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House passes Ron Paul’s ‘audit the Fed’ bill
In a move that serves as a capstone to Rep. Ron Paul’s colorful career, the House on Wednesday approved a bill that would let Congress’s chief investigators conduct a full audit of the Federal Reserve’s shrouded decision-making process.
The overwhelming 327-98 vote sends the bill to the Senate where Majority Leader Harry Reid, Nevada Democrat, has previously expressed support for an audit — though it’s unclear he’ll carve out time for the legislation this year.
But House passage already marks a high-water mark for those who for years have been pushing for an audit, led by Mr. Paul. The Texas Republican rode the issue to prominence in two different presidential campaigns, and said the bill is a chance for Congress to begin to reclaim the money and banking powers it is given in the Constitution, but had delegated to the Fed.
“It is up to us to reassert ourselves,” Mr. Paul said during floor debate Tuesday.
Fed Chairman Ben Bernanke doesn’t like the prospect of such a broad audit, calling it a “nightmare scenario” last week and saying it will lead to politicians second-guessing his decisions.
Opposition in Congress came chiefly from Democrats who said they doubt the bill ever becomes law — but worried about sending a signal to financial markets that lawmakers want to intervene in financial affairs.
“It seems to me what we’re talking about is taking some fake punches at the Federal Reserve but not doing anything serious,” said Rep. Barney Frank, the ranking Democrat on the House Financial Services Committee.
The bill would grant the Government Accountability Office, which is Congress’s chief investigative arm, the power to retroactively review the Fed’s decision-making — particularly on monetary policy.
Congress established the Federal Reserve nearly a century ago. The system, which consists of a board of governors and 12 regional banks, act as lenders of last resort to the country’s banking system, and it is charged both with fighting inflation and with promoting economic growth and employment.
The interest rates it sets have a direct impact on the rates charged by banks to consumers, but Congress shielded the board’s decision-making from view in order to give it independence.
After the recent financial collapse, many lawmakers have begun to question the Fed’s decisions and want a closer look at what it’s been doing.
Mr. Frank, though, said giving GAO powers to look at monetary policy is a precursor to Republicans trying to change the Fed’s mission overall to focus solely on monetary policy, not employment.
Congress has okayed more limited audits of the Fed in recent years, and following through on that a GAO report last year found the Fed repeatedly invoked emergency authority to expand its lending during the Wall Street crisis in 2008 and 2009, including major loans to prop up the housing market.
The audit also found the Federal Reserve Bank of New York, which had a major role in the lending, did not have sufficient controls to prevent conflicts of interest for its employees.
-------------------- It isn't so much that liberals are ignorant. It's just that they know so many things that aren't so. Posts: 6949 | Registered: Apr 2004
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did not have sufficient controls to prevent conflicts of interest for its employees.
i think i'm going to puke. this is like the understatement of the millenium....
the key to the Universe is in these guys hands and you think they are going to allow it to be taken away?
this is why we need to put the pitchfork and torch factories on double shift....
this isn't about partisanship. the senate is set up to be able to avoid the issue on purpose, the filibuster rule makes partisanship APPEAR to be working when the reality of the situation is that the Senate IS the Money Hole. The poorest senators are well above the 1% mark. They blame partisanship on TV but in the back rooms? they are the ones divvying up the loot and distributing it.
get rid of the filibuster vote (cloture) and make them do real filibusters with a catheter strapped to their legs and drug testing.. then you'll get some real change. until then this is all a FARCE made for TV... like the Benny Hill show
-------------------- Don't envy the happiness of those who live in a fool's paradise. Posts: 36378 | From: USA | Registered: Sep 2003
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I don't mind the audit, but lets do that once we have a little firmer footing. Hindsight is 20/20 but it doesn't help unless you are ahead of what you are trying to look back on. We aren't yet.
After all, no one in either house is going to want to take on anything significant until after the votes are tallied in November.
I agree with getting rid of the filibuster vote also. Make a filibuster hurt and there will be more reason to find compromise.
-------------------- No longer eligible for government service due to lack of tax issues. Posts: 5178 | From: Up North | Registered: Dec 2005
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how to "make" these gys do anything? Kerry Mccain Hillary Clinton Obama? all senators....
thnk about it, who is really running this country? 40 senators are...
the senate needs to be replaced somehow, and that statement alone prolly just got me a courtesy black helicopter flyby...
it's what really is. the president cannot do adamn hting without those 40 senators, ever.
as to "firmer footing" sorry Big, but there's no firmer footing int heforeseeable futre. i thnk we all need to recognise just how bad things got, and the fact is they got this bad by ignoring the real problems...
the biggest problem is jobs and there is only ONE single way to turn that around but there is too much profit in hiring poor people in china to make our toys for us.
-------------------- Don't envy the happiness of those who live in a fool's paradise. Posts: 36378 | From: USA | Registered: Sep 2003
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I to a small degree disagree with your future forecast. Yes, things got real bad. Yes, things are bad. Yes, we are not going to be in easy economic times for a least another decade (probably more like two).
However, corporate profits and cash accounts are at all time highs. Eventually those are going to unlock and I think that starts a little bit after the election whichever candidate wins, whichever party controls house and senate.
There are still bombs unexploded, student debt, china slowdown, bank clusters, hidden and/or fraudulent assets, perhaps a failure in Europe, and I wouldn't be surprised at all to see round two of CDS from those who just don't learn.
Eyes are open though. There is no more blissful ignorance left. Bubbles form when everyone colludes in a self deception and right now the only thing that everyone is agreeing on is that US treasuries are the only safe bet. (Which I find ironic personally but whatever.)
There are shockwaves in the near future but they will not totally freeze the capital markets and drop all asset classes as happened three years ago.
I say let the country run for another 5 years and then do an in depth review of everything related to fiscal policy from 1990 to 2015.
-------------------- No longer eligible for government service due to lack of tax issues. Posts: 5178 | From: Up North | Registered: Dec 2005
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wo Big, you just made it sound worse than i thought it is...
seriously, i think you have a good grasp of what is going on too..
i get your point about trying to make some space so the Fed can make things look better whent hey do fianlly get audited.
how about his.
we begin auditing them historically since the beginning right now. let it all out and see how bad it has been, by the time we get to 1990< it will be more than five years down the road and maybe the lessons learned by that time will give everyone better insight into why they do what they do... and maybe they will be able to become more "accountable" by then...
lets face it, lack of accountability is never good no matter what the program...
i am not one of those peopel who think the Fed is any more evil than anything else, i do beleive that they should be held accountable, but then i beleive in more accountabiltiy for EVERYONE cuz i see lack of accountabiltiy at all levels of society, not just the poor as the "right" wants to say, and not just the rich as the "left " wants to say...
-------------------- Don't envy the happiness of those who live in a fool's paradise. Posts: 36378 | From: USA | Registered: Sep 2003
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-------------------- No longer eligible for government service due to lack of tax issues. Posts: 5178 | From: Up North | Registered: Dec 2005
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quote:Originally posted by glassman: how to "make" these gys do anything? Kerry Mccain Hillary Clinton Obama? all senators....
thnk about it, who is really running this country? 40 senators are...
the senate needs to be replaced somehow, and that statement alone prolly just got me a courtesy black helicopter flyby...
it's what really is. the president cannot do adamn hting without those 40 senators, ever.
as to "firmer footing" sorry Big, but there's no firmer footing int heforeseeable futre. i thnk we all need to recognise just how bad things got, and the fact is they got this bad by ignoring the real problems...
the biggest problem is jobs and there is only ONE single way to turn that around but there is too much profit in hiring poor people in china to make our toys for us.
Senators? What about governors. Clinton, Carter, Bush, Reagan.
-------------------- It isn't so much that liberals are ignorant. It's just that they know so many things that aren't so. Posts: 6949 | Registered: Apr 2004
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