Paul Volcker, appointed Fed Chairman by Jimmy Carter, said, " . . . inflation is bad [and] the primary job of a central bank is to prevent inflation. That's taken for granted."
Alan Greenspan, Fed Chairman after Volcker, tinkered with the economy to be "pro-growth" and not strictly "anti-inflation."
Ben Bernanke, today's Fed Chairman, is off the charts.
Bernanke worried that the investment firm, Bear Stearns (BS), was too big to fail (TBTF)--that if BS failed, the economy would take a huge hit. So Bernanke put the Fed's assets on the line, backing a sale of BS.
This created a horrible problem. Now, other big companies have incentives to take huge risks because the Fed will bail them out if they are TBTF. One of the Fed district banks just released a publication in which that bank's president explores the crazy can of worms that Bernanke opened.
Bernanke continues to spin out of control. Recognizing the TBTF problem, he now recommends that the Fed be given power to regulate large financial companies. Since the Fed will bail out the TBTF's, the Fed will regulate those companies and make sure they do not take risks.
Under a capitalistic system, people assume the risks of their enterprises. Under a socialistic system, papa government says, "I know better."
History has shown that capitalism works much better than socialism. When individuals attempt to excel by trading with others and competing with their rivals, our well-being steadily improves.
Papa government is big and slow and dumb. Papa G.'s money is not on the line. Papa G. is self-interested, too, but his self-interests do not align well with the public interest.
Perhaps Congress has two choices. If they decide that socialism is best, they should hire Mikhail Gorbachev to find an old-line commie to take Bernanke's place. If they decide that capitalism is still viable, they should hire Glen Hubbard, who predicted all this would happen and made this excellent video.