Ben Shapiro Drops a Bombshell: The Fed’s Rate Cut Will Hurt More Than Help

Ben Shapiro Sounds the Alarm in Latest Episode of ‘Facts’

8 min readSep 19, 2024

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In a move that’s sure to reverberate throughout the economy, the Federal Reserve has cut interest rates by half a point for the first time in four years.

While this might sound like dry economic news reserved for financial experts, Ben Shapiro’s latest episode of Facts (Ep. 17), titled “Why The Fed Interest Rate Drop Matters To YOU,” shows how this decision impacts everyone — especially everyday Americans.

In this episode, Ben dives deep into the immense power central banks, and particularly the Federal Reserve, hold over global economics.

He explains how the abandonment of the gold standard shifted the balance of economic control from elected officials to unelected bureaucrats. These central bankers now control the levers of inflation, interest rates, and ultimately, employment.

Shapiro highlights how fiscal irresponsibility from lawmakers has left Americans increasingly vulnerable to the whims of these powerful institutions, making the Fed’s actions a matter of personal concern for all of us.

But what does this mean for your wallet, your savings, or even your job?

Ben breaks it all down, making the complex world of monetary policy relevant to everyone tuning in. Watch the full episode below:

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If you’d rather read than watch the entire video, we’ve summarized some of the key points of Facts Episode 17 below…

The Role of Central Banks in Global Economics

According to Ben Shapiro, the Federal Reserve’s decisions are no longer just headline news for Wall Street insiders — they dictate the fate of economies around the world.

In Facts Ep. 17, Ben emphasizes the unprecedented power wielded by central banks like the Federal Reserve. Every quarter, the financial world holds its breath as Jerome Powell, the Fed’s chairman, announces new interest rate decisions.

These moves not only influence Wall Street traders but also impact businesses, consumers, and even governments.

What’s perhaps most eye-opening is how unelected officials — rather than legislatures or presidents — now control critical aspects of the economy.

Shapiro explains that, thanks to the Fed, prices, savings, and employment rates are all dictated by a select few central bankers. While these technocrats aim to manage inflation and maintain employment, the ripple effects of their decisions hit ordinary Americans the hardest.

Shapiro’s larger point?

The global economy isn’t being controlled by entrepreneurs or democratic institutions but by the centralized decisions of a few “pseudo-experts” who have the authority to raise or lower interest rates at their discretion.

This shift in control, away from the public’s hands, highlights a broader economic concern: the power of the Federal Reserve over your everyday financial life.

The Impact of Interest Rates on You — the Consumer

Ben Shapiro skillfully connects the Federal Reserve’s recent rate cut to its effect on consumers. Lower interest rates may seem beneficial at first glance — they make borrowing for mortgages, auto loans, and business investments cheaper. But as Ben explains, it’s not that simple.

A rate cut typically signals that the economy is slowing down, and the Fed is taking action to encourage spending and borrowing. For businesses, lower rates could lead to growth and expansion, but they also reflect underlying concerns about economic weakness.

Shapiro argues that while consumers may see lower borrowing costs, the bigger question is whether this cut is an indication of impending economic struggles, with potential job losses on the horizon.

Furthermore, interest rate cuts can also spark inflation, meaning that while borrowing costs may go down, the prices of goods and services could rise — hurting your wallet in the long run.

Shapiro makes it clear that what sounds like a financial relief on paper can actually have broader, more complicated consequences for average Americans.

Abandonment of the Gold Standard

Shapiro takes a historical perspective, linking the current situation to the abandonment of the gold standard in the 20th century.

Before 1933, the value of the U.S. dollar was tied to a fixed amount of gold. This system limited the ability of central banks to manipulate monetary policy, as elected officials were primarily responsible for the economic decisions of the country.

Ben argues that under the gold standard, economic control was in the hands of the public’s representatives. Legislators were responsible for fiscal policy — deciding whether to tax or spend — and the economy’s health was directly tied to their actions. This provided a level of accountability that is no longer present today.

When the U.S. left the gold standard, the Federal Reserve gained the power to increase or decrease the money supply at will, decoupling the value of the dollar from any tangible asset.

Shapiro stresses that this shift has allowed the Federal Reserve to exert unprecedented influence over the economy, and with it, Americans’ financial stability.

In his view, the Federal Reserve’s unchecked power over monetary policy is one of the greatest consequences of the country’s departure from the gold standard.

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Fiscal Irresponsibility and Its Consequences

Ben Shapiro doesn’t hold back in criticizing the growing fiscal irresponsibility that has taken root in Washington.

In his view, politicians have become increasingly reckless with the nation’s finances, piling on debt without any real plan to pay it back.

The most dangerous part?

These same politicians are more than happy to pass the buck to the Federal Reserve, relying on central bankers to manage the consequences of their actions.

Shapiro argues that this has led to a dangerous cycle: lawmakers, driven by political pressures, push for more spending, running up massive deficits, while expecting the Federal Reserve to counterbalance these decisions by manipulating interest rates and controlling inflation.

The result is a system in which unelected officials, not politicians accountable to voters, are left to clean up the economic mess.

Ben draws a direct line from this fiscal irresponsibility to everyday American struggles. As politicians spend without restraint, central bankers are forced to adjust monetary policy, and often, it’s the average consumer who bears the burden.

Rising inflation, increasing costs of living, and potential job instability are all consequences of lawmakers’ reluctance to address the country’s growing debt problem…

According to Shapiro, we’re living in a world where central bankers are left to “pick up the pieces” of failed fiscal policies, with dire consequences for American families.

The Political Nature of the Federal Reserve

Although the Federal Reserve is meant to be an independent entity, Ben Shapiro highlights its deeply political nature.

The chairman and members of the Federal Reserve are appointed by the president, and although they have fixed terms, political pressure can still sway their decisions. Shapiro points to figures like Jerome Powell and Janet Yellen, both of whom have navigated complex political challenges while leading the Fed.

Jerome Powell, for instance, was appointed to the Federal Reserve by Barack Obama and later elevated to chairman by Donald Trump. While Powell has a reputation for being cautious with monetary policy, Shapiro explains how even someone with private-sector experience like Powell can be pressured to keep interest rates low for political reasons.

In the aftermath of COVID-19, Powell lowered interest rates to historic lows — an action that many argue contributed to the creation of one of the largest asset bubbles in history.

Similarly, Shapiro discusses Janet Yellen, former Federal Reserve chair and current Treasury Secretary, as an example of how political figures can push for looser monetary policies to drive their agendas.

While Yellen’s policies were intended to stimulate economic growth, Ben warns that her advocacy for “loose money” policies may have long-term consequences, further politicizing the role of the Federal Reserve.

Shapiro drives home the point that, despite its supposed independence, the Federal Reserve operates under significant political influence. Central bankers may be unelected, but they are not immune to political pressures, which complicates the Fed’s role in managing the economy.

Protecting Your Money in Uncertain Times

Throughout the episode, Shapiro emphasizes that the Federal Reserve’s power, combined with reckless fiscal policies, puts everyday Americans at risk. But what can you do to protect your hard-earned money in such uncertain times?

Ben offers a familiar solution: owning gold.

As part of his sponsorship with Birch Gold, Shapiro explains how converting a portion of your IRA or 401K into a gold-backed account can shield you from the negative effects of inflation and fiscal mismanagement.

With inflation rising and the value of the dollar uncertain, he suggests that gold — historically seen as a hedge against economic instability — might be the best way for individuals to take control of their financial future.

Shapiro also warns that the high taxes proposed under the current administration, particularly by Vice President Kamala Harris, could further erode personal wealth.

In his view, the Harris administration’s policies, including hikes in corporate taxes and capital gains taxes on unrealized gains, are setting the stage for further economic trouble.

For those concerned about safeguarding their savings, Shapiro suggests turning to gold as a hedge against potential market volatility and government overreach.

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The Fed’s Grip on the Economy

Ben Shapiro’s episode of Facts reveals a sobering truth: while many people assume elected officials are in control of the economy, it’s really the Federal Reserve pulling the strings.

By manipulating interest rates and the money supply, central bankers wield incredible influence over the global economy, with profound implications for everyday Americans.

Shapiro shows how fiscal irresponsibility in Washington has only increased this dependence on central banks, leaving consumers vulnerable to the decisions made by a few unelected officials.

As Shapiro aptly puts it, “It’s the central bankers’ world, we’re just living in it.” While the Federal Reserve’s interest rate cuts might temporarily lower borrowing costs, they also signal deeper concerns about the economy’s health.

And as lawmakers continue to pass the economic burden onto central banks, it’s clear that ordinary Americans must take steps to protect their financial futures — whether through buying gold or other strategies.

Shapiro’s latest episode serves as a wake-up call: in today’s world, understanding the Federal Reserve’s role in shaping the economy is no longer optional — it’s essential.