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Senate to Vote on Auditing the Fed Today

May 6, 2010 - by Donny Shaw

With most of the non-controversial financial reform amendments out of the way, the Senate today is moving on to one that will divide both parties and is strongly opposed by the White House. The amendment, from Sen. Bernard Sanders [I, VT], would open up the Federal Reserve’s monetary policy decisions to a full Government Accountability Office audit for the first time ever.

The Obama Administration and other opponents of the amendment worry that bringing new transparency to the Federal Reserve would threaten its independence and politicize its monetary policy. The White House has been fighting this hard. In fact, in their own words, they will “fight to stop it at all costs,” and that may include vetoing the full bill if it is adopted. Obviously, vetoing a popular regulatory reform bill over a popular transparency provision would be a disaster, so the White House is lobbying the Senate to vote “no.”If the Senate were to adopt the amendment, it would be nearly impossible to take out in the House-Senate conference committee since the House included a Fed audit provision in their financial reform bill.

According to Huffington Post, it looks like their lobbying is working and senators who supported the amendment just weeks ago are now waffling:

HuffPost Hill canvassed senators to gauge support for it today, and found extremely few willing to commit, with most undecided, saying they still had to review the language. That includes senators who have supported a Fed audit in the past, including Harry Reid, Richard Burr, Mary Landrieu, Patty Murray, Amy Klobuchar, Claire McCaskill, Orrin Hatch, Saxby Chambliss and John Cornyn. “So far, I’m on the amendment, but I have some qualms about it. I’ll have to study it,” said Hatch.

And now The Hill is reporting today that Sanders is now worried that he doesn’t have enough votes to pass the amendment if it is filibustered. Breaking a filibuster requires 60 votes.

The vote is expected around noon. We’ll be watching and reporting back. Stay tuned.

UPDATE: Huffington Post reports on a strategy to draw votes away from the Sanders amendment:

The likely tactic to oppose it will be the introduction of an alternative, much weaker amendment, that will give cover to those who want to vote against the Fed, but so far no such amendment has appeared.

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