Nope, as I have heard it explained, "The Federal Reserve is controlled by the government as much as Federal Express is." It's an unaudited, private institution that controlls the money of the United States. Not positive about this, but that's what I've heard.
Guys, there was a long discussion on this at LamboPower and it was closed because this discussion, while maybe not everyone means for it to, leads into the anti-Semitic "The Jews control the world" type of argument. Best to just leave it alone.
It is not officially run by the US guv. That supposedly protects the independence of Federal Reserve policy decisions.
Keep in mind... Australia's RBA is the same as the US Federal Reserve as well... I don't see anyone complaining.
The French state controlled their own central bank. Looked how badly they screwed up in the 80s heh. By this age in human society, I don't think it matters whether the central bank is privately or publicly owned. Plenty of state owned central banks have screwed up BIG(Russia, France, and so on). And the Federal Reserve and RBA are still doing alright.
Before we get into a discussion of how money being controlled in private hands is bad...(Oddly there was a discussion about a national banking system in the 1800s...)
Consider this, what complaints do you have with the Federal Reserve?
Jot these down on a piece of paper.
Then consider this, who were the perpetrators of the mess?
S&L Loan crisis(not the Fed's fault, this was actually more or less caused by regulatory forbearance from 100% state-controlled institutions)
Hyperinflation in 1970s(this was more or less due to runaway spending by US Congress, and other factors like the 1972 drought)
1987&89 Market crash(definitely not the Fed)
The "devalued" Dollar(well... the US had been experiencing Dollar crises since the 1960s, till it finally broke up with gold in the early 1970s. Besides, the landed shouldn't complain about inflation because they buy real estate on leverage, so they're getting ahead of inflation anyways. The poor shouldn't complain about inflation either. People know about the ancient Greek statesman Solon, but how many know that before his institutional reforms, he first devalued the debt the have-nots were obliged to repay?)
Dollar losing ground(the USD was so strong in the 1990s attracting a huge amount of capital. Especially from European countries... it became a safe haven as Europeans were about to switch to the Euro and lots of under-the-mattress money had to be accounted for. People swapped their currencies for Dollars instead... So now the USD falling a bit is normal after beating the Euro to the ground)
Organizing a bailout of LTCM(Ok, lots of people dislike this one, because they think that LTCM should've been let to fail. I agree. But that's hindsight. When you're told that Russia is being insolvent and that this huge hedge fund run by a bunch of geniuses has a hundred billion in assets and trillions in notional off the book derivatives, won't you get a little worried? The whole environment is so panicky... The Fed restored confidence without even putting their own money in it. Not bad.)
Bailing out Mexico in 1982(Ok, so they bailed out a bunch of bankers who made stupid international sovereign loans(oh yea some even lent money to North Korea, go figure). What should they have done? Let the whole system collapse?)
Now one thing that people don't often mention, was the Fed turning loose the monetary spigots in the second half of 1999, because they anticipated deflation due to Y2K and added more money into the money supply in order to keep prices steady.( from Jim Rogers) Instead all that money went into stocks. This was actually a worldwide phenomenon... Europeans were doing it as well.
I'm not defending the Fed but I don't see too many reasons to knock it. They have a tough job. Often they have to clean up messes that weren't their problem. Is the trade deficit their problem? Is the budget deficit their problem? Is the national debt their problem?(In a way it is... they can lend out money to banks allowing those banks to buy 10 times the amount of T-bonds, go robbery!) They didn't cause that many of these problems yet they have to deal with all of them. Russia going broke, Mexico going under, real estate market crumbling, recession overlooming.. on and on.