Sponsors (12)
Abolishing the Federal Reserve would transfer its assets and some accountability to the Treasury—potentially raising revenue and protecting vested Fed employee benefits—but poses large risks to monetary stability, financial system liquidity, taxpayers' fiscal exposure, and democratic governance by concentrating financial power in the executive branch.
Taxpayers: Liquidation proceeds from the Federal Reserve's assets would be transferred to the Treasury General Fund, potentially increasing federal revenue.
Federal employees (former Fed staff): Accrued compensation and benefits that vested before abolition must be paid, protecting earned retirement and pay obligations.
Congress and the public: The Secretary of the Treasury and OMB Director must report to Congress within 18 months on implementation and unresolved issues, creating a formal transparency mechanism for the wind-down.
All Americans (households, businesses, banks): Abolishing the Federal Reserve could disrupt monetary policy and financial stability, risking higher interest rates, higher inflation, and banking instability.
Financial institutions and depositors: Rapid liquidation of Fed assets and the end of central bank functions could impair liquidity provision, payment systems, and lender-of-last-resort support, increasing the risk of bank runs and payment disruptions.
Taxpayers: The Treasury would become liable for Federal Reserve obligations (including pension and benefit liabilities), potentially imposing large costs on the federal budget and taxpayers.
Based on analysis of 2 sections of legislative text.
Introduced March 5, 2025 by Thomas Massie · Last progress March 5, 2025
Abolishes the Board of Governors of the Federal Reserve System and all Federal Reserve banks one year after the law takes effect, requires a one-year wind-down overseen by the Board Chairman with Treasury approval, and directs OMB to liquidate Federal Reserve assets and transfer net proceeds to the General Fund. Outstanding liabilities and accrued employee benefits become obligations of the Secretary of the Treasury and are to be paid from liquidation proceeds; a joint implementation report to Congress is due 18 months after enactment.