The Sunset Clause That Never Was:
How the Fed Avoided Its Predecessors' Fate The most consequential institutional design difference between the Federal Reserve and its predecessors: the absence of a charter expiration date. This wasn't an oversight—it was a deliberate lesson learned from watching two previous central banks abolished when their 20-year charters came up for renewal. The question of whether the Fed could have survived renewal in 1933, at the nadir of its catastrophic Great Depression failure, reveals much about how institutional entrenchment works and why we keep recreating what we previously rejected. The Deliberate Design: Learning From Abolition When Congress debated the Federal Reserve Act in 1913, the fate of the First and Second Banks loomed large. Both had been competently managed at various points. Both had provided genuine economic benefits. Yet both were abolished when their charters expired—not because they failed operationally, but because Americans rejected concentrated financia...
