THC,
You argument seems to be that:
1. The policiticians cannot be trusted with our monetary system.
2. Therefore we need an "independent" entity to control our monetary system.
Nope.
And most supporters of a gold backed currency would concur.
That's why most normally support a gold standard because it limits the supply of money according the amount of gold bullion physically available to back it up.
On the other hand, the FRB was set up primarily because of the boom/bust inflations and deflations that occurred DESPITE being on a gold standard. Much of this was as the result of having to fight various military actions that required printing money above the limitations of available bullion.
This increased the available money supply, inflating the price of goods (as wars so often do) and afterwards there would be an attempt made to bring the money supply back into balance. But the resulting hard landing required to tame inflation resulted in those who held previously inflated currency suddenly seeing their purchasing power increase, while those who did not have savings were left un/underemployed and bankrupted as prices suddenly declined with the forced contraction of the economy.
The currency of politicians is jobs. Nothing wins votes for office like bringing home the "bacon". And nothing makes the common man feel better than knowing that Congressman "muckety-muck" was able to get a billion dollars in Federal spending thrust into his district so that Joe Six-Pack could have a job.
There is not much discipline in politics. Politicians always want the economy to grow, wages to go up, and for the people to feel good about future. That's how presidents stay in office or get kicked out.
Now the primary issue is how discipline is meted out. Is it to be done through adherence to a shiny metal that requires substantial economic assets to discover, extract, and refine? Or is through the "tough father figure" <VBG> of an independent bank that knows how to say no to the politicians but also how to be flexible enough not to let discipline be the end-all.
This is not an easy topic to fully understand. But let it be said that both systems, gold and Fiat, are flawed in some way or another.
The difference is that human beings should be the master of money and not the other way around. Gold becomes the master when it prevents prudent human flexibility in handling monetary policy.
Regards,
Ron
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