How the Fed Can Boost Growth

The U.S. is in a vulnerable position. Its military is stretched thin supplying the current wars and will take years to rebuild. The abrupt withdrawal from Afghanistan damaged America’s global reputation, making it difficult to galvanize opposition to Russia or Hamas via once-formidable American soft power. The U.S. is also struggling economically under an administration dominated by activist regulators and a badly broken budget process that contributes to the nation’s decline through high spending, taxes and debt. Long-term economic growth projections are below 2%.

There is, however, a bright spot. The recent peak in bond yields creates an opportunity for the Federal Reserve. It has monetary and regulatory powers that deeply influence growth. It needs to use them.