Among powerful governmental institutions, the Federal Reserve is surely in the first rank. It is in the first rank because of the policy responsibilities it is assigned – determining monetary aspects of macroeconomic policy and regulating financial institutions. The Federal Reserve is important, and it is increasingly controversial. In the past two decades, there have been repeated new departures in monetary policy in response to economic crises. According to critics, policy has been conducted unsteadily. The Federal Reserve has been accused of destabilizing the economy. It has been criticized for seeming to say one thing and then doing another.

Nevertheless, political scientists have rarely studied the Federal Reserve systematically, and economists have often had to undertake their own bootstrap political analyses of the institution. Perhaps political scientists have been misled because, despite the fact that the Federal Reserve's responsibilities are politically sensitive ones, it is supposedly independent of political influences. Plainly, the Federal Reserve is a key political institution. It defines, sets, and implements public policy in a central arena. It is engaged in conflict that is increasingly overt. Its actions have important consequences for other institutions that political scientists have studied extensively.

This work provides an introductory survey of some political aspects of the Federal Reserve System, particularly the System's relationships with other political actors. There is much work to be done in this area.