Tuesday May 11, 2010 the US Senate voted unanimously (96-0; 4 not voting) on an amendment “To require the non-partisan Government Accountability Office to conduct an independent audit of the Board of Governors of the Federal Reserve System that does not interfere with monetary policy, to let the American people know the names of the recipients of over $2,000,000,000,000 in taxpayer assistance from the Federal Reserve System, and for other purposes.” There is slightly different wording between this amendment and the version passed by the House. The House and Senate bills will now go to the conference committee which will attempt to reconcile the differences between the two bills (and their amendments).
RonPaul.com posted the following:
Congressman Ron Paul (TX-14) today expressed disappointment that the Senate failed to pass an amendment offered by Senator Vitter (amending the Senate financial reform bill), which included the express language of Congressman Paul’s landmark “Audit the Fed” legislation. Paul’s legislation passed by a large margin in the House of Representatives last fall as part of the House financial reform bill, and Senator Vitter’s amendment would have paved the way for a full and ongoing audit of all of the Federal Reserve’s lending and monetary policy activity.
However, the Vitter amendment was supported by over 1/3 of the Senate, and the Sanders amendment (calling for disclosure of how approximately $2 trillion of Federal Reserve credit facilities were dispersed) passed unanimously today in the Senate. Therefore Paul remains hopeful that momentum is shifting and the days of Federal Reserve secrecy are coming to an end.
“The 37 votes our measure received in the Senate represent a strong step in our continuing work for full Federal Reserve transparency. In addition, the passage of the Sanders Amendment is a victory for taxpayers, who will finally know who received $2 trillion of their money,” stated Congressman Paul. “The Fed is no longer an untouchable monolith. It can no longer take for granted its absolute power to create and give away public money at will, with no true accountability. With strong support in the Senate, the House, and especially among the public, more victories for full transparency lie ahead.”
John Tate of the Campaign for Liberty attacked the Sanders Amendment and said he will continue to push Congress for an up or down vote on Ron Paul’s HR 1207.
Today, the U.S. Senate voted 62 to 37 against an amendment to allow greater transparency at the Federal Reserve.
This amendment was introduced to counter a weaker amendment that would have required only a one-time audit just of Fed emergency programs. The new amendment was similar to the original H.R. 1207 audit bill introduced by Congressman Ron Paul and added to the House financial reform package.
“The Sanders Amendment is no substitute for a complete and thorough audit of the Fed,” said John Tate, President of Campaign for Liberty. “With this vote, we now have a record of those who really want transparency and those who only pay lip-service to it while upholding the status quo.”
If the entire financial regulation bill makes it out of the Senate, it heads to the House, where House Financial Services Committee Chairman Barney Frank will choose which version to move forward on.
“The Dodd bill itself is just another bad piece of legislation, which will benefit no one except the Fed and its friends at big banks,” said Tate. “It institutionalizes bailouts for banks and subsidizes risky financial decisions.”
“Despite what happens with the financial regulation bill, we will continue pushing Congress for an up or down vote on H.R. 1207, which is the only full audit to allow true transparency in our financial system.”
DownsizeDC has given five possible outcomes to an audit of the Federal Reserve System:
Outcome #1: The audit is ignored.
The FED is a complex operation, and the audit will reflect that. There may be no soundbites that the media and the public can understand. The audit report may simply be ignored, and then forgotten.
Outcome #2: The FED gets a passing grade.
We can’t guarantee that the audit will tell us what we want, or that the auditors will even focus on the things we think are important. The audit will most likely be conducted by establishment insiders, not by people like us. The result could be the exact opposite of what we expect.
Outcome #3: The audit reports bad things, but nothing is done about it.
We think this is the most likely result. In the 1980s the Grace Commission found massive examples of government waste and fraud, but nothing was ever done about it. Instead, the problem just got worse. People may pay attention to the audit, just as they did the Grace Commission, but that doesn’t mean real change will happen.
Outcome #4: The auditors report big problems, and Congress decides to fix the FED.
This may sound like the result we want, but it could be the worst outcome. We want to end the FED, not have Congress micro-manage it.
Imagine what would happen if money creation was a partisan political power. Imagine the consequences if a single branch of government, Congress, could both spend money, and create it.
Have you ever watched a Financial Services Committee hearings on C-Span? It’s frightening. I hate the FED, but Lord, please, don’t let these people control our money supply!
Outcome #5: The auditors report horrifying things, and Congress decides to close the FED.
This is what we want and I see an audit as a stepping stone to a complete shut-down of the Federal Reserve.