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Audit the Fed

April 21, 2009 - by Donny Shaw

Year after year in Congress, Rep. Ron Paul [R, TX-14] has introduced a bill to abolish the Fed (H.R. 833). Though the bill has a dedicated network of citizen supporters – see the End the Fed network – it has never made any legislative progress or gained a single co-sponsor.

This year, however, Paul has introduced a toned-down version, along with the original, that is gaining co-sponsors quickly and could actually get a vote this session — the Federal Reserve Transparency Act of 2009. The co-sponsor list, currently at 58, is strongly bipartisan. It includes progressive Democrats like Rep. Alan Grayson [D, FL-8] and Rep. Henry Waxman [D, CA-30], Blue Dogs like Rep. Gene Taylor [D, MS-4] and Rep. Collin Peterson [D, MN-7], and conservatives like Rep. Michele Bachmann [R, MN-6] and Rep. Scott Garrett [R, NJ-5].

Far from ending the Fed, the bill calls for a full Government Accountability Office (GAO) audit of the central bank to be completed before the end of 2010 and submitted to Congress for review.

Current U.S. Code protects the Fed’s secrecy in several important areas (31 USC 714 – Sec. 714):

Audits of the Federal Reserve Board and Federal reserve banks may not include – (1) transactions for or with a foreign central bank, government of a foreign country, or nonprivate international financing organization; (2) deliberations, decisions, or actions on monetary policy matters, including discount window operations, reserves of member banks, securities credit, interest on deposits, and open market operations; (3) transactions made under the direction of the Federal Open Market Committee; or (4) a part of a discussion or communication among or between members of the Board of Governors and officers and employees of the Federal Reserve System related to clauses (1)-(3) of this subsection.

All of these barriers to access would be eliminated by Rep. Paul’s bill.

In the past year or so, the Federal Reserve has given banks more than $2 trillion in loan guarantees in an attempt to forestall the economic crisis. But information on where all this money has gone and what kind of securities the Fed has accepted in exchange is unavailable. Since the Fed is a quasi-public institution, they aren’t obliged to tell us, even though they are pushing around public money. “The contrast is pretty clear,” says Sen. Bernard Sanders [I, VT], who is sponsoring the Senate version (S.604), “if you want to know who received the money under TARP, go to the website, it’s there. If you want to know who received the money from the Fed, it ain’t there.”

In the Politico, Ron Paul writes, “if this audit reveals what I suspect and Congress has finally had enough, it can also pass my legislation to abolish the Federal Reserve.” Whether you support ending the Fed, like Ron Paul, or fixing the Fed in order to restore the health of our financial system, finding out what the Fed is up to – and where they have been failing – is essential to moving forward. It may sound trite, but transparency is crucial for solving our economic crisis.

One more thing: OpenCongress user emarble left a comment on the bill text suggesting a simple improvement:

In addition to increased congressional oversight, it would be nice if this provision included “all citizens who request it.” I propose the report on the audit be made available to the general public in electronic form, thereby making the Federal Reserve completely transparent.

UPDATE: via Campaign for Liberty, with Congress back from break the bill is now up to 71 co-sponsors.

(pictured above is Federal Reserve Board Chairman Ben Bernanke, center, surrounded by Fed board members.)

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Comments

  • Anonymous 04/21/2009 1:23pm
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    Strange. I thought I might find something about bills on this subject sponsored by our President. Imagine this when I clicked on his page: Number of sponsored bills:
    71 (Ranks 21 of 440)
    Number of co-sponsored bills 433 (Ranks 12 of 440)
    Number of sponsored bills passed: 1 (Ranks 29 of 440)
    Number of co-sponsored bills passed: 17 (Ranks 14 of 440)
    Oh, boy, I said to me, now let’s see. Oh, crap, I said to me when I clicked on the numbers. They denied any knowledge of him doing anything. Please note I am avoiding making snide comments about someone in my own political party.

  • DSciphire 04/21/2009 2:30pm
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    Test.

  • DSciphire 04/21/2009 2:33pm

    It is about time we had some real transparency in government when it comes to obvious abuses of the citizens tax dollars. Supporting Ron Paul’s bill, HR 1207, may be the most important piece of legislation our generation will see. It is standard practice for every individual and business to be subject to an audit by the IRS – our hard earned money – but we can’t even begin to ask questions about how the Fed spends our hard earned money. Absolutely atrocious!

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    etls1 04/23/2009 2:35pm

    Without the Fed, there would be no need for the IRS. You are right, this is a very important bill. It is a good starting point in getting these arrogant financiers under control.

  • DSciphire 04/21/2009 2:33pm

    Let’s get this bill passed folks. Support HR 1207 in any way you can! Here are a few places to begin.

    Upcoming Audit The Fed Rally’s in front of every Fed building nationwide (40 cities) on April 25th, 2009.
    Find your local groups @:
    http://www.EndTheFed.us

  • DSciphire 04/21/2009 2:34pm

    Also, to follow the rallies, participate in “Melt the Switchboard Day”. Another nationwide event where you simply call the congressional switchboard in order to attain the contact information for your Rep. to make your voice heard about this crucial bill, HR 1207.
    Full Details Here:
    http://endthefedusa.ning.com/events/audit-the-fed-melt-the

    You can find me in any local NYC group. Let me know your thoughts.

    Anthony Lombard

  • Anonymous 04/22/2009 7:27am

    “The very word “secrecy” is repugnant in a free and open society; and we are as a people inherently and historically opposed to secret societies, to secret oaths and to secret proceedings. We decided long ago that the dangers of excessive and unwarranted concealment of pertinent facts far outweighed the dangers which are cited to justify it. Even today, there is little value in opposing the threat of a closed society by imitating its arbitrary restrictions. Even today, there is little value in insuring the survival of our nation if our traditions do not survive with it. And there is very grave danger that an announced need for increased security will be seized upon by those anxious to expand its meaning to the very limits of official censorship and concealment."

    — President John F. Kennedy
    The President And The Press: Address Before The American Newspaper Publishers Association, April 27, 1961
    Waldorf-Astoria Hotel

  • Anonymous 04/22/2009 10:37pm

    Here’s a YouTube video of Ron Paul updating the bill status:

    http://www.youtube.com/watch?v=bW4YZ6R53yA

  • Anonymous 04/22/2009 10:38pm

    Here’s a YouTube video of Ron Paul updating the bill status:

    http://www.youtube.com/watch?v=bW4YZ6R53yA

  • Anonymous 04/23/2009 10:47am
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    Test

  • Anonymous 04/23/2009 10:49am

    What about all the money e wrote off in foreign loans? How much? Who? Why is Joe VP? Is this Delewre banking? Why aren’t Delaware banks at the meeting with Obama? Are they waived like the foreign aid loans written off by Congress at Treasury? Will they not tell us how much and who?

  • Mrs_B 04/26/2009 7:22am

    Send this link to everyone you know! It’s a petition to your Congresspeople to support this bill!

    http://www.campaignforliberty.com/campaigns/auditthefed.php

  • DSciphire 04/30/2009 4:03am

    DownsizeDC.org has added an “Audit The Fed” Campaign. Email your congressperson directly throught their site.

    http://www.downsizedc.org/etp/campaigns/112

  • Anonymous 07/07/2009 8:41pm

    HR 1207 now has 245 co-sponsors: http://thomas.loc.gov/cgi-bin/bdquery/z?d111:HR01207:@@@P

  • Anonymous 07/31/2009 10:45pm

    Every society is judged by how it treats it’s least fortunate amongst them. Our so called leader’s that are awear of the FED. RESV. and don’t speak out to inform the public are not AMERICAN and there selling out this country. That goes for those who are in the meda and fear that they will get the same thing that J.F.k got. Ron paul has’t forgot GOD COUNTRY and J.F.K AUDIT the FED. RESV.
    FEAR GOD NOT MAN.

  • Spam Comment

  • Anonymous 10/21/2009 1:33am

    “Since the Fed is a quasi-public institution, they aren’t obliged to tell us, even though they are pushing around public money” true the feds are a part private part public institution, but what makes them private is the fact that they receive no public tax dollars from the government. their funds come for the profit made by selling securities and bonds. this look like a power grab by the government which they justify because we the people are anxious about the federal reserve. the feds are banker and businessmen who act with their own interests in mind. enough said

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