt and because the debt was just spiraling out of control and other countries were not buying it fast enough. They came up with these kinds of plans.
Secondly, the Federal Reserve has, unfortunately, a dual mission -- monetary stability and unemployment. That's like trying to hit two targets with one arrow. I would ask Congress to take away one of the targets. Get them back to what they were commissioned to do back in 1913, and it worked well until we got into this situation relative to the debt that we have. I believe that we can fix the fed by asking Congress to re-limit their authority to do those kinds of things.
Secondly, we have got to get back to sound money. Our dollar is suffering. It's similar to when we wake up in the morning, an hour is 60 minutes. We don't have to go look in the paper to see what it's worth. We've got to get back to a dollar is a dollar is a dollar.
TEA Party Debate
In September of 2011, Mr Cain participated in the TEA Party debate and was asked about the federal reserve. He stated that one of the mandates should be removed and it should be audited.
BLITZER: Mr. Cain?
CAIN: Yes.
BLITZER: You were once with the Kansas City Federal Reserve. Should it be audited?
CAIN: Yes, it can -- it should be audited. And, secondly, I believe that its focus needs to be narrowed. I don't believe in ending the Fed; I believe in fixing the Fed.
For many, many decades, the Fed did its job when it was singularly focused on sound money. When we wake up in the morning, we expect 60 minutes to be in an hour. Now when we wake up, because of some of the actions of the current Fed, we don't know what the value of the dollar is going to be.
In 1988, it took 1.2 dollars in order to be able to convert from Canadian to U.S. It is now totally reversed because of the current policies of the Fed.
